Experiences with Kickstarter?

[Vidar]

I signed up for two Kickstarter projects back in the day just for support and curiosity. Neither has delivered to this day.

One is seemingly still working hard at it and spending the money towards the intended purpose. I’d rather have a delayed proper product than a lousy delivered one on time so that is fine by me. It would have been better with more realistic delivery times in the first place, but unknowns and the future are notoriously hard to predict. Fair enough; if I wanted a sure thing at a given time I would just have bought something in the shop instead. 

The other one seems to have underfinanced and overpromised and nobody seem to be working on the project either. That I do have an issue with – if you take my money at least do what you can. I believe it was started with honest enough intentions but that still leaves everyone who supported and had faith out in the cold.

If one disregards the scammers who underfinance and overpromise on purpose it seems to me most of the projects involving hardware struggles crossing from say a single prototype to actual production.

What are others experiences with Kickstarter and the likes?

[El Rago]

one thing I learned was that KS is not a store. you are an investor on a potential product. that product might or might not be realized.

that said I backed one project (toolcard) and it got funded an delivered on the promises made. communications where prompt, KS'er had some other projects succesfully funded and when I joined, the project was already funded.

the most important thing you have to keep in mind is, that if it sounds too good to be true, it probably is.

[Steinar]

Let's see... I have supported four projects I remember right now, two delivered pretty straightforward, one did not get sufficient funding, and one is ridiculously delayed, but claims to be working on the project. 

I think quite a few sincere Kickstarter projects are run by people with little experience in managing projects, and then deadlines and the ability to deliver at all will suffer if the product has any real complexity.

[ironraven]

quite a few sincere Kickstarter projects are run by people with little experience in managing projects,

This.

And I hate to be that guy, but that is why as tempted as I often am, of the things I've been tempted by only one has made it to market. I'm glad I didn't invest in any of them.

[Vidar]

[And I hate to be that guy, but that is why as tempted as I often am, of the things I've been tempted by only one has made it to market. I'm glad I didn't invest in any of them.

I find myself being that guy too sometimes. But sometimes I also regret not going for it later. Which leaves me in this weird spot of whether it is worst to regret what is done or regret what was not done? I think the latter is actually more annoying as long as the money is relatively small anyway.

Besides I like seeing new stuff happen, and me doing a little part is ok. I just want to sign up for an honest best try at least.

[thatotherguy]

There are several things I was tempted to back along the way, and to be honest I'm glad in retrospect that I didn't. Those things that made it, I can buy later when I have some more confidence in actually getting product in hand. Those that didn't, I wasn't going to end up receiving regardless of how much I liked it or how good of an idea it was.

I'll gladly pay a bit of a premium over Kickstarter rewards deals to be confident that I will actually receive the item I spend my hard earned money on.

[Vidar]

Those things that made it, I can buy later when I have some more confidence in actually getting product in hand.

Of course if no one signs up it might never get to the shops in the first place.. Actually I believe very few of even the succesful projects ever make it into normal retail. From that perspective if there is something one really wants one might have to risk it?

To me personally though Kickstarter is not only about he reward but also about helping projects or people I like to proceed and hopefully succeed. I readily accept the risk that things might go bump in the night.

What I have a problem with are projects that seemingly just runs off with the money without even trying to fulfill their promises. Kickstarter really needs to come up with a way to stop those as they seriously undermine Kickstarters basic premise for existing.

I'll gladly pay a bit of a premium over Kickstarter rewards deals to be confident that I will actually receive the item I spend my hard earned money on.

Personally I think this is very many Kickstarter projects head straight for problems with underfinancing: Most manufacture is most expensive by far at the very beginning and at low volume, and gets less expensive with mass manufacture and scale of economics.

Yet many projects offer rewards given at the very beginning for less than their own anticipated price when they do higher volumes. It seems to often end up with projects having promised rewards for less than their own cost.

