I think the move from product simulations/renderings to solely being able to show what the product can do now is a great change. I've been critical about some of the usages of Kickstarter in the past, but this addresses a big part of my concerns.
I do hope that it doesn't keep products that are in a rough state from being able to be successful, though if somethings really that complex that you need to raise a lot of money to have a marketable prototype, let alone bring it to market, I don't think Kickstarter donations are the way to fund it.
What a measured, interesting, and social response.
As programmers, we often try and fix things with code, but it's cool to see Kickstarter improve their product by thinking about what questions the creators should be asking. I also agree that hardware makers do themselves and other a disservice by showing space age renderings of their products.
It isn't just revenues: having people who think they are buying things (or probably worse: think they are selling things) but aren't really (as there are risks and this is all just contributing money to possible futures) has legal and accounting (eg. sales tax) ramifications that kickstarter was not previously, not seemed to have any signs of in the future, addressing.
I agree. I think a good compromise would be to ensure that anything that was a simulation or rendering was very obviously labeled as such, so that there would be absolutely no doubt in the viewer's mind.
The problems is skilled designers are starting to pull off big time scams fooling people for hundreds of thousands of dollars. People see realistic renderings of a hoverboard or whatever and they immediately open their wallets without realizing that their is very little chance that they will be able to pull it off. If people see a skateboard with some glued-on fans they will be much more skeptical.
I asked this a while back and the answer was pretty much "no" -- but I'm curious if that's changed. Have there recently been any high profile examples of fraud through crowdfunding sites?
Can we actually prove fraud in any of these cases, though? I'm not saying it can't happen, or that it hasn't happened. But we should never attribute to malice what can be more readily attributed to stupidity. I'm more inclined to believe that a bunch of people got in over their heads than that a bunch of people intentionally scammed backers.
I may be wrong. But can someone point to some concrete examples? Fraud is a pretty heavy charge to level against Kickstarter projects, and it's also an indirect accusation that Kickstarter is a hotbed of such activity.
Yeah, this seems to be something of a gray area. Not quite fraud, but heading very pointedly in that direction. Perhaps someone more familiar with relevant law knows of a term? Or maybe we should start thinking about inventing one.
> Can we actually prove fraud in any of these cases, though?
Is this the standard we want?
If you used an investment service which said "we require proof beyond all reasonable doubt of criminal endeavors before taking down [some UGC]," how much would you trust those investments? What if the standard for takedowns was a bit higher?
Proof beyond all reasonable doubt is a lovely standard for a criminal justice system. Note that it is not used in civil suits in America - only criminal cases.
We're not talking about taking away people's freedom here. We're talking about an investment website.
Some level of proof is still necessary, though. Not just an accusation.
In general with Kickstarter failures current and future, I think we'll find the evidence weighs heavily in favor of incompetence rather than malice. There's no shortage in the world of business ventures that are honest to goodness failures.
> Some level of proof is still necessary, though. Not just an accusation.
Is anyone arguing that mere accusations should result in kickstarter takedowns? You make a good point... just a sort of obvious one.
This is clearly a hard problem, and neither extreme of "proof beyond reasonable doubt" or "accusation = takedown" works. Maybe that's why this space is so unexplored! That doesn't absolve Kickstarter from having to discover the palatable middle ground.
Hard work is hard, and I think today's announcements are part of that hard work. So I say: keep it up, Kickstarter!
You seem to have misunderstood "mere accusations."
Takedowns due to "mere accusations" to me means that I can fire off an e-mail if I see a kickstarter project that looks sketchy and have it taken down post-haste.
Well if it's based on this: http://news.ycombinator.com/item?id=4549792 then Kickstarter should take it down. It's a civil matter, so there's no "beyond reasonable doubt" required, and if Kickstarter are helping fund infringement, then they're on the hook too.
Is there actually a legal basis for this? As in, if Stripe was, in good faith, processing payments for a company which is selling (allegedly) infringing products, they're obligated to stop processing payments immediately? It seems like there'd be a clause in the TOS to indemnify them.
They didn't just take it down - they left no way for anyone to find out what had happened to the project by looking at the Kickstarter site. There's just a page saying the project doesn't exist anymore for some unspecified reason.
The question is not, did X commit fraud. The question is, "can fraudsters abuse the system maliciously?", and "can incompetents unintentionally abuse it?".
Since the answer is clearly "yes" - then taking some steps to reduce the impact of these vulnerabilities seem reasonable. If you are selling a product, show us the product. If you do not have a product, we want to be sure the backers know this.
People suggesting something unethical need be illegal are part of the issue. In the USA there is a tradition of aggressive play within the rules. If we want to bend the rules [1] a bit -- and make no mistake, that is kickstarter and crowd-sourcing -- there needs to be some ethical nous in place. Both by the companies and the supporters.
