It basically is, or at least a market -- a place where buyers and sellers meet and form contracts and where the sellers get the money from the buyers in exchange for the promise of some specified future delivery.
Sure, some sellers would like to have store-like inducements to the buyers to hand over money, but not store-like obligations to provide the offered goods to the buyers.
> Why is it a shock that Kickstarter projects fail?
Its not a shock when projects fail. Its a breach of contract when people accept money in exchange for a promise of future goods and then fail to deliver the future goods.
Sellers shouldn't be shocked that projects should fail -- and so shouldn't offer rewards that depend on success to be deliverable.
"Sellers shouldn't be shocked that projects should fail -- and so shouldn't offer rewards that depend on success to be deliverable."
This is actually an excellent point, but...
The reasoning behind this "pre-sale" approach is about the perceived value of the reward. An traditional gift might be acceptable (T-Shirts, etc) but there is something unique about being offered something that's not on the market yet. It makes the customer feel special, something they might be able to brag about if the product is a success.
Something akin to the concept of "Collector Edition" in the game industry.
That will add value to a reward, will attract more customer an in turn increase the chances of a successful campaign (even though successful campaign does not mean successful product).
It is a good way to kickstart a business.
Riskier? Yes.
Short sighted? Yes and no (Actually no).
Short term cost is 0 (great), long term cost is your manufacturing cost + distribution cost (ouch).
That doesn't seem right?
Actually it is.
You're actually paying for:
+ User acquisition
+ Early product validation (Lean Startup)
+ Momentum
+ Beta testing for the whole product pipeline and the product itself
I think that as a company it is definitively worth the risk.
You have to be able to take risks sometimes in order to be successful.
Your view is certainly not the same as the way many people view Kickstarter.
But let's not quibble over what Kickstarter is. There is obviously a lot of value in having some kind of market where people hand over money with the risk of project failure, in order to potentially get a new product that they want to exist built.
How would you create such a marketplace and communicate clearly that that's what it is? I ask because I thought Kickstarter was exactly this, but apparently you don't agree, so I wonder where our difference of opinion stems from..
> Your view is certainly not the same as the way many people view Kickstarter.
My view is based on things like Kickstarter's terms of service and contract law.
And the complaints about failed delivery of rewards indicate that it is also consistent with the way many backers see Kickstarter.
Certainly, I can see why each individual project team would like the idea of getting funding without giving up either equity or an obligation to pay money later (as they would in traditional financing) or an obligation to provide product (as they would in a preorder, or in Kickstarters existing terms if they offer the product as a reward), while still using the product as an inducement.
> There is obviously a lot of value in having some kind of market where people hand over money with the risk of project failure, in order to potentially get a new product that they want to exist built.
And Kickstarter can be that without product-as-reward -- after all, if the project is for a product to be offered to the public, people who back the project can "potentially get" the product (contingent on project success) when it is offered to the public.
It basically is, or at least a market -- a place where buyers and sellers meet and form contracts and where the sellers get the money from the buyers in exchange for the promise of some specified future delivery.
Sure, some sellers would like to have store-like inducements to the buyers to hand over money, but not store-like obligations to provide the offered goods to the buyers.
> Why is it a shock that Kickstarter projects fail?
Its not a shock when projects fail. Its a breach of contract when people accept money in exchange for a promise of future goods and then fail to deliver the future goods.
Sellers shouldn't be shocked that projects should fail -- and so shouldn't offer rewards that depend on success to be deliverable.