[Kev D]

I invested once in something calley znaps. A year after they were supposed to deliver I got an email asking me to confirm my postal address as they had lost it. I did this on 5 separate occasions.  Then they sent another saying there's a mess up with delivery and would just refund me, which I never got. I chased them multiple times and eventually gave up when I found a forum dedicated just to znaps ripping thousands of people off totalling millions of dollars. There's also a website dedicated to all the scams called kickscammed.com

I'll never back anything again.

[Vidar]

I invested once in something calley znaps. A year after they were supposed to deliver I got an email asking me to confirm my postal address as they had lost it. I did this on 5 separate occasions.  Then they sent another saying there's a mess up with delivery and would just refund me, which I never got. I chased them multiple times and eventually gave up when I found a forum dedicated just to znaps ripping thousands of people off totalling millions of dollars. There's also a website dedicated to all the scams called kickscammed.com

I'll never back anything again.

That is what I don't get. Kickstarter have been operating for years and should have come up with ways to prevent these kinds of things. As it is I think many think like you and decide to just bail out of the entire concept. Which is totally understandable, yet also sad as there clearly is a need for such platforms for the honest projects.

Any of the other ones better in this respect? Indiegogo? Others? (I've only tried Kickstarter).

[Kev D]

After my experience with kickstarter I haven't bothered checking any others.

[Smashie]

After my experience with kickstarter I haven't bothered checking any others.

I'm with Kev on this, got burned 3 times, not for any significant amount of money but it left a foul taste in my mouth

[Vidar]

I'm with Kev on this, got burned 3 times, not for any significant amount of money but it left a foul taste in my mouth

I guess Kickstarter with its commision payments doesn't really have a short-term incentive to properly prequalify or filter the projects they let in. Long term though it seems like sawing off the branch they sit on. Not too many positive feedbacks here at least. Hopefully there are someone somewhere who had better luck.

I still like searching for new stuff once in a while, and I do hope to find some interesting and deserving projects in the future too, but I will surely pay more attention and be more critical while evaluating the projects actual chances of fulfilling.

[Kev D]

They don't seem to have any protection what so ever for people backing any projects. The one I got burned with, for £129 total  , has all sorts of reports of them sending out empty envelopes and claiming the contents must have got lost in transit, but the weight on the post mark gives away their scam.

I've seen quite a few other projects on kickstarter I would buy when they are fully released and on sale from a reputable retailer, but I won't back them while they on there.

[Vidar]

They don't seem to have any protection what so ever for people backing any projects.

If there is any it certainly isn't very effective.

That is why I thought some of the alternatives/ competitors might be better at that. It should be a competitive advantage to secure both sides of the deals they are effectively the broker of. One would think that the serious project owners would prefer to be on a site known for good projects that delivers. I guess pure traffic beats that logic (for while at least).

[Smashie]

Right I'm going to have eat humble pie as I've just backed a product, different being that I trust the guy who started it

https://www.kickstarter.com/projects/eevblog/eevblog-121gw-multimeter?ref=home_popular

[Don Pablo]

5 AU$ I presume? 

[Don Pablo]

On a serious note, that is a wicked looking multimeter! 

[Blackbeard]

all I know is mountain dew kickstart makes me bounce off the walls  , its awesome

[pomsbz]

Kickstarter is a platform for people who can't persuade banks that they have a good business plan. Often because they don't begin to have a business plan. That is if it's not a straight scam in the first place.

[Vidar]

Kickstarter is a platform for people who can't persuade banks that they have a good business plan. Often because they don't begin to have a business plan. That is if it's not a straight scam in the first place.

I think that is a quite unfair statement. Banks are very risk averse, and a equally flat statement is they wont lend you money unless you don't need it.

There is a reason there are opportunities and need for angel investors, venture funds and the classic tripple F (friends, fools and familty) to get new projects going. Crowdfunding is really a valuable supplement to those if done right, and especially in the very early stages of a project. Which of course is also were the risk is highest for a plethora of reasons. Professional investors in early stage projects typically expect that just 10-20% of projects to do well. And yes many crowdfunding projects are indeed not even at such an early stage.