[1] The reason US required QUIbs and the SEC and the related regulatory structure (re: financial investment contracts) is precisely to create such bright line playing fields. But these lines are sufficiently complex to require a "price of admission".
Wanting to prevent campaigns that will end in failure due to "stupidity", or even people who "got in over their heads" is just as valid as wanting to prevent fraud.
Kickstarter's image/brand will be hurt by poorly executed campaigns that fail for whatever reason, so it's in their best interest to keep those to a minimum.
I've thought for a while now that Kickstarter should have upper bounds for funding to prevent people from unwittingly accepting too much money and forcing the scale and scope of their project to change. Once a project is 200% funded, stop allowing more backers.
I had a similar thought, that rewards should only be granted while you're under the funding target. If you want to pile on later to make sure the project has the best chance it can? Fine, but no reward - that goes to the people who actually made it possible at all.
Yes, but that doesn't stop people from adding more slots than they can realistically handle.
The skills, knowledge, and resources to produce 1k widgets is totally different than producing 1MM widgets. I might be able to brute-force manufacture 1k widgets from my garage and that would kickstart the business if that's my skill and scale estimate. I need staff, facilities and a different type of supplier if I need to make millions, and I may not have what it takes to deliver on that.
I don't disagree, but the cause of an unshipped product matters. If people believe Kickstarter campaigners are naive, that's one thing; they'll proceed with a bit more caution. If people believe that Kickstarter campaigners are intentionally trying to screw them over and run off with their money, that's another thing entirely. The former erodes trust in individual Kickstarter camaigners; the latter erodes fundamental trust in the site itself.
True, Kickstarter should be trying to address the issue, regardless of its cause. But let's be careful before leaping to the conclusion that people have been acting in bad faith.
> But we should never attribute to malice what can be more readily attributed to stupidity.
I don't know. On the other hand, if you leave a loophole in a system, it will be exploited; that's a basic human law. So in this case I'd guess both scenarios occur - there are so many assholepreneurs out there trying to find a way to "creatively" earn money that I wouldn't be surprised if those design scams were occuring more and more often.
There is a world of difference between a physical working prototype and product that you can deliver in commercial quantities.
I guess Kickstarter is aiming to fund physical projects that already have a working prototype and require funding to deliver in large quantities.
It seems fair to me, as the person requesting funding should be required to have put in a fair amount of effort beyond a flashy 3 minute video promising the world. A working prototype seems to be a fair bar.
I think that Kickstarter is happiest with the things like ElevationDock - a fully functional prototype, that they just had to figure out how to manufacture in large quantities.
They certainly had their challenges - but would have had no chance without a big group of people ordering up front.
I don't think it says anywhere that the prototype has to work. I'm reading this in a way that says I have to show what I've already accomplished. It is ok if the prototype doesn't work yet, and I think it is ok to expect the project creators to do some of the work before they create a kickstarter project.
That's kind of the point. The fact that you have to show the prototype allows potential backers to make a judgement about whether they think you are likely to succeed or not.
Cynically, I wonder if this policy change was not prompted by Kickstarter's own doubts about the lifx team being able to deliver. After all, this is the same team that couldn't meet demand for their custom cardboard box project.
I wonder if in the future there will be a requirement to limit the number of backers on every project. Logically there seems to be a point where additional money from backers over what was asked for leads to difficulty delivering at all.
For instance, say I could make 10 custom widgets a month at $100 a piece. I might decide to launch a Kickstarter project asking for $1200 to gauge if at least 10 other people are interested in my fancy innovative widget. What happens if I end up raising $12000? My target of 20% profit on each widget is no longer possible unless the backers are willing to wait up to 10 months for me to deliver. The only other option is to invest money into producing widgets in larger volume to meet this initial demand. That investment would only make sense if there were some reasonable expectation that demand would stay at the same level after the Kickstarter project ended.
So back to my original cynicism, maybe Kickstarter sees signs that some very good marketers are having enormous success with Kickstarter projects whilst being in completely over their heads...
Your suggestion that there be a "limit to the number of backers on a project" would have probably saved the elevation dock guys some grief. On the other hand, I want the Planetary Annihilation guys (Digital Product) to have HUGE oversubscription - we got funding for Metal Worlds, Water Worlds, Galactic War, and an Orchestra Score through extra funding!
They could easily set up a bullpen of 5 projects to soak up extra funding. It is completely pointless to fund a project over its budget. The project can change its budget and plan/promise of they want to raise more.
I agree that they needed to do something. That something is totally not this. This feels like they want to do whatever is the least amount of work.
