The drawbacks of the platform are becoming more and more: entrepreneurs bear the moral burden

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Kickstarter platform for more entrepreneurs to get money, but also let them bear a heavier moral burden

Introduction: "The New York Times" Monday article, said Kickstarter, such as the public-funded platform is rapidly developing. On the one hand, the public-funded platform to nurture a number of successful projects, on the other hand, investors have gradually recognized the risks of the public-funded projects.

The following is the full text of the article:

Lower financing threshold

Last December, an idea to develop an iphone aluminum charging base was announced online. The project's sponsors raised nearly 1.5 million dollars through the Kickstarter platform and pledged to provide the elevation dock this April to funders.

Last week, however, Apple announced that the iphone 5 would be designed with a redesigned base interface. Some funders of the project have not received the elevation Dock because of problems with the manufacturing process. A designer is busy designing a connector and upgrading previous products. "I just want to get the product I want before the iphone 6 is launched," one Kickstarter said at the time. ”

The Kickstarter and Indiegogo websites are building links with financial providers for designers and other innovators to help them achieve their innovative dreams. Such services are becoming increasingly popular, and Kickstarter is the largest such site. On the site, nearly 3 million people have funded about 30,000 projects, with a total investment of $300 million.

For project sponsors, getting funding is sometimes easy. But they must turn their dreams into reality and be supervised by funders in the process.

Project or difficult to complete

This new model is likely to create pitfalls that cause both project sponsors and funders to encounter situations they do not want to see. Investors give the project participants full trust and provide them with funds in the hope of achieving future returns. For example, if you invest in a movie, your name will appear in the subtitle. And if you invest 100 dollars in a smart watch project, you can even get the final product.

In most cases, this model works. However, for certain projects, such as larger and more demanding projects, the development of the project may be faulty and protracted. For example, if you want to run a food sales vehicle, you may not be able to get approval. For products such as the elevation Dock, manufacturing and shipping can be more difficult than expected.

This weekend's XOXO festival embodies the rise of the public-chip model. XOXO Festival is a conference focused on public and internet innovation, organized by Kickstarter early employee Andy Bayo (Andy Baio). He also Kickstarter a 400-dollar sale of tickets to attract attention and raise money.

Entrepreneurs are under a lot of pressure

The relationship between innovators and funders is still forming in the public-sponsored Web site. Sponsors play the role of philanthropists, investors and clients. Funders will be dissatisfied when the promised returns are not met on schedule.

Eric Mikikovsky (Eric Migicovsky) presented a smart watch project Pebble on Kickstarter. The watch uses an innovative display, and the project receives more than 10 million of dollars in investment, 10 times times more than he initially expected. "It's certainly going to be stressful," he says. 65,000 people have booked a watch that has not been developed yet. ”

Mikikovsky hired someone else to help him with his e-mail inbox and publish the latest status of the project. 9000 people have emailed him asking about the project. Mikikovsky originally planned to ship the watch this September, but the current delivery time has been postponed. But he declined to announce a specific time delay.

Aissan Moric Mollick, a management professor at the Wharton School of the University of Pennsylvania, said that 75% of the project's design and technology-related projects could not be completed on the Kickstarter, most of which needed to deliver solid products. On the whole, project funders understand this risk and they are willing to wait as long as they get the project's progress information.

Risk is emerging

A company called Fundable is introducing a public-chip model into the venture-capital process. Will Schrott Wil Schroeter, co-founder and CEO of the company, said: "Our honeymoon period around the public is close to completion." It is recognized that investing in early-stage projects is risky. Whether it's an idea, a charity event, or a product. They began to understand that it was not buying things on Amazon. ”

Kickstarter also said the site is not able to complete the project on time, or even the project can be completed. The sponsors of the project are legally obligated to fulfil their commitments, but if they fail to fulfil their commitments, Kickstarter does not have any refund mechanism for the funders. In some cases, the project's author may even be overwhelmed by the patterns of the public.

Diaspora, for example, is a project proposed by 4 college students to develop an open social network that replaces Facebook. Diaspora's initial fund-raising target was $10,000 trillion, but eventually 6500 people took part in the investment, reaching 200,000 dollars. 3 years later, however, they were unable to release the public version of diaspora and handed the code to those willing to continue the work.

Team member Marcos Salzburg (Max Salzberg) said they were plagued by a number of additional things, including replying to emails and making commemorative T-shirts for funders, which led them to have no time to write software. "We thought it was a summer project," he says. We develop the site based on faith, but dealing with many people is troubling us. We are not ready to deal with this situation. ”

Salzburg also said that what made them feel most uncomfortable was that they thought they were wasting money. "It sounds like there's a lot of money, and people always ask, ' Where's the money? '" he says. But the reality is, 2 years, 4 people, we beg everywhere. "Viral transmission will have a negative impact," he said. It was a complete mess. ”

Anticipate problems in advance

Taking steps to help you before a problem occurs. This spring, Kevin Geis, a 41-year-old Kevin Gues, tried to develop a stylus for the ipad and submitted the idea to Kickstarter. "I want to see if I can achieve my goals," he says. But everything is more difficult than I expected. ”

Gues found that he underestimated the cost of manufacturing and the time it took to develop a touch pen. He canceled his initial fund-raising plans, consulted designers and manufacturers, and postponed funding for several months. He eventually raised 35,000 dollars in 3 weeks and delivered the first 1500 pens in a few months.

Some of the projects on the Kickstarter were not ambitious at first, but eventually achieved rapid growth and received millions of of dollars in investment. Yang Xi Stricole Yancey Strickler, a founder of Kickstarter, said the phenomenon was entirely new to Kickstarter, which was established in 2009.

He said the Kickstarter project was initially "looking for sponsorship", but as the product developed to a certain scale, people wanted to set up a company. "It's an economy that's been developed from bit to bit. ”

The elevation dock is the first Kickstarter to raise more than 1 million dollars. Casey Hopkins, the project's Kessi Hopkins, said his company would offer inexpensive connectors to subscribers who had subscribed to the charging base, making the device suitable for the iphone 5.

Hopkins said he was happy to use Kickstarter "to create a company from scratch". "You will be under great pressure in the process of development," he says. But we did well. "At present, the company is about to ship the last batch of 19,000 reserved charging base." (Zhang Fan)