Speaker 1: Brought to you by the reinvented two thousand twelve Camray.
Speaker 1: It's ready. Are you get in touch with technology? With
Speaker 1: tech Stuff from how stuff works dot com. Hello everybody,
Speaker 1: and welcome to tech Stuff. My name is Chris Poulett,
Speaker 1: and I'm an editor at how stuff works dot com.
Speaker 1: Sitting across from me, as always, his senior writer, Jonathan
Speaker 1: Stricklind he thereoo do you do? Indeed, let's kick off
Speaker 1: this podcast by talking about projects. Yeah, let's start things.
Speaker 1: We're gonna talk about Kickstarter today, and Kickstarter is UH
Speaker 1: in case you are not familiar, it's a way to
Speaker 1: crowdsource funding a creative project. So in a way, Kickstarter
Speaker 1: is not you could argue Kickstarter in itself is not
Speaker 1: a tech stuff topic, but it is UH funded through
Speaker 1: a website. So there's your tech stuff there. A lot
Speaker 1: of tech projects have been funded through Kickstarter, so there's
Speaker 1: another connection. And there's some interesting projects that were UH
Speaker 1: in various stages as of the recording of this podcast,
Speaker 1: and I should get that out of the way first.
Speaker 1: We're recording this show on Friday July. That's important because
Speaker 1: some of the stuff we're gonna talk about is related
Speaker 1: specifically to information that's available today. So by the time
Speaker 1: you hear this, that information is going to be out
Speaker 1: of date. But we wanted to let you kind of
Speaker 1: have a snapshot of what's going on right now. Yeah,
Speaker 1: it's funny. We were recording these on July thirteen, I
Speaker 1: mean Friday the thirteenth, and we haven't but get Yeah, okay, no,
Speaker 1: I'm kidding. Um. Yeah, Jonathan wanted to talk about a
Speaker 1: couple of projects on Kickstart, and I said, you know,
Speaker 1: I'm not sure everyone understands what it is. Um, it
Speaker 1: is the kind of of I guess it's safe to
Speaker 1: call it a company organization anyway that that really wouldn't
Speaker 1: exist in its form without the Internet. Um. Yeah, the
Speaker 1: Internet enables Kickstarter and and kickstar or enables other organizations
Speaker 1: to do their thing. Um. Kickstarter does make some money
Speaker 1: off of these projects. Yea, so um basically what they do. Uh.
Speaker 1: In the nutshell sense, somebody says I have this idea,
Speaker 1: I need to raise money for this idea. I would
Speaker 1: like to post this on your website and publicize this
Speaker 1: idea to raise money. And Kickstarter says okay, and they
Speaker 1: like your idea, We'll post it on our website, and
Speaker 1: they provide all the necessary pieces for you to be
Speaker 1: able to do that. So let's say, let's let's just
Speaker 1: go ahead and make an example. Okay, okay, And I'm
Speaker 1: going to make an example that's going to be uh
Speaker 1: just generic. Okay, all right, So let's say that. Let's
Speaker 1: say that Chris, you, Let's say you have got a
Speaker 1: new band together and you want to you want to
Speaker 1: do an album together. You guys have you guys have
Speaker 1: played together for a while. You've got a unique sound,
Speaker 1: You've got something you want to say. But you don't
Speaker 1: want to go through the the traditional route of trying
Speaker 1: to get a record label to sign you on that
Speaker 1: kind of stuff. You want to do it yourselves. But
Speaker 1: that cost money. It's gonna require studio space, You're gonna
Speaker 1: have some production costs. You're gonna have if you want
Speaker 1: to if you want to press a physical medium like
Speaker 1: a CD or a vinyl disc, that's gonna cost money.
Speaker 1: So you need to be able to fund this, right yep.