Kickstarter is supposed to be a service, for a share of the income they are supposed to facilitate the connection between creators and audience. Rubber stamping an increasingly bureaucratic set of rules is not the way to do this.
A better solution would have been to add the ability for prospective supporters to voice queries and concerns where they could be seen prominently on the page. Right now it seems the creators receive questions and pick the ones they want to answer and place an update answering the questions.
Even better would be to have Kickstarter assess the creators claims on their ability to deliver and assess queries raised by prospective supporters. That would be a real service offering real value, it would also cost real money. Right now Kickstarter's revenue comes from the fact that Kickstarter is popular. The thing that makes creators choose Kickstarter over another platform is almost entirely due to prominence. That cannot be sustained. Eventually it will have to rest on quality of service. The current set of changes do not increase the quality of service.
Even better would be to have Kickstarter assess the creators claims on their ability to deliver and assess queries raised by prospective supporters.
I can't imagine that will ever happen. If they vetted projects or teams, it would probably put some liability on their shoulders. They are going to do everything they can to prevent that.
Something must be done or their (kickstarter's) business may collapse. Banning renderings will probably cut down a bit on expectations not matching delivery, which presently is a problem. Quite a few projects seem to have underestimated the difficulties of quality control and mass production.
However, it is still pretty easy to get a nice milled or extruded aluminium block and call it a prototype so I don't think it will completely eliminate unscrupulous frauds.
Yeah but that "prototype" may not look nearly as amazing as a flashy 3D animation.
Is what kickstarter asking that unreasonable? (other than their lawyers probably told them do this now or suffer consequences that could mean no more business.) If someone can't produce a physical prototype of an item, do they really deserve hundreds of thousands or a million dollars?
If the problem is that people who see realistic renderings feel that the product already exists, a hand-drawn (but still accurate) rendering would allow people to see that the owner sort of knows what they're doing without getting their hopes up. Maybe the same would apply to detailed plans, or other obviously-not-the-product visual design documentation.
That's not true. You can demonstrate prototypes. What you can't do is just whip something up in Blender, do a nice rendering, and then start selling it with with the rewards being "1 widget, 2 widgets, 5 widgets, 10 widgets, 20 widgets", with no indication that you've actually done your homework to say if this is even possible.
They want people to actually have some sort of prototype, something to show for their work, rather than just a slick graphical presentation and reward system that implies that it's far closer to completion than it actually is.
I think they are right in being careful. It's about time.
I use Solidworks for mechanical design and Modo for photorealistic rendering. I assure you that, with enough skill and effort, one can make photorealistic renderings that, to the uninformed, look like the product is ready to go and that the funding is a mere formality. No, Kickstarter did the right thing here.
That said, I am hoping that they will allow 3D renderings and animations as added illustrations if and ONLY if one shows actual realized versions of the proposed hardware in the project. The reason I say this is that 3D renderings and animations are extremely useful tools for the communication of function and some ideas that might be hard or impossible to convey using actual hardware. A good example is a cross-sectional cut showing moving parts.
I tend to agree with you. They just need to stop the project guys asking for "pre-order" types of donations. Or make them not send the product to the backers for that they're paying.
It should be 100% clear that it's just a donation, whether it's $10, $100 or $1000. But you're not getting any product for that donation, until the product launches, when you can go and buy it.
I think we're just going to see a rise in more "architectural" styled development renderings, over fully polished marketing-style imagery. I welcome that.
Personally, I would prefer a hybrid approach--projects cannot show only simulations/rendering. If a project presents these things, it must also present the current state of the ideas being rendered.
You're developing a spacefaring action game? By all means, show me that you want to have planets, stars, and space pirates--but if all you have right now is a spaceship object floating in an environment without a skybox, I want to see that, too.
Renderings seem useful in helping viewers visualize what the goal is. Maybe instead they should enforce that renders have to have an accompanying text disclaimer? Kind of like medicine commercials and their side effects.
This is a good idea, kudos to them for making this move to help alleviate a lot confusion on behalf of funders.
I think what they need to do is have milestones for their project that can get vetted by Kickstarter. For each milestone they hit, more funds get released to them. This will allow funders to get out if they keep missing their milestones, and the project looks like it's going downhill.
I think "Product renderings are prohibited", and to a lesser extent "Product simulations are prohibited", run against the emphasized goal being "a new way for creators and audiences to work together to make things".
When something doesn't yet exist, you have to present speculative representations to communicate (or even rationally discuss!) the vision. That goes double for a wider audience, which may not be as accustomed to letting their imagination range over exotic possibilities.
Such mockups should be clearly labeled, and placed alongside current-best-prototype representations for comparison, and disclaimerized as with the new 'Risks and Challenges' requirement.