For entrepreneurs that succeed (and they all think they will) bank money would have been very inexpensive compared to taking money from investors. But given the typical format of bank loans, and their necessarily risk averse nature, bank financing is not a good fit for innovative projects.

What crowdfunding does offer is indeed kickstarting a project at an early phase.And being early phase the risk is typically high. I'm fine with that - I actually find some value in contributing to new things. If I get a cool thing later even better. What I have a hard time with are projects that in some variant just takes the money and don't try to deliver. Or of course outright scams. I wish Kickstarter would do a better job to keep these away as they undermine the entire concept - and the basic concept is good.

[Steinar]

Some projects I can support simply because I want something to exist or happen (and thus I don't care about rewards), other times I want my stuff.

Also, new businesses are funded with VC capital, banks are "never" involved. (Disclaimer: The tech sector is the one I know something about, on the other hand, tech is a huge segment on Kickstarter.)

Basically, I agree with Vidar on this one.

[Vidar]

It should also be mentioned that many crowdfunded projects are just about a single project as such, and have no intention or ambition of being a commercial project - far less starting a business.

[ironraven]

They don't seem to have any protection what so ever for people backing any projects.

And they are honest about that- it isn't a store. Its an investment opportunity. Investments sometimes flop.

[pomsbz]

Kickstarter is a platform for people who can't persuade banks that they have a good business plan. Often because they don't begin to have a business plan. That is if it's not a straight scam in the first place.

I think that is a quite unfair statement. Banks are very risk averse, and a equally flat statement is they wont lend you money unless you don't need it.

There is a reason there are opportunities and need for angel investors, venture funds and the classic tripple F (friends, fools and familty) to get new projects going. Crowdfunding is really a valuable supplement to those if done right, and especially in the very early stages of a project. Which of course is also were the risk is highest for a plethora of reasons. Professional investors in early stage projects typically expect that just 10-20% of projects to do well. And yes many crowdfunding projects are indeed not even at such an early stage.

For entrepreneurs that succeed (and they all think they will) bank money would have been very inexpensive compared to taking money from investors. But given the typical format of bank loans, and their necessarily risk averse nature, bank financing is not a good fit for innovative projects.

What crowdfunding does offer is indeed kickstarting a project at an early phase.And being early phase the risk is typically high. I'm fine with that - I actually find some value in contributing to new things. If I get a cool thing later even better. What I have a hard time with are projects that in some variant just takes the money and don't try to deliver. Or of course outright scams. I wish Kickstarter would do a better job to keep these away as they undermine the entire concept - and the basic concept is good.

I'd been burned by 50% of the projects I backed over three years which never occurred (the 'successful' ones were woefully under planned for market) before I came to that conclusion. I stand by my statement. If a bank won't lend you the capital, neither will I. They probably had a good reason to be wary. The simplest of which is a requirement for security and the need for a proper and realistic business plan.

[Vidar]

I'd been burned by 50% of the projects I backed over three years which never occurred (the 'successful' ones were woefully under planned for market) before I came to that conclusion. I stand by my statement. If a bank won't lend you the capital, neither will I. They probably had a good reason to be wary. The simplest of which is a requirement for security and the need for a proper and realistic business plan.

What level of risk vs possible reward you are comfortable taking is of course entirely up to you. If that level happens to coincide with typical bank risk levels then Kickstarter likely hasn't got many projects for you, so fair enough.

Even if a bank is on board startups might still opt for Kickstarter though. Banks don't finance 100% anyway, and crowdfunding is also a way for companies to get early traction and feedback from the market.

That said there are lots of projects that are good despite getting turned down by banks. In fact that likely goes for the majority of innovative businesses. Of course banks are no oracles either - lots of companies financed by banks still go belly up. 

A few examples of the very long list of companies that needed investor capital to get going include Leatherman, Google, Skype, Cisco, Uber, Apple, Airbnb, Intel... (Most were also turned down many times before finally finding financing to get going).

Of course for each of these extreme examples are many that failed amazingly and lost all the investors money. It does show though that banks do turn down good projects too  - many of which has indeed got good business plans. Just not a plan at the risk level banks take.

