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The Inevitable Crowdfunding Backlash When People Realize Projects Fail & Change | Techdirt
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TheInevitableCrowdfundingBacklashWhenPeople RealizeProjectsFail&Change
fromtheearlyexcitementcanleadtodisillusionmentdept
Innovation by Mike Masnick Wed, Aug 29th 2012 3:11am

We've been unabashed champions of crowdfunding and platforms like Kickstarter for quite some time now, though we've also tried to temper some of the hype. A little over two years ago, for example, we used the story of the open social network Diaspora as a possible warning for some of the initial excitement about projects. Much of that comes from just knowing what entrepreneurs go through: the initial idea is exciting, but things change over time, and expectations change... and some projects fail. When you're dealing with investors, that's one thing they're sort of designed to expect such a thing. But crowdfunding had a different vibe. Because people got so excited in the idea and really (quite literally) bought into it, we worried that as some projects failed, it might lead to a serious backlash. It may be a coincidence that we highlighted this risk with Diaspora (one of the first Kickstarter projects to go really "big") a couple years ago... but it's possible that are worries are coming true. Last week, I saw a report from Liz Gannes at AllThingsD, which suggested that the Diaspora team was focusing on something completely different, a "collaborative web remixing tool" called Makr.io. The team definitely went through some significant hardships so it's not that surprising that they've shifted gears. Given that story, it's hardly a surprise that they've now officially "handing control of the project over to the community." They claim they'll still be playing an important role, but it seems pretty clear this is an effective withdrawal from the project, which never really caught on the way some people hoped. And, of course, this isn't just limited to Diaspora. Bloomberg recently had a (welltimed) story highlighting how an awful lot of successful Kickstarter projects, at the very least, don't meet their deadlines to actually make or ship a product. This has turned at least some people off to the service, which (again) is unfortunate. Of course, these kinds of platforms are only a few years old, and of course they're going to go through growing pains. I hope that as they continue to grow and find success that at least there's some greater recognition and public admission of the potential risks involved, so that they don't take people by surprise, and that people understand that as much as they love an idea, execution is the truly hard part. Investing in the idea is great, but there's a risk involved that the end result won't match the snazzy video that the team put together for Kickstarter in the first place. 7 Comments | Leave a Comment..
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The Inevitable Crowdfunding Backlash When People Realize Projects Fail & Change | Techdirt
furst, Aug 29th, 2012 @ 3:46am
insightful funny report

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Anonymous Coward, Aug 29th, 2012 @ 3:49am

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"Of course, these kinds of platforms are only a few years old, and of course they're going to go through growing pains." What you don't seem to understand that it isn't just growing pains, it's reality setting in. It's the point where people who are less than honest come in, and start shearing the sheep. Most of it for the moment is unintentional, but it is almost inevitable that, over time, the scam rate goes up until the concept is almost unusable. Worse yet, as you showed last week, the federal government could start to get involved and look into the way these things are financed. It's like most things in the "free internet" universe. They sound good on paper, they work great when it's the idealists using it, but as soon as the general public catches on to them, they get infested with scammers and problems and the game is pretty much over. Things like this are why I don't agree with on many "new business models" that you bring up, because you don't seem to be able to see the weaknesses and risks in them.
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haven'tforgotus.Theyjustwanttoattackus withoutevenbotheringtoadapt. Agoodlegislativechangewouldn'tforceharsh unreasonableandunprovableattacksonit's citizenswhoinfringedifitwantstodothat,in myeyes,itMUSTcreateprovisionsthatforce thecountrytoadapttothedigitalagetoo Correction:Who/might/haveinfringed.Guitly untilproveninnocentandallthatjazz rosspruden:Ihavetosay,I'mfindingmyselffar morelikelytocommentonTDthaneverbefore simplybecauseIknowmycommentshavea greaterchanceofbeinglistenedto/debated with.Thechatwindowwasakilleroption. MikeMasnick:Cool,Ross.Gladyoulikeit...We weren'tsurehowthechatwouldturnout,butso farit'sbeenfun.

Zakida Paul (profile), Aug 29th, 2012 @ 3:53am "Things like this are why I don't agree with on many "new business models" that you bring up, because you don't seem to be able to see the weaknesses and risks in them." What about the weaknesses in the current business models that our AC trolls are incapable of seeing? Here's a revolutionary business fact for you there is no such thing as a business model free of weaknesses and risk. All one can do is minimise that risk.
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Zakida Paul (profile), Aug 29th, 2012 @ 3:54am I should have added that it is going to take time for people to realise the best way to minimise that risk but it is no excuse for ignoring new business models because coming up with new ways of doing business is what innovation is all about.
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5. Re: Perfect Josef Anvil (profile), Aug 29th, 2012 @ 4:23am

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"What you don't seem to understand that it isn't just growing pains, it's reality setting in. It's the point where people who are less than honest come in, and start shearing the sheep. Most of it for the moment is unintentional, but it is almost inevitable that, over time, the scam rate goes up until the concept is almost unusable." I think you just described the gatekeeper business model perfectly.
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PaulT (profile), Aug 29th, 2012 @ 4:26am "What you don't seem to understand that it isn't just growing pains, it's reality setting in." ...and you're basing this on what, except for your own personal opinion, which we've already seen is based on fiction to begin with? "It's the point where people who are less than honest come in, and start shearing the sheep" a.k.a. what's happening in every business model, and is inevitable with anything popular. Why do you lie and pretend this is restricted to this model? "It's like most things in the "free internet" universe." What the hell does this have to do with "free", other than it allows people to bypass the corporations? "Things like this are why I don't agree with on many "new business models" that you bring up, because you don't seem to be able to see the weaknesses and risks in them.|" Why don't you discuss these then, instead of lying and namecalling? If you're such a prophet, maybe you could at least mention these things instead of trying to distort facts.
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The Inevitable Crowdfunding Backlash When People Realize Projects Fail & Change | Techdirt
insightful funny report

Anonymous Coward, Aug 29th, 2012 @ 4:27am "It's like most things in the "free internet" universe. They sound good on paper, they work great when it's the idealists using it, but as soon as the general public catches on to them, they get infested with scammers and problems and the game is pretty much over." Uh...doesn't that happen in pretty much every branch of human existence? Build something successful and scammers will try to dupe people and game the system. Has been happening forever. It's not new and not specific of new business models. "Things like this are why I don't agree with on many "new business models" that you bring up, because you don't seem to be able to see the weaknesses and risks in them." Every business model has risks. If we listened to people like you and took no risks, we'd still be stuck in caves and being eaten by pretty much every animal out there. Because, you know, trying to fashion axes out of rocks and twigs brings risks, like cutting yourself. And they could be used to attack other humans. Too risky. Better just sit here and wait to be eaten by a giraffe.
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