Like everyone else, I have been amazed by how Kickstarter has been able to fund business, arts, and journalism projects. But I don’t give money to Kickstarter projects. Yes, new projects are cool, but what I’m looking for is return on investment.
On Kickstarter, unless you are funding a cool new tech product that will later retail for a higher price (so the creators’ claim), you will only be rewarded with a measly little cupcake (metaphorically). Do I really want a $5 cupcake mailed to me at some random point next year? No, I don’t. Other people who are mindful of their money don’t care for such gimmicks either.
I am interested in using crowdfunding for other media purposes. However, I want funders to have equity stakes in the projects they fund (which is possibly in Germany as evidenced by my friend Lars’ project…check out the 2000 Euro+ levels here).
As crowdfunding sites proliferate, the costs of building and developing them will go down rapidly, which is demonstrated by the fact that you can now find cloned Kickstarter source code free on the Internet or pay some guys — probably in India — less than $1,000 to build, modify, and maintain a clone site for you.
What stands in the way of equity investments in crowdsourced products? The US government’s accredited investor law. More on that soon…