Speaker 1: And without a without a record label to fund that,
Speaker 1: that's all going to come out of my pocket or
Speaker 1: go on my credit card. And you may not have
Speaker 1: the available credit or money to do this, so what
Speaker 1: you would do accurate. Let's say, so then you go
Speaker 1: to Kickstarter and you say, all right, here's what my
Speaker 1: project is. And you have to have very specific parameters
Speaker 1: for your project for you to be able to get
Speaker 1: an approved Kickstarter campaign. So I would need to say
Speaker 1: something like I want to press five thousand copies of
Speaker 1: my desk, or even you could even go so far
Speaker 1: as to say I want to record an album. You
Speaker 1: can say it that way and not even have the
Speaker 1: the required amount of like how many disks you plan
Speaker 1: on pressing? If you if you're all to specify this
Speaker 1: money will go toward the production of an album, the
Speaker 1: album is by this band, and and you're able to
Speaker 1: give enough information you submit that the Kickstarter. You say,
Speaker 1: I I estimate that I am going to need and
Speaker 1: I'm just throwing out the number ten thousand dollars. I'm
Speaker 1: gonna need ten thousand dollars. I want to have two
Speaker 1: months to raise ten thousand dollars through Kickstarter. Kickstarter gets
Speaker 1: your request, they review it if it meets the requirements
Speaker 1: that Kickstarter has put into place, uh, which we'll get
Speaker 1: into a discussion about that in a little bit. But
Speaker 1: let's say if it meets those requirements. Kicks are then
Speaker 1: will approve your campaign. They feature it on their site
Speaker 1: somewhere so it's searchable. Sometimes they'll actually feature feature it
Speaker 1: so it's right there on the front page and you
Speaker 1: can see it right there if you're lucky enough, that's
Speaker 1: where it is, which means a lot of eyeballs are
Speaker 1: going there. But generally you'll promote this through other means
Speaker 1: like social media, Facebook, Twitter, that kind of thing. UM.
Speaker 1: Then what happens is people can go and they can
Speaker 1: contribute money toward that project. They're not donating their contributing,
Speaker 1: they are investing in that project. It's very important part
Speaker 1: of this. So when they invest, they're using an Amazon
Speaker 1: payment method to transfer money to this or to pledge
Speaker 1: money really to this project. And it's not unless the
Speaker 1: project actually meets its goal, that that money gets pulled
Speaker 1: from the contributors. Right, So, if you say, say somebody
Speaker 1: is asking for ten thousand dollars from fans for example,
Speaker 1: like like this record that we are talking about UM,
Speaker 1: and people contribute say five dollars each, and they only
Speaker 1: raise eight thousand, five dollars over the two month period,
Speaker 1: it doesn't go then you're not out five dollars or
Speaker 1: whatever you keep. You keep your money. The project does
Speaker 1: not get funded, you keep your money. Kickstarter does not
Speaker 1: make anything, So it's actually in the Kickstarter's interest to
Speaker 1: make sure to do as much as it can so
Speaker 1: that these projects get funded, because that's how Kickstarter makes money.
Speaker 1: So if that ten thousand dollars did go through, let's
Speaker 1: say that you know that you you just hit that
Speaker 1: ten thousand dollar mark within the time frame, you would
Speaker 1: get ten thousand dollars minus Amazon payments cut and Kickstarters cut.
Speaker 1: They both get a cut of that. It can be
Speaker 1: up to as much as ten percent, So it might
Speaker 1: be that you only get nine thousand instead of ten
Speaker 1: thousand because of the cuts that Amazon and Kickstarter make.
Speaker 1: But and Amazon's amount is dependent upon where you are
Speaker 1: and other factors, so it can't really give a solid
Speaker 1: figure on that. But Kickstarters is five percent, so at
Speaker 1: least five percent it's gonna be taken out. Uh, So
Speaker 1: you need to take that into account when you set
Speaker 1: your goal because you're you're like, all right, well, if
Speaker 1: that's how much I really need, I'm going to get
Speaker 1: five percent less than that if I just meet this goal.
Speaker 1: Now you can make more than what your goal is
Speaker 1: and of them have. Yeah, and it's and you don't
Speaker 1: get access to that money until the period is up.
Speaker 1: So if it's a ninety day period and at the
Speaker 1: end of ninety days you have uh more than five
Speaker 1: times what you were asking for, that's when you get
Speaker 1: it all. And of course that that appeals to Kickstarter too,
Speaker 1: because they take that five percent off the total, not
Speaker 1: off what the goal was. So if your goal was
Speaker 1: ten thousand, you make fifty thousand, they get that five
Speaker 1: percent off the fifty thousand, not the ten thousand, which
Speaker 1: great business for Kickstarter. Uh So, I mean it is
Speaker 1: a business. You know. They're not completely altruistic, nor should
Speaker 1: we expect them to be, because it would cost money
Speaker 1: and resources to run this site. So I'm not I'm
Speaker 1: not trying to cast dispersions on Kickstarter for trying to
Speaker 1: make money. If they didn't, this thing wouldn't exist and
Speaker 1: a lot of people who have had projects get funded
Speaker 1: would not have had that money, right and uh, you know,
Speaker 1: of course it's it's paying the bills and it's paying
Speaker 1: for people to to work at the site, so that's important.
