Is Kickstarter selling dreams?

> Has Kickstarter invented a new form of online commerce, where merchants who are close to you on the social graph, rather than in terms of physical geography, can thereby charge a premium for products which would never fly in the open market?

I think this is by far the most interesting sentence in the entire article. Traditionally we think of the web as a globalizing force, which will tend to strengthen big business: I might choose a mom-n-pop bookstore over Barnes and Noble if it's nearby and I'm buying in person. But online it will be at a severe disadvantage, and I'm not likely to find it at all unless I set out for it specifically. It's interesting to think that there may be an online equivalent of this physical proximity effect in the social graph. This possibility seems to open up lots of interesting avenues for discussion.

TL;DR version: OpEd on Kickstarter, and more specifically on Ouya.

Answer to the headline, in spite of Betteridge's law, is 'yes they are.' More along the lines of why would you invest your money in a Kickstarter project? And the answer is that what you imagine it will be like greatly exceeeds what it actually will be like.

I pointed this out to in another conversation that making a good pitch is a lot simpler than making a good product (We were discussing the difference between hype and reality, our examples were the RasberryPi and the Ouya). And people buy into the pitch, sometimes overwhelmingly so, and when it comes up short they often blame the pitchman not themselves.

I experienced a bit of this first hand when putting together 'hobby' robotics projects with folks. There is no amount of disclaimer that can break the spell.

It reminded me of a t-shirt I saw which was an expression "Makers != Engineers" and I thought it a bit snarky at the time but realized there is a grain of truth there. Anyone can have an idea, but not all of them can execute on it.

Lots of people have ideas. Lots of people even have good ideas. But few people have the necessary mix of talent, drive, and experience to turn ideas into reality.

I haven't spent much time on Kickstarter, but my impression is that a lot of people are being handed money for ideas before they discover out how hard it is to turn those ideas into a tangible quality product.

The first time I ever visited Kickstarter was almost a year ago today. I don't remember how but I became interested in a neat little device called the Klinggon (http://www.kickstarter.com/projects/klinggon/klinggon-the-ma...). I thought about putting money down but decided that I would just wait for a public launch and try one in a store.

And wouldn't you know it, all that remains of the project is a website "under contruction" and no estimates of delivery for the product. Dodged a (cheap) bullet there.

Lots of talk about spending $100 on a dream; but the median (and mode) investment on kickstarter is between $10 and $25.

Strangely, there are over half as many investors between $25 and $50, which means they account for more of the invested dollars.

Again, there are over half as many investors between $50 and $100 as 25-50.

Which means, the whales are where the money is at.

"If some as-yet nonexistent magazine had sent me a piece of direct mail, asking $15 for its launch issue, I would never have paid that. Even if an existing magazine looked really good on the newsstand, and had a cover price of $15, I would similarly never pay that. But somehow the idea that by paying the $15 up front I was helping to create that magazine — that was enough to get me to pay. ... I think that’s the real key here: I’m not paying for the sensation of a hypothetical idea, so much as paying to support the individuals whom I like and admire. "

"Even if an existing magazine looked really good on the newsstand"

Ok all of the above is true. But if you passed the newsstand and saw the ten people in front of you all buying an issue, or, when you see a line at a restaurant you take notice and think something is special that is going on. Or if you walk into the office and see your friends bought the magazine what happens then?

To me, that is what is happening with kickstarter (among other things of course obviously). There is a lemming effect same reason people will follow people who park their cars on the lawn at an event (even if the sign says "no parking") or ignore a persons plea (famous NYC case years ago) if others aren't doing something.

That to me is the behavior that is going on with kickstarter. You see others are contributing. You wonder if they know something you don't. You decide to take advantage.

Edit: "You wonder if they know something you don't." I probably didn't state this as well as I could. In the shortness of time let's look at it this way. You see a pebble watch raises a million dollars on kickstarter. That definitely creates a halo in your mind to strongly doing the same. Now you might say "chicken and egg" to that but the fact is observation of what others are doing who are like minded generally sways people in a certain direction.

In one way kickstarter is a modern form of the penny shares market. It is also a easy way to ask for small bits of alot of people instead of large bits of a few people. You also in many cases garantee the outlay needed to do a min run of your product on outsourced production lines. In a way, helping you to kickstart your company and in that it's a great name and approach. Is it selling dreams, how do you define a dream. Is it buying a ticket to see your favorite team play or paying the same amount or less to get a product/service at a great price of something that appeals to you. Both are supporting somebody else and in return you get entertainment and the rest is a bonus. So maybe your buying a lottery ticket in many ways, but the odd's are way better. As long as there is protection from scamming thru fake projects and the like then all is well. All pretty clear and good allround.

  Think of it as a geeks shopping channel.

"When faced with the reality of these products, disappointment is inevitable.."

I had backed six projects, one with near $1000 and I'm really happy of what I got, actual things. Maybe it is just me but I see ks as the extension of the real world.

In the real world there are people that you can't trust, but there is also people that you can, and most important that you SHOULD TRUST if you want to enjoy life.

We will always have the cynics and critics that enjoy trashing any new effort and from the convenience of their sofa, and that even get a life from that, but , it is not the critic who counts, the world is made by the people brave enough to risk and fail.

Have there been any notable scams on Kickstarter yet? I'm curious what sort of impact a massive scandal through these crowd funding sites would have on future donations

People should be aware that even though they say they can give you a watch or whatever half a year from now for $99, that doesn't mean that they will or that it will be as good as you think it will be.

But yes, Kickstarter is selling dreams. It's helping start-ups take off simply by believing in their vision.

Is there an "inverted" kickstarter anywhere? Basically putting out a request for Widget and companies/individuals present offers to provide Widget. Close the loop with a kickstarter-type order/financing aggregation and you get purely demand-driven products.

What did you think it was selling?

Internet Scam Alert: Most "Kickstarter" Projects Just Useless Crap http://www.youtube.com/watch?v=qqZ65pUQxyQ

By the onion