But before Kickstarter, more traditional investors and prepurchasers -- and indeed internal organization R&D and product-development processes -- would use and expect such representations for design communication. Why cripple the new model with this encumbrance?
These guys are New York, and it seems like their leagal-eagle's have raised some concerns. This does not smell like bus-dev, or pr, or typical CEO brainstorming at work. so, it would be very fascinating to see what they are seeing internally. we can speculate, but that's not likely going to get us the same look at the situation.
I disagree. If huge product failures/not-quite-scams-but-might-as-well-be keep happening, people will loose faith in the Kickstarter brand. This is them protecting themselves, and their community.
If the real motive is to prevent scams/failures-to-deliver, that's OK. But that's almost the opposite concern from the headline -- "not a store" -- about just using Kickstarter as a channel for moving already-developed, riskless product inventory.
Agreed, what annoys me more in kickstarter are projects that use it as a way to get preorders. Existing a finished product or not to me seems to go away from funding the project its just a way to buy and sell
For software products, it's pretty hard for them to tell the difference between a simulation/rendering and the real thing. If I show a finished UI, it will appear to be fully functional and polished, but there may not be any back-end at all. I often create a fake persistence layer to allow for faster development of the UI. How would they be able to tell the difference? And it's actually not violating the rules at all right?
From the comments in the linked blog, there was this comment "The new guideline prohibiting renderings applies only to projects categorized as Product Design or Hardware. Other categories, including Games, are not affected."
There are a bunch of obvious technical mistakes in that, not least of which is that you're not effectively buying a WeMo and getting the bulb for free; only the more expensive master bulb will have WiFi support and the rest will talk to it over much cheaper 802.15.4 mesh networking.
I also think that delivered software is a product. I doubt kickstarter would allow SaaS at all (it would be interesting to see what kind of products get rejected during the submission reviews).
I find it fascinating how Kickstarter is starting to adopt some of the same cautions that we see in an S1/Prospectus, "“What are the risks and challenges this project faces, and what qualifies you to overcome them?”"
As a long time burner, it was interesting to me how year after year, the playa adopted many (but not all) of the rules, regulations, restrictions of the outside world. We had a DMV (Department of Mutan Vehicles), Building Regulations (for buildings over a certain height), developed clinics, and ambulance services - etc...
It will be interesting to see, over time, how kickstarter adopts many of the SEC mandated governance over new enterprises going to the market for funding.
I'm sure a LOT of people watched that video, and thought that the LIFX lightbulb exists (or almost exists) in it's current incarnation. Also, there are a lot of people supporting for $500 in the belief that they'll get 10 lightbulbs - I wonder how many of those backers don't realize their is a better than even chance that this project will come to nothing, and they'll get nothing but good feelings for their money?
When Ouya raised over a million dollars within 24 hours a few weeks ago, they specifically wrote: "In just 24 hours, 20,000 people bought an Ouya console"[0]. They should be more careful with their choice of words in the future if they really want to reflect that "Kickstarter is not a store".
The change in terminology would seem to imply that Kickstarter is now wising up to the fact that there will inevitably be a high profile failure to deliver in the near future and is now trying to preempt criticism against Kickstarter not laying out clearly enough the risks involved in backing a project.
I welcome this change and think that it will help in the long run.
People are used to big software budgets producing nothing.
It's an entirely different value proposition failure when they paid $100 expecting to receive a light bulb or gaming console only to end up empty-handed.
Destroying Facebook was never what they promised. They promised an alternative. What they delivered was in line with the amount of funding they received.
> The project wasn't a failure. It just didn't take.
A social network with no users isn't a failure! It just didn't take! It's just like when you take antibiotics but they don't do the trick. Definitely worth the 200k in the end!
Not to mention active, ongoing development, including regularly adding new features and a several hundred thousand strong community. It's not a Facebook-killer, but it's a reasonable social network as-is.
Isn't it the case that kickstarter isn't necessarily a store? Many projects explicitly guarantee that you will receive a certain item, and some are even already manufacturing and selling the items but appear to just be using kickstarter because of its prominence and trendiness.
I'm sure kickstarter isn't liable even for the projects that explicitly promise delivery, so it's still not quite a store in those cases, but I assume that kickstarter doesn't prohibit projects from offering actual preorders.
1. Projects are over-promising and under-delivering
2. Kickstarter isn't a store and was never meant to be one. People have turned it into one, leading to all sorts of issues, including point #1
I think when you are asking for examples of abuse you are thinking of the first point, but the 'no multiple products' rule addresses #2. You aren't buying a product, you are backing a project. If you want multiple lightbulbs, presumably you can purchase them after the project is funded.