Speaker 1: So uh, we're talking about how they're contributors, not donators, um,
Speaker 1: the contributors. Part of that, part of that relationship is
Speaker 1: that when you contribute, you should be able to expect
Speaker 1: something in return, right, So, if you contributed to the
Speaker 1: release of my faux band's new album, you should get
Speaker 1: a copy of that record, assuming your contribution meets a
Speaker 1: certain level. You can think of it kind of like
Speaker 1: and and it's only in the sense of if you
Speaker 1: contribute a certain amount, you get a reward. You know,
Speaker 1: like when a pledge drive happens on something like NPR
Speaker 1: or PBS, where if you pledge a certain amount of
Speaker 1: money you get rewards in return. It's similar to that,
Speaker 1: except again you're not donating your contributing. So if when
Speaker 1: you create a project, if you want to create a
Speaker 1: project for Kickstarter and have a Kickstarter campaign, part of
Speaker 1: what you have to do, besides setting a time limit
Speaker 1: and a cash goal, is you have to set up
Speaker 1: rewards for contributors at different levels, and ideally those levels
Speaker 1: should relate to the reward should relate to how much
Speaker 1: money is being donated. So in other words, uh, if
Speaker 1: if you donate twenty five dollars to Chris's project, and
Speaker 1: that would get you a a special version of the
Speaker 1: CD that has maybe a track on it that the
Speaker 1: normal c D doesn't have, so you get a bonus
Speaker 1: track for twenty bucks. Let's say that you do fifty bucks. Well,
Speaker 1: you wouldn't want just to have two copies of that CD.
Speaker 1: That might not be a great reward. But perhaps it's
Speaker 1: a copy of the CD that's autographed by the entire band,
Speaker 1: and maybe some other swag like a poster or some
Speaker 1: stickers or stuff. And depending upon the complexity of the project,
Speaker 1: the size of it uh and the the ability of
Speaker 1: the the person who's running the project to deliver upon
Speaker 1: these they can get pretty elaborate. Like I've seen ones
Speaker 1: where if you contribute a very large amount of money
Speaker 1: towards a big project, you end up getting You might
Speaker 1: get a producer's credit on something like let's say that
Speaker 1: someone contributed a thousand dollars to your band's project. You
Speaker 1: might include their name in the liner notes for the
Speaker 1: the album saying this is a producer for this album,
Speaker 1: because essentially they are they're they're they're contributing a significant
Speaker 1: amount of money. Yes, that's gosh. I love them producers.
Speaker 1: I love you. Get in touch for me anyway. So
Speaker 1: the MP three, you'll have my digital signature. I can't
Speaker 1: imagine how that could go wrong. So so anyway, Yeah,
Speaker 1: that's that's the whole basic idea of Kickstarter. On the
Speaker 1: on the project leaders side, you have these returns that
Speaker 1: people get in in uh uh as a result of
Speaker 1: them contributing to you, and if you get the you
Speaker 1: don't have to worry about giving out the rewards unless
Speaker 1: the project hits completion. Now let's talk. I'm sorry you're
Speaker 1: about to say something. Well, I was gonna I was
Speaker 1: gonna say that just in the in the general outlining
Speaker 1: of of what Kickstarter is, um Jonathan mentioned that it's
Speaker 1: for creative projects, and yes, that's that's pretty much exclusive,
Speaker 1: semi exclusively what it is. I mean, going alphabetically on
Speaker 1: the website, you see art, comics, dance, design, fashion, film
Speaker 1: and video, food, games, music, photography, publishing, technology, and theater
Speaker 1: and tech is really sort of the standout odd uh category.
