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Well, that's the grey area, isn't it? It's one thing if I invest in something and it fails. It's another thing if someone pretends to take your money as an inve

Well, that's the grey area, isn't it? It's one thing if I invest in something and it fails. It's another thing if someone pretends to take your money as an investment and instead goes to Vegas and blows it. In other words, the difference between merely a bad investment and fraud. Kickstarter can't afford to conflate the two, or people will stop investing. So they're in a tricky spot, trying to ensure that users understand that they aren't customers and that the startups can fail, while also ensuring that customers have faith that the vast majority of startups will succeed.

marshray 14y ago
The vast majority of startups fail. It used to be said that the majority of software projects run by big stable corporations would fail, i.e., be cancelled before delivery for cost and time overruns. I don't know what Kickstarter is really trying to be exactly, but it would be probably be the wrong thing to "ensure customers have faith that the vast majority of startups will succeed".
- fusiongyro 14y ago
  That would be the eBay solution, right? Make life hard on the vendor and easy on the consumer. Unfortunately, eBay is very successful despite the imbalance. Kickstarter has survived without really picking sides on this issue, but they're ultimately going to have to define their position a little more firmly and make sure both sides are getting the same message, loud and clear. If they make launching a kickstarter twice as onerous, they need to be sure they can lose half their projects. If they aim to make investments succeed less than 50% of the time, they need to be sure they can lose half their users. If they don't take a firm position one way or the other, they'll just come across as unreliable. The annoying thing about educating your users is you're never done.
Silhouette 14y ago
Isn't the problem with that whole argument that, in reality, the vast majority of startups do not succeed? I'm glad that Kickstarter is trying an alternative business model, but I do worry for their long term viability/growth prospects. People reading HN probably understand concepts like investment and lack of guaranteed rewards. People who sign up to a $1,000,000 project for what looks like a really cool game that their friends showed them, and who then get told they weren't really buying anything but a possibility, might not. And in the long run, whether or not those people should have understood their role, they are the only ones who get a say in whether they open their wallets again in the future to support someone else's project.
- sliverstorm 14y ago
  Just because startups as businesses generally fail, doesn't mean projects (which is more what Kickstarter launches) must generally fail. The metrics are totally different. While a startup needs traction, growth, and all those other difficult things, a project faces much more concrete objectives. Honestly, if the creator is realistic with expectations, goals, and required funding, it seems to me most every project on Kickstarter ought to be able to complete and thereby succeed. Not many are truly speculative "This could turn out to be impossible" sort of affairs.
  - chc 14y ago
    True, but a lot are "This could turn out to be far more difficult and expensive than we anticipated" sorts of affairs.
    - sliverstorm 14y ago
      Yes, but this can be addressed with better budgeting, and possibly an exploratory phase or doing a huge project in steps made of small projects. The point being it isn't inherent to the nature of Kickstarter projects, that only a few succeed.
      - veemjeem 14y ago
        You make it sound so simple! If all projects were addressed with better budgeting and done in steps made of smaller projects, software projects would never miss a deadline. You should email Fred Brooks about how you just discovered the solution to his Mythical Man Month, maybe you'll even win a Turing award for your insight. </sarcasm>
        sliverstorm 14y ago
        You don't have to hit every deadline on the nose for a successful project. Nor am I saying every project can succeed. We're getting off track here; the point is, I just think that success rates on Kickstarter projects are not inherently related to the success rates of startups.

marshray 14y ago

The vast majority of startups fail. It used to be said that the majority of software projects run by big stable corporations would fail, i.e., be cancelled before delivery for cost and time overruns. I don't know what Kickstarter is really trying to be exactly, but it would be probably be the wrong thing to "ensure customers have faith that the vast majority of startups will succeed".

fusiongyro 14y ago
That would be the eBay solution, right? Make life hard on the vendor and easy on the consumer. Unfortunately, eBay is very successful despite the imbalance. Kickstarter has survived without really picking sides on this issue, but they're ultimately going to have to define their position a little more firmly and make sure both sides are getting the same message, loud and clear. If they make launching a kickstarter twice as onerous, they need to be sure they can lose half their projects. If they aim to make investments succeed less than 50% of the time, they need to be sure they can lose half their users. If they don't take a firm position one way or the other, they'll just come across as unreliable. The annoying thing about educating your users is you're never done.

Silhouette 14y ago

Isn't the problem with that whole argument that, in reality, the vast majority of startups do not succeed? I'm glad that Kickstarter is trying an alternative business model, but I do worry for their long term viability/growth prospects. People reading HN probably understand concepts like investment and lack of guaranteed rewards. People who sign up to a $1,000,000 project for what looks like a really cool game that their friends showed them, and who then get told they weren't really buying anything but a possibility, might not. And in the long run, whether or not those people should have understood their role, they are the only ones who get a say in whether they open their wallets again in the future to support someone else's project.

sliverstorm 14y ago
Just because startups as businesses generally fail, doesn't mean projects (which is more what Kickstarter launches) must generally fail. The metrics are totally different. While a startup needs traction, growth, and all those other difficult things, a project faces much more concrete objectives. Honestly, if the creator is realistic with expectations, goals, and required funding, it seems to me most every project on Kickstarter ought to be able to complete and thereby succeed. Not many are truly speculative "This could turn out to be impossible" sort of affairs.
- chc 14y ago
  True, but a lot are "This could turn out to be far more difficult and expensive than we anticipated" sorts of affairs.
  - sliverstorm 14y ago
    Yes, but this can be addressed with better budgeting, and possibly an exploratory phase or doing a huge project in steps made of small projects. The point being it isn't inherent to the nature of Kickstarter projects, that only a few succeed.
    - veemjeem 14y ago
      You make it sound so simple! If all projects were addressed with better budgeting and done in steps made of smaller projects, software projects would never miss a deadline. You should email Fred Brooks about how you just discovered the solution to his Mythical Man Month, maybe you'll even win a Turing award for your insight. </sarcasm>
      - sliverstorm 14y ago
        You don't have to hit every deadline on the nose for a successful project. Nor am I saying every project can succeed. We're getting off track here; the point is, I just think that success rates on Kickstarter projects are not inherently related to the success rates of startups.