They don't seem to have any protection what so ever for people backing any projects.

And they are honest about that- it isn't a store. Its an investment opportunity. Investments sometimes flop.

That is fair enough - things doesn't always work out as planned.

What you do sign up for though, and contribute to finance, is a certain described project. The money is paid with the clear understanding that the money will go towards trying to realize said project and further that the team does their part as described.

This does not always happen. Some just take the money and basically say "smurf you" to the backers - and Kickstarter doesn't seem to offer any protection against this. Such a protection would seem like a very reasonable wish?

[Etherealicer]

Kickstarter is a platform for people who can't persuade banks that they have a good business plan. Often because they don't begin to have a business plan. That is if it's not a straight scam in the first place.

I think that is a quite unfair statement. Banks are very risk averse, and a equally flat statement is they wont lend you money unless you don't need it.

There is a reason there are opportunities and need for angel investors, venture funds and the classic tripple F (friends, fools and familty) to get new projects going. Crowdfunding is really a valuable supplement to those if done right, and especially in the very early stages of a project. Which of course is also were the risk is highest for a plethora of reasons. Professional investors in early stage projects typically expect that just 10-20% of projects to do well. And yes many crowdfunding projects are indeed not even at such an early stage.

For entrepreneurs that succeed (and they all think they will) bank money would have been very inexpensive compared to taking money from investors. But given the typical format of bank loans, and their necessarily risk averse nature, bank financing is not a good fit for innovative projects.

What crowdfunding does offer is indeed kickstarting a project at an early phase.And being early phase the risk is typically high. I'm fine with that - I actually find some value in contributing to new things. If I get a cool thing later even better. What I have a hard time with are projects that in some variant just takes the money and don't try to deliver. Or of course outright scams. I wish Kickstarter would do a better job to keep these away as they undermine the entire concept - and the basic concept is good.

I'd been burned by 50% of the projects I backed over three years which never occurred (the 'successful' ones were woefully under planned for market) before I came to that conclusion. I stand by my statement. If a bank won't lend you the capital, neither will I. They probably had a good reason to be wary. The simplest of which is a requirement for security and the need for a proper and realistic business plan.

Banks usually also don't give out small credits, or do so with high interest rate. Banks also do not include PR. Having your project on Kickstarter is a great start to draw attention (although it is not nearly as effective anymore as it used to be in the beginning).

Personally, I find kickstarter great, and would probably fund more projects if I could do so using PayPal (alt least last I checked that was not an option).
Personally, I don't back projects that have a goal beyond 5k. I think that is where the bank should come in. I mean I recently saw an addition to your bike carrier, but they needed 35k Euros for funding. To me, that is simply unrealistic.
Finally, when I support a project, I see this as a donation, like when I give money to the local circus. I do so, because I like what they are doing and wish for them to follow those dreams.

[pomsbz]

Of course banks are no oracles either - lots of companies financed by banks still go belly up. 

I'm confused about this argument. Because projects and ideas which have passed rigorous investigation by banks sometimes fail therefore it makes sense to gamble on projects which have not even passed said investigations?

[Vidar]

Of course banks are no oracles either - lots of companies financed by banks still go belly up. 

I'm confused about this argument. Because projects and ideas which have passed rigorous investigation by banks sometimes fail therefore it makes sense to gamble on projects which have not even passed said investigations?

I'm just saying that there are no guarantees.

Whether a project is good or not doesn't just depend on the risk involved, but also the possible reward if success and if that potential reward is worth the risk. Banks are low risk only though, so good high risk projects are cut off by default.

And many projects on Kickstarter isn't really about starting a business at all - for those bank financing and business plans are all kind of irrelevant.

[Smashie]

I've invested in business in the past and there are no guarantees (including my own), KS are very up front about that.

They wont accept PP for a very simple reason, delayed, people get money back, doesn't happen, money back, cold feet, money back. I'm pretty sure they have the send money to a friend option for that very reason, no comebacks on PP and they waive the fee because of it.