Speaker 1: I mean, most of these are most of these are
Speaker 1: intangible and in the sense that you know a film,
Speaker 1: you know it's it's you would have the film, or
Speaker 1: you would have a copy of the video, or the
Speaker 1: copy of the comic book. It's also interesting that the
Speaker 1: Tech one has the single largest funded campaign in Kickstarter
Speaker 1: history to date. Although well, no, it'll still be tech
Speaker 1: but I think that there might be a there's a
Speaker 1: contender to take over the helm on that, depending on
Speaker 1: how much more momentum it as. But we'll get into that. Yeah,
Speaker 1: you don't. You don't see the kind of stuff that
Speaker 1: you see advertised on TV, the as seen on TV
Speaker 1: type things. Uh. Technology is is the the category where
Speaker 1: you know they have come up with an idea for
Speaker 1: this invention. Yeah, it's kind of this whole like crazy
Speaker 1: prototype stuff that can that can get funded through this Um.
Speaker 1: The company was founded by Perry chen Yancy Strickler, and
Speaker 1: Charles Adler, and it's located out of Manhattan. That's in
Speaker 1: New York. There you are, Perry, There you are, Perry. Um,
Speaker 1: I'm not gonna do it. I keep on wanting to
Speaker 1: go into duven Sharts every time. Curse your Patty, that
Speaker 1: Kickstarter founder. Um. So they they've created this company. Uh,
Speaker 1: here's some some things to keep in mind with Kickstarter. Um,
Speaker 1: because this is a service that they're running, they've done
Speaker 1: some work to protect Kickstarter from problems. But there there
Speaker 1: are things you've got to keep in mind with Kickstarter,
Speaker 1: and and this is not to cast dispersions upon the
Speaker 1: service or upon anyone who uses it. Well, one of
Speaker 1: the things that you mentioned early on in this podcast
Speaker 1: was these projects have to meet a series of requirements
Speaker 1: in order to be considered. And that's part of it.
Speaker 1: These these requirements you have to be uh, you have
Speaker 1: to at least have you know, as far as they
Speaker 1: can tell. You know, there are people who have to
Speaker 1: vet these things to make sure that they're legit. And
Speaker 1: because Kickstarter doesn't want to get burned, and they also
Speaker 1: don't want to lose their credibility, and it is important,
Speaker 1: um for them to go, Hey, we've checked these guys
Speaker 1: out and they appear to us to be real enough
Speaker 1: for us to post them online. If it looks like
Speaker 1: if people got burned by enough scams on Kickstarter, no
Speaker 1: one would go there to find projects. And for Kickstarter,
Speaker 1: that's that's bad news. First of all, because people will
Speaker 1: stop using the service and go away. And second of all,
Speaker 1: I mean they really want to help people. I mean,
Speaker 1: that's the really the point, um. And without making sure
Speaker 1: that there for real um, you know, than uh, than
Speaker 1: Kickstarter fails. Yeah, yeah, and so, but that is one
Speaker 1: thing you've got to worry about, is the fact that
Speaker 1: with yourself in their shoes. Yeah, with with a Kickstarter campaign,
Speaker 1: if you're looking at funding one, keep in mind that
Speaker 1: there's nothing that legally binds that project leader to use
Speaker 1: the money for what they say it's going to be
Speaker 1: used for. So if it's like, hey, this sounds like
Speaker 1: a really cool project, I want to be a part
Speaker 1: of it, and you put money towards it, there's a
Speaker 1: chance that even if it gets funded, that project never
Speaker 1: actually happens. And that could be for multiple reasons. It
Speaker 1: might be that the person swindled you, which is awful,
Speaker 1: it's a terrible thing. Hopefully that doesn't happen because, as
Speaker 1: you said, Chris, if it happens frequently enough, no one
Speaker 1: uses Kickstarter and then we lose this this service, which
Speaker 1: I think is very valuable. Uh. Or it could be
Speaker 1: of much simpler and more innocent but naive problem in
Speaker 1: that the person who was the spirit that this was
Speaker 1: spearheading this project underestimated how much money it was going
Speaker 1: to take in order to make the project become a reality.
Speaker 1: So it may be that they say, oh, oh, I
Speaker 1: could do this for ten thousan dollars and they get
Speaker 1: the ten thousand dollars and they find out as they
Speaker 1: work that it's way harder than they expected, and the
Speaker 1: ten dollars runs out and the projects not complete. Yeah,
Speaker 1: they they use the money, they start working on a prototype.