In other words, I don't think the rule is to prevent abuse, it's to bring kickstarter back to its roots and remind people what kickstarter is all about. It may hurt some projects but hopefully it will revert kickstarter to its original niche where it was adding a lot of value.
Of course, since LIFX is planned as a networked bulb you can't actually get the full functionality of it if you just order one. Also, for some of the smaller Kickstarter hardware projects the creator actually has no intention of launching them as a commercial product at all - they're essentially group buys allowing hobbyists to offer something they've designed to other hobbyists for less than the cost of building it themselves.
something I noticed with some of the more "store-like" products (things that only use Kickstarter for money to mass produce and not development) is they have bulk options: $10 for 1, $100 for 15 "for retail distribution".
I find it funny how the Oculus Rift's front image is a rendering, and not because they can't do it. But because they want you to see the final design that they have created.
This is a sensible list of new rules. This is a quintessential exercise in changing user expectations and behavior. This is great UX, especially in a platform-type environment in which the platform managers aren’t always able to curate the content created by the platform users.
No simulations or renderings to show the vision that's being pursued? Beyond stupid. It's insane.
I'd speculate that it's probably a requirement driven by lawyers worried about failed projects conferring some kind of liability onto Kickstarter itself.
Smart move. AirBnB waited until scandal broke out and then tried to put out the fire. We were/are dangerously close to a major scandal happening on Kickstarter.
That's a start, but I still think that allowing hardware projects to offer arbitrary, open-ended numbers of end-product rewards is a mistake. Suddenly being expected to produce 100 times as many units as you planned is not, as people so often say "a good problem to have". It's just "a problem".
Yes, the general tendency is for marginal cost to decrease as production quantity increases, but that does not mean that it's a smooth curve. Instead, the line is jagged, littered with points where large investments need to be made. For an open-ended product, you get investors, hire extra people, buy equipment, etc. You'll end up taking a short-term loss that will be earned back in the long term. For a close-ended project like Kickstarter allows, you'll have the short-term loss, but no long-term profit.
And that's if you have experience and connections to pull off manufacturing and courting investors. If you're hawking a project on Kickstarter, it's pretty likely that you have neither.
This was becoming a real issue for Kickstarter. Many of the recent high profile 'projects' were companies (particularly game developers/publishers and consumer products manufacturers) effectively taking pre-orders through Kickstarter and using those funds to develop the product. As the channel through which the orders were placed (and the party that that receives the money and takes a cut), I think a good legal argument could be made that Kickstarter is a store, and thus would have to comply with the UCC and other laws (including the various Deceptive Trade Practices acts across the country) applying to retail.
The ban on mutliple rewards is interesting. While there have been no tears shed over ~$1000 going to finance the Makey Makey project, there's a mildly awkward silence every time we try to figure out what we're going to do with 30 of them. It's also true that cannibalizing a old keyboard would have delivered the same functionality...
Though I completely understand where kickstarter is coming from with their decision, I have a bit of a gripe with their choice to prevent projects from showing renderings and requiring actual photos.
Correct me if I'm wrong, but the last time I checked the purpose of kickstarter was to help people get their ideas off the ground. Some types of products, especially hardware, can cost a lot of money to produce at a prototype stage. Not everyone has the cash lying around to spend hundreds, if not thousands of dollars to build a functional prototype. So normally what that person would do is put together some renderings and a video and go to kickstarter to raise the funds to expand into prototypes and production. Now what are they to do?
Ultimately I think this decision by kickstarter gives a tremendous advantage to design shops with the budgets to build prototypes, while leaving the little guy behind.
I understand the problem that the Kickstarter founders are facing, but I don't think this is the right (or even close to the correct) solution. Despite saying "kickstarter is not a store" in the title, their rules basically force project creators to physically show exactly what they're planning to deliver...making it even more of a store.
Thanks! Working 24-7 to get these watches out, blogging here: kickstarter.com/projects/597507018/pebble-e-paper-watch-for-iphone-and-android/posts/
Congrats on Pebble so far. Sorry, I can't see what would prohibit the project here? Maybe the language would need to be more restrained, but I doubt that would harm the funding too much.
You think so? My mind went to your project when I saw the OP. I heard second-hand that you guys were showing off a prototype at Google I/O which consisted of the watch casing with a display connected to external (not yet miniaturized) electronics. This seems to fit Kickstarter's new regulations. Would something like this not have been possible before you got funded?
The reason I felt comfortable backing guys is because you guys had already delivered a product to market. A description or early prototype demonstrating what you were trying to make - almost exactly what I had pictured as my ideal smartwatch before you launched - and my wallet would have been open.
