Thursday, December 13, 2012

Kickstarter: Know the risks

Whenever I read articles about Kickstarter projects and their misgivings, I feel confused at the uproar from investors. People who felt they were lied to, who thought that the product will come out as initially scheduled, who cries foul when no updates have been posted since the funding ended. What part of "investing" eludes them? Isn't is assumed that the production of goods isn't largely based solely on the fact that they fronted the project with their own money?

Clearly, people forget that Kickstarter is an investment site, not a pre-order site. The rules for companies with official release-date products can't apply to Kickstarter projects with an estimated date of delivery. You're only setting up for disappointment if you think like that.

Rather than detailing all the gripes people have with Kickstarter projects, I'm just going to list some things to be cognizant of when funding these projects.

  • You're investing in an idea, not buying a product - The sooner you know that you're funding someone else to pursue their ideas into fruition, the sooner you save yourself from getting let down when they bear bad news. It's a risk that comes with every project you fund, unlike setting a pre-order for a product that you know will eventually be delivered.

  • Don't wait up - There's a very likely chance that a Kickstarter project will exceed their projected deadline, which is just that - "projected." NEVER expect the project to be done on time. Complications are bound to occur in even the most optimal projects, and these contribute (more times than naught) negatively to the final release date. Again, as long as you set your expectations low, you won't suffer from extreme disappointment. But that's not to say you shouldn't express your concern, so...

  • Politely inquire - As easy it is to just troll or post some angry message to the comments section, a polite response will get acknowledged faster. Sure, people are open to express their feelings, and for some it makes them feel better. But know that not all silence is ignorance - people could truly be busy...which leads me to one tip for Kickstarter project owners...

  • Update, update, update - As an owner, you just completed funding for your project, and have a lot of people with their eyes on you. Whether you like it or not, you're now center stage, and people are at the edge of their seats waiting to be impressed. Of course, you don't have to provide daily updates, but some meaty ones within reasonable time intervals will keep people interested, while at the same time making yourself more liked because you listen to your followers. And finally...

  • Research - Once you acknowledge that funding a Kickstarter project is a investment risk, you'd naturally research what you want to invest in. Apart from what may be provided already (like websites or email addresses), it doesn't hurt to go to the forums and do some investigating on your own. Unless you personally know who's behind a project, you don't know if you're going to end up funding a scam or a legit idea, so it's best to find out as much as you can about where your funds are going to. The general safe case is if it's a company with a good past track record, your chances of getting a final product increases. Again, nothing is guaranteed, even if the creator is a well-known one.

Sure, most of these tips try to spin Kickstarter in a positive light, which is precisely the attitude one must have if people actually fund these projects. There is always the option to never fund these projects, or, as any naysayer would suggest, just avoid them like the plague. But for those that do invest, there was something they saw, that they believed in...enough to support them financially to see it through to the end.
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