Speaker 1: The prototype doesn't work exactly the way they thought it would.
Speaker 1: It's gonna need some re engineering. They're going to have
Speaker 1: to build a new prototype. And meanwhile they're burning through
Speaker 1: the money. Yeah, and they take it to somebody, and
Speaker 1: it's going to cost more than they thought it was
Speaker 1: going to to manufacture. So you get to a point
Speaker 1: where you're just like, well, crap. That just means that we, uh,
Speaker 1: we we've burned through. And this happens with companies, whether
Speaker 1: they're crowdsourced or not. So so this is not unique
Speaker 1: to kick starter projects, but you know, sometimes that happens
Speaker 1: where a project ends up being I always tell people
Speaker 1: overestimate how much you're gonna need, because stuff is gonna
Speaker 1: happen that's going to eat up money that you did
Speaker 1: not expect. Well, let's let's compare it really quickly, because
Speaker 1: we want to talk about some actual projects, but really quickly,
Speaker 1: let's compare it to let's say another a regular type
Speaker 1: tech project. So somebody has an idea and they take
Speaker 1: it to a venture capitalist and the venture capitalists gives
Speaker 1: them two million dollars. So the venture capitalist is putting
Speaker 1: forth all of the money for this project to go forward.
Speaker 1: Um and uh, he or she is is basically the
Speaker 1: loan stakeholder other than the person who came up with
Speaker 1: the idea in the first place. Um, so you or
Speaker 1: I here about it. They bring it to c E
Speaker 1: s they go, you know, Jonathan talks about it in
Speaker 1: the blog and says, look this, and you go, man,
Speaker 1: that would be cool. I'm going to buy one of
Speaker 1: those when it comes out on the market. While all
Speaker 1: of this stuff happens, they find out it can't be
Speaker 1: done for that much money. The VC goes, I am
Speaker 1: not giving you anymore dough because you can't make this
Speaker 1: happen in a cost effective way. There's no sign of
Speaker 1: the burning through cash ever ending forget it. I'm done.
Speaker 1: And and because of this, the person can't get any
Speaker 1: more funding and they go back to their job working
Speaker 1: in a computer store. In Kickstarter, the people funding this
Speaker 1: project are you and me, and we've all contributed a
Speaker 1: hundred dollars each. We're like, we're like venture cabalists on
Speaker 1: a fraction of what a venture cabalists actually does. Yeah,
Speaker 1: and so we've donated money and we are contributed money. Yes,
Speaker 1: I'm sorry, I'm sorry, I'm in my head. So we
Speaker 1: are are contributing our share of the money. There are
Speaker 1: a few hundred of us or a few thousand of
Speaker 1: us who all want to make this project succeed instead
Speaker 1: of just one person and the enture capital donating it all.
Speaker 1: So none of this is behind the scenes. It's all
Speaker 1: out here on kickstarted out on the table, and we
Speaker 1: all are waiting for our thing. That we have contributed
Speaker 1: money towards rewards, because that's because it happened. There's no
Speaker 1: there's no guarantee that the rewards that are promised are
Speaker 1: going to come out either. So it may even be
Speaker 1: that the project gets funded and it happens, but that
Speaker 1: the person who was leading the project flakes out and
Speaker 1: never sends out whatever the rewards were supposed to be.
Speaker 1: That's also danger. So one of the things you should
Speaker 1: look at is when you're funding one of these projects
Speaker 1: of thinking all right, am i am I? All right?
Speaker 1: With the notion that if I contribute to this project,
Speaker 1: there is a chance, depending upon the reliability of the
Speaker 1: people in charge of this project, that I will not
Speaker 1: get the reward promised me. If that means that the
Speaker 1: project still funds and the thing still becomes a real thing,
Speaker 1: because sometimes that might be all that's important to you.
Speaker 1: You might not. You might say, oh, the reward is nice,
Speaker 1: and that's cool and all, but I really just want
Speaker 1: to see this thing become a real thing. So if
Speaker 1: you're all right with that, then you might not. That
Speaker 1: might not worry you at all. But if you're if
Speaker 1: you're more like, look, I am contributing, and at the
Speaker 1: level that I'm contributing, I'm expecting to get this thing.