I was thinking the same thing. If you limit rewards to '1' of the product you won't have any $1,000 or $5,000 backers. Hard to get to $1M at $100 a throw.
Backing a project and pre-ordering a product are two different things - and kickstarter doesn't want to get involved in the second part.
If you're mature enough to really start accepting preorders with a guarantee of delivery, then put up your product for sale. If you don't yet have a product to sell - that's what kickstarter is for, but then it is not a sale/preorder with a volume discount, but backing of a venture that might deliver something else, or nothing at all - i.e., you get to be an investor, not a customer.
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[ 900 ms ] story [ 3460 ms ] threadI do hope that it doesn't keep products that are in a rough state from being able to be successful, though if somethings really that complex that you need to raise a lot of money to have a marketable prototype, let alone bring it to market, I don't think Kickstarter donations are the way to fund it.
As programmers, we often try and fix things with code, but it's cool to see Kickstarter improve their product by thinking about what questions the creators should be asking. I also agree that hardware makers do themselves and other a disservice by showing space age renderings of their products.
This is how every company should operate. And this will definitely improve their long-term shape and revenues.
They needed to make some sort of move, but banning simulations and renderings (Really?) seems to be terrible overkill.
If anything, this move makes it much more a store. You can only put up products that exist. There's no funding of development.
Not sure this is a good solution on their part.
EDIT: Fully in support of the "Risks and Challenges" section. Makes it like an investment prospectus.
I may be wrong. But can someone point to some concrete examples? Fraud is a pretty heavy charge to level against Kickstarter projects, and it's also an indirect accusation that Kickstarter is a hotbed of such activity.
Is this the standard we want?
If you used an investment service which said "we require proof beyond all reasonable doubt of criminal endeavors before taking down [some UGC]," how much would you trust those investments? What if the standard for takedowns was a bit higher?
I'd say so, yes. Ei incumbit probatio qui dicit, non qui negat
http://en.wikipedia.org/wiki/Innocent_until_proven_guilty
Proof beyond all reasonable doubt is a lovely standard for a criminal justice system. Note that it is not used in civil suits in America - only criminal cases.
We're not talking about taking away people's freedom here. We're talking about an investment website.
In general with Kickstarter failures current and future, I think we'll find the evidence weighs heavily in favor of incompetence rather than malice. There's no shortage in the world of business ventures that are honest to goodness failures.
Is anyone arguing that mere accusations should result in kickstarter takedowns? You make a good point... just a sort of obvious one.
This is clearly a hard problem, and neither extreme of "proof beyond reasonable doubt" or "accusation = takedown" works. Maybe that's why this space is so unexplored! That doesn't absolve Kickstarter from having to discover the palatable middle ground.
Hard work is hard, and I think today's announcements are part of that hard work. So I say: keep it up, Kickstarter!
Yes, it should - if it's backed by a legal letter, Kickstarter might be liable too, if the suit is sucessful.
Takedowns due to "mere accusations" to me means that I can fire off an e-mail if I see a kickstarter project that looks sketchy and have it taken down post-haste.
To me, that is highly suboptimal.
Since the answer is clearly "yes" - then taking some steps to reduce the impact of these vulnerabilities seem reasonable. If you are selling a product, show us the product. If you do not have a product, we want to be sure the backers know this.
[1] The reason US required QUIbs and the SEC and the related regulatory structure (re: financial investment contracts) is precisely to create such bright line playing fields. But these lines are sufficiently complex to require a "price of admission".
The skills, knowledge, and resources to produce 1k widgets is totally different than producing 1MM widgets. I might be able to brute-force manufacture 1k widgets from my garage and that would kickstart the business if that's my skill and scale estimate. I need staff, facilities and a different type of supplier if I need to make millions, and I may not have what it takes to deliver on that.
True, Kickstarter should be trying to address the issue, regardless of its cause. But let's be careful before leaping to the conclusion that people have been acting in bad faith.
I don't know. On the other hand, if you leave a loophole in a system, it will be exploited; that's a basic human law. So in this case I'd guess both scenarios occur - there are so many assholepreneurs out there trying to find a way to "creatively" earn money that I wouldn't be surprised if those design scams were occuring more and more often.
http://betabeat.com/2012/04/this-is-what-a-kickstarter-scam-...
I guess Kickstarter is aiming to fund physical projects that already have a working prototype and require funding to deliver in large quantities.
It seems fair to me, as the person requesting funding should be required to have put in a fair amount of effort beyond a flashy 3 minute video promising the world. A working prototype seems to be a fair bar.
They certainly had their challenges - but would have had no chance without a big group of people ordering up front.
