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Lockitron: How a Startup Overcame Kickstarter's Rejection

Not taking no for an answer is a business hallmark. Just ask Apigy.

The Silicon Valley startup recently relaunched Lockitron, a combination door lock device and smartphone app that transforms your cell phone into a digital house key.

But Lockitron's evolution—with more than $1.5 million in presales in 2012—illustrates how social media and crowdfunding are transforming the entrepreneurial landscape.

Lockitron was actually rejected in September by Kickstarter—an online funding platform that connects small businesses with potential backers.

The Kickstarter rejection "almost broke our hearts. We had to quickly move forward with a similar plan," said Paul Gerhardt, co-founder of Lockitron. “We wanted to create a product that would change the world,” he said.

Rejected by Kickstarter

Kickstarter said Lockitron was a home-improvement product and not a creative project as mandated by Kickstarter's submission guidelines, Gerhardt said.

Since its launch in 2009, Kickstarter's popularity has grown, and the platform doesn't accept all projects for promotion. Last month, the company published a blog post that stressed, "Kickstarter isn't a store." Kickstarter also launched new guidelines including one that requires project creators outline "risks and challenges."

The post came amid some criticism of product-based Kickstarter projects. Entrepreneurs have received millions through the site to develop products—then only to miss shipping goals and leave backers upset. Smartphone watchmaker Pebble, for example, has faced scrutiny about shipments after receiving millions in funding, INC. reported.

Build your own Kickstarter

But the Kickstarter rejection didn't stop Lockitron founders Gerhardt and Cameron Robertson, both 25. Within days, their team created their own website, a homespun version of Kickstarter if you will. Using Lockitron's new site, customers can preorder the second version of Lockitron for $149, and leave credit card numbers that are stored by a third party, tech giant Amazon . An Amazon spokesman was verifying Lockitron's use of Amazon at press time.

Once the online payment infrastructure was created, Lockitron founders converged on Twitter and Facebook to generate product buzz. At $149 a pop, more than 10,000 customers, backers if you will, have placed preorders, according to Lockitron.

Without Kickstarter's built-in online community, Lockitron had to create their own viral buzz through social media. Preorder customers—convinced by the product's uniqueness and cool factor—became startup cheerleaders.

Lockitron includes a device that's added on top of a deadbolt. An accompanying smartphone app allows users to lock and unlock doors, and share access with family and friends. You receive an automated update, when someone such as a child opens the door with a phone or key.

"We let people tweet their order numbers, and it took off from there,” Gerhardt said.

Lockitron's second product is scheduled to ship in March 2013, and the company said it will charge customers credit cards at that time.

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