Fund a Kickstarter without losing your money—or your mind
Bring your common sense to crowdfunding.
The crowdfunding website Kickstarter is a fantastic showcase for innovation and creativity. Through its interface, you can financially support the independent creators who make music, movies, and gadgets. In exchange, those creators promise you everything from swag to the final versions of their still-in-development music, movies, and gadgets.
While many people treat Kickstarter like an online shop—you fund a product that’s still in development now, and receive that product later—you don’t necessarily get what you pay for: Even projects that reach their funding goals can fall short of their creative goals. “Kickstarter does not guarantee projects or investigate a creator’s ability to complete their project,” reads a statement on the website. “It’s the project creator’s responsibility to complete their project.” In other words, you can’t blame Kickstarter, or get your money back, if the campaign you funded fails to deliver on its promises.
So how can you be sure that the project you entrust with your hard-earned cash will come to fruition? You have to choose your Kickstarters wisely. While it’s impossible to guarantee which projects will succeed and which will fail, you can follow some common-sense rules, and do some research, to make your crowdfunding investment more likely to pay off.
See if the project has a web presence
To double-check credentials, start by looking up the project’s websites and social media feeds, if it has any. You can also search out the web presence of the company or individuals that created the campaign. If they’re not visible online, that’s a big red flag.
While you’re browsing, examine the Kickstarter listing itself. Does the page look like it was written and designed by professionals? Is the promotional video high-quality? If these people know what they’re doing, they’re more likely to provide polished, informative video and text descriptions
Look into the creators
As Kickstarter itself advises, the background and the history of the people who run a campaign can indicate its likelihood of success. Most listings will include details about the company or individuals behind the project. So check up on what they’ve done in the past, where their expertise lies, and how many years they’ve been in business. If you can, also look up what the creators have been doing up until this point and any projects they’ve worked on in the past.
For example, are these experienced industry veterans or amateurs with a bright idea? Have they worked on tech like this before? Newcomers can certainly create a product that’s viable and successful, and even former Google or Apple executives won’t always hit a homerun. But you should bear the creators’ experience—or lack thereof—in mind before you part with your money.
You can also see if the creators themselves have backed other Kickstarters by clicking on their usernames on the top-left of the listings page. This indicates whether they have experience with the crowdfunding platform, which is always a welcome sign.
Note: There’s a distinction between hardware and software projects. If you’re considering backing a physical gadget, you should be aware that this requires a lot more effort, energy, and logistics expertise, involving supply chains and materials. Which means the people who are running this type of campaign really need solid hardware experience. In comparison, even a complex software project like a video game lacks the requirement for, say, shipping arrangements. So it takes less experience to pull off this type of project.
Review the science
We’ve mentioned that hardware projects require a lot more effort to pull together and therefore need a lot more scrutiny from you. In addition to examining the creators, you need to ask: Does the science behind the project make sense for a viable product?
Take the Triton Gills crowdfunding campaign. It promised 45 minutes of uninterrupted underwater breathing without heavy equipment, despite repeated claims from experts that such a device was scientifically impossible (unless you’re a fish). Eventually, Kickstarter closed down the project and forced it to refund backers’ money. If a gadget seems too good to be true, consider this: Why is it on Kickstarter? Often, breakthrough tech doesn’t need a crowdfunding campaign, because its inventors earn financial investment from seasoned industry professionals.
You don’t have to be an electronics expert to work out how scientifically viable a project is. You just need some basic research skills. Look at the comments other Kickstarter users are leaving on the page and check for warning signs. You should also see whether the project has gotten news coverage in the tech press. Finally, you can also click Contact me on any creator page to ask your own questions.
Another useful barometer is the promo video. View it critically to suss whether the creators have actually developed a working prototype or they’re still designing the hardware. If all they show are 3D renders of what the finished product might look like, or mock-ups made of cardboard, then be wary of throwing your life savings at it.
Every Kickstarter listing has a “Risks and challenges” section where the creators are obliged to list potential bumps in the road. Read this carefully. If you have any doubts, you can always wait until the product actually does launch and buy it then. On the other hand, you may miss out on an early-bird discount as a result.
Scope out the competition
If the creators seem legit, and the product seems viable, considerwhether or not there’s a market for the product. Are Google, Apple, or Microsoft making their own versions of this Kickstarter gadget, rendering it redundant before it hits production lines?
Smartwatch startup Pebble enjoyed the most well-funded Kickstarter campaign of all time, and backers did indeed get the products the company had promised. But within two years of its crowdfunding campaign’s launch, Pebble was acquired by wearables giant Fitbit. As a result, Pebble could only offer limited ongoing support for the software driving its smartwatches.
Pebble exemplifies a problem that goes beyond Kickstarter: It’s extremely difficult for smaller tech firms to make a dent in the market. Like Pebble, the compact Ouya games console, which raised more than $8m on Kickstarter, managed to make and ship its product. But within three years, commercial pressures drove the company out of business.
With that in mind, consider whether the project you want to back has long-term viability. Even for expert analysts, this can be difficult. Here’s one strategy: Focus on smaller-scale projects that stay away from what the tech giants are doing. Another option is to limit your support to products that are truly different from everything else on the market, such as the Oculus Rift, which got its start on Kickstarter. You don’t have to spend weeks studying market predictions, but you should acquaint yourself with the other products out there.
Reduce your pledge
If you really like a project, but you notice a few red flags, you can always jump in at a lower pledge level. Many projects offer stickers, t-shirts, and other swag to backers who invest even a few dollars. As long as the creator seems accountable, and the funding goal is met, you should get something for your cash—even if it’s just the knowledge that you’re helping to foster more innovation in the technology industry.
So if an opportunity excites you, go ahead and support it. Just think of that payment as a donation to a company whose vision you like, rather than a down payment on a product.