I wonder if in the future there will be a requirement to limit the number of backers on every project. Logically there seems to be a point where additional money from backers over what was asked for leads to difficulty delivering at all.
For instance, say I could make 10 custom widgets a month at $100 a piece. I might decide to launch a Kickstarter project asking for $1200 to gauge if at least 10 other people are interested in my fancy innovative widget. What happens if I end up raising $12000? My target of 20% profit on each widget is no longer possible unless the backers are willing to wait up to 10 months for me to deliver. The only other option is to invest money into producing widgets in larger volume to meet this initial demand. That investment would only make sense if there were some reasonable expectation that demand would stay at the same level after the Kickstarter project ended.
So back to my original cynicism, maybe Kickstarter sees signs that some very good marketers are having enormous success with Kickstarter projects whilst being in completely over their heads...
If all they do is port some small portion of Planetary Annihilation forward, then I'll be happy.
If they actually deliver on 50% of what they've promised + Orchestral Score - I'll be beyond happy.
I spent a good portion of 1997/1998 playing Total Annihilation.
Kickstarter is supposed to be a service, for a share of the income they are supposed to facilitate the connection between creators and audience. Rubber stamping an increasingly bureaucratic set of rules is not the way to do this.
A better solution would have been to add the ability for prospective supporters to voice queries and concerns where they could be seen prominently on the page. Right now it seems the creators receive questions and pick the ones they want to answer and place an update answering the questions.
Even better would be to have Kickstarter assess the creators claims on their ability to deliver and assess queries raised by prospective supporters. That would be a real service offering real value, it would also cost real money. Right now Kickstarter's revenue comes from the fact that Kickstarter is popular. The thing that makes creators choose Kickstarter over another platform is almost entirely due to prominence. That cannot be sustained. Eventually it will have to rest on quality of service. The current set of changes do not increase the quality of service.
I can't imagine that will ever happen. If they vetted projects or teams, it would probably put some liability on their shoulders. They are going to do everything they can to prevent that.
However, it is still pretty easy to get a nice milled or extruded aluminium block and call it a prototype so I don't think it will completely eliminate unscrupulous frauds.
Is what kickstarter asking that unreasonable? (other than their lawyers probably told them do this now or suffer consequences that could mean no more business.) If someone can't produce a physical prototype of an item, do they really deserve hundreds of thousands or a million dollars?
That's not true. You can demonstrate prototypes. What you can't do is just whip something up in Blender, do a nice rendering, and then start selling it with with the rewards being "1 widget, 2 widgets, 5 widgets, 10 widgets, 20 widgets", with no indication that you've actually done your homework to say if this is even possible.
They want people to actually have some sort of prototype, something to show for their work, rather than just a slick graphical presentation and reward system that implies that it's far closer to completion than it actually is.
I use Solidworks for mechanical design and Modo for photorealistic rendering. I assure you that, with enough skill and effort, one can make photorealistic renderings that, to the uninformed, look like the product is ready to go and that the funding is a mere formality. No, Kickstarter did the right thing here.
That said, I am hoping that they will allow 3D renderings and animations as added illustrations if and ONLY if one shows actual realized versions of the proposed hardware in the project. The reason I say this is that 3D renderings and animations are extremely useful tools for the communication of function and some ideas that might be hard or impossible to convey using actual hardware. A good example is a cross-sectional cut showing moving parts.
It should be 100% clear that it's just a donation, whether it's $10, $100 or $1000. But you're not getting any product for that donation, until the product launches, when you can go and buy it.
You're developing a spacefaring action game? By all means, show me that you want to have planets, stars, and space pirates--but if all you have right now is a spaceship object floating in an environment without a skybox, I want to see that, too.
I think what they need to do is have milestones for their project that can get vetted by Kickstarter. For each milestone they hit, more funds get released to them. This will allow funders to get out if they keep missing their milestones, and the project looks like it's going downhill.
When something doesn't yet exist, you have to present speculative representations to communicate (or even rationally discuss!) the vision. That goes double for a wider audience, which may not be as accustomed to letting their imagination range over exotic possibilities.
Such mockups should be clearly labeled, and placed alongside current-best-prototype representations for comparison, and disclaimerized as with the new 'Risks and Challenges' requirement.
But before Kickstarter, more traditional investors and prepurchasers -- and indeed internal organization R&D and product-development processes -- would use and expect such representations for design communication. Why cripple the new model with this encumbrance?
DO NOT ALLOW listings to offer the product described as a reward.
Will solve the problem entirely, guaranteed.
Rewards: $180 A new Android-based game console.
If someone is really behind the concept for a product, they can just buy the product after it's available in an online store.
I could easily see this becoming a legal requirement if it gets visible to legislature.
The way Kickstarter presents itself, it's neither - it's not an investment; it's a way for creators and consumers to collaborate on a project.
That's subtly different from an investment per se,
(Whether you agree with that is a different question, but it's important to note how Kickstarter intends to portray itself).
which came from Kickstarter's community manager.
It seems fairly clear to me that they are just trying to prevent these kind of shenanigans: http://blogs.reuters.com/felix-salmon/files/2012/09/bulbs.jp...
http://blogs.reuters.com/felix-salmon/2012/09/18/kickstarter...
As a long time burner, it was interesting to me how year after year, the playa adopted many (but not all) of the rules, regulations, restrictions of the outside world. We had a DMV (Department of Mutan Vehicles), Building Regulations (for buildings over a certain height), developed clinics, and ambulance services - etc...
It will be interesting to see, over time, how kickstarter adopts many of the SEC mandated governance over new enterprises going to the market for funding.
Reading through all the regulations though - it feels like 90% (100%?) are in response to this: http://www.kickstarter.com/projects/limemouse/lifx-the-light...
I'm sure a LOT of people watched that video, and thought that the LIFX lightbulb exists (or almost exists) in it's current incarnation. Also, there are a lot of people supporting for $500 in the belief that they'll get 10 lightbulbs - I wonder how many of those backers don't realize their is a better than even chance that this project will come to nothing, and they'll get nothing but good feelings for their money?
[0] http://www.kickstarter.com/blog/ouyas-big-day
I welcome this change and think that it will help in the long run.
http://www.kickstarter.com/projects/196017994/diaspora-the-p...
It's an entirely different value proposition failure when they paid $100 expecting to receive a light bulb or gaming console only to end up empty-handed.
https://www.joindiaspora.com
https://github.com/diaspora/diaspora
Not saying they didn't succeed, just that there are similar lessons about expectations there.
A social network with no users isn't a failure! It just didn't take! It's just like when you take antibiotics but they don't do the trick. Definitely worth the 200k in the end!
I'm sure kickstarter isn't liable even for the projects that explicitly promise delivery, so it's still not quite a store in those cases, but I assume that kickstarter doesn't prohibit projects from offering actual preorders.
I think they've been pretty clear about this.
1. Projects are over-promising and under-delivering
2. Kickstarter isn't a store and was never meant to be one. People have turned it into one, leading to all sorts of issues, including point #1
I think when you are asking for examples of abuse you are thinking of the first point, but the 'no multiple products' rule addresses #2. You aren't buying a product, you are backing a project. If you want multiple lightbulbs, presumably you can purchase them after the project is funded.
In other words, I don't think the rule is to prevent abuse, it's to bring kickstarter back to its roots and remind people what kickstarter is all about. It may hurt some projects but hopefully it will revert kickstarter to its original niche where it was adding a lot of value.
eg Scanbox: http://www.kickstarter.com/projects/limemouse/scanbox-turn-y...
I'd speculate that it's probably a requirement driven by lawyers worried about failed projects conferring some kind of liability onto Kickstarter itself.
http://techcrunch.com/2011/07/27/the-moment-of-truth-for-air...
Yes, the general tendency is for marginal cost to decrease as production quantity increases, but that does not mean that it's a smooth curve. Instead, the line is jagged, littered with points where large investments need to be made. For an open-ended product, you get investors, hire extra people, buy equipment, etc. You'll end up taking a short-term loss that will be earned back in the long term. For a close-ended project like Kickstarter allows, you'll have the short-term loss, but no long-term profit.
And that's if you have experience and connections to pull off manufacturing and courting investors. If you're hawking a project on Kickstarter, it's pretty likely that you have neither.
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Correct me if I'm wrong, but the last time I checked the purpose of kickstarter was to help people get their ideas off the ground. Some types of products, especially hardware, can cost a lot of money to produce at a prototype stage. Not everyone has the cash lying around to spend hundreds, if not thousands of dollars to build a functional prototype. So normally what that person would do is put together some renderings and a video and go to kickstarter to raise the funds to expand into prototypes and production. Now what are they to do?
Ultimately I think this decision by kickstarter gives a tremendous advantage to design shops with the budgets to build prototypes, while leaving the little guy behind.
Kuddos on the Pebble project. It's an amazing product, and I can't wait to see you guys release to market. Cheers!
Thanks! Working 24-7 to get these watches out, blogging here: kickstarter.com/projects/597507018/pebble-e-paper-watch-for-iphone-and-android/posts/
The reason I felt comfortable backing guys is because you guys had already delivered a product to market. A description or early prototype demonstrating what you were trying to make - almost exactly what I had pictured as my ideal smartwatch before you launched - and my wallet would have been open.