Speaker 1: That's another thing to keep in mind. You know, it's
Speaker 1: also helpful to talk to people who have funded various
Speaker 1: Kickstarter campaigns and just talk about their experience about you know,
Speaker 1: did you did you actually get the rewards you were promised,
Speaker 1: was it timely? What what should I expect? And keep
Speaker 1: in mind their experience may not at all apply to yours,
Speaker 1: because these are all different people who are applying for
Speaker 1: these campaigns, so you never you know one person's experience
Speaker 1: with one project is totally different from any other project
Speaker 1: that's out there. That being said, I was going to
Speaker 1: talk about the other problem that can happen, and this
Speaker 1: relates to one of the stories that wanted to talk about.
Speaker 1: If that's okay, let's let's do that. A specific story
Speaker 1: is as the recording this podcast. A big story in
Speaker 1: tech is this uh yeah, gaming console. And the gaming
Speaker 1: console is the concept. It's going to be a nine
Speaker 1: dollar gaming console running on essentially an ARM based processor
Speaker 1: uh Android operating system derivative. The idea being that it
Speaker 1: could run various games that were originally designed for mobile platforms,
Speaker 1: but to do it on a television, and it could
Speaker 1: also emulate or run an emulator to run other types
Speaker 1: of games as well. And beyond that, the game model
Speaker 1: is the ideas that you would you would download games
Speaker 1: or stream games, so you are not buying lots of
Speaker 1: physical media, You are buying stuff through the internet, and
Speaker 1: you would be able to play a lot of these games,
Speaker 1: at least on a trial basis for free, so you
Speaker 1: wouldn't just be buying stuff blind. You get a chance
Speaker 1: to play this. Uh. This resembles all other game systems
Speaker 1: that are have similar business models, like on Live. It's
Speaker 1: not a whole lot different from that, although in this
Speaker 1: case it's not a subscription based service. You're buying a
Speaker 1: console and then you're buying into the dual games. Uh.
Speaker 1: They launched a Kickstarter campaign in July with a goal
Speaker 1: of nine hundred fifty thousand dollars. I think after the
Speaker 1: second day they had more than two million dollars. As
Speaker 1: of the recording of this podcast, it is currently funded
Speaker 1: at four million, nine thousand, two d seventy eight dollars
Speaker 1: with twenty six days left to go. More than thirty
Speaker 1: four thousand people are backing this project, so they've already
Speaker 1: more than met their goal. You know, their goal was
Speaker 1: less than a million dollars. Now they've got four million dollars,
Speaker 1: so their their their project is funded. Uh. They won't
Speaker 1: get that money until the projects over. Of course, by
Speaker 1: the time this podcast goes out, it will be a
Speaker 1: lot closer. In fact, it may already have happened. Um.
Speaker 1: But they're going to get more money than what they
Speaker 1: asked for. That might not necessarily be a great thing.
Speaker 1: And the reason why I say that is because sometimes
Speaker 1: when you get more money than what you need to do,
Speaker 1: what you need to do you you might not behave
Speaker 1: in as careful a way as you would if you
Speaker 1: had just the right amount of money. You're not thinking
Speaker 1: of all those lottery winners who blow all their money
Speaker 1: and up in bankrupt I'm thinking a lot of startup
Speaker 1: companies that got crazy amounts of venture capital balloon like
Speaker 1: the dot com crash. That was part of the problem
Speaker 1: dot com crash. One of the many problems was that
Speaker 1: you had these startup companies that were getting lots of
Speaker 1: cash injections from venture capitalist angel investors, that kind of thing,
Speaker 1: lots and lots and lots of money, more money than
Speaker 1: they needed to conduct business, and so they grew way
Speaker 1: too fast without anything to show for it. So they
Speaker 1: were doing things like buying lots of office equipment that
Speaker 1: they didn't necessarily need, hiring on people that they didn't
Speaker 1: have work for yet, you know, going like, well, you know,
Speaker 1: we were going to get a little office space at
Speaker 1: the bottom of this one building, but now that we've
Speaker 1: got all this cash, let's go for the penthouse that
Speaker 1: kind of stuff, and buying pinball machines and all kinds
Speaker 1: of other stuff. And you could, even even if you're
Speaker 1: not going extravagant, all right. Let's that's let's telling you
Speaker 1: about you really lose sight of what you're doing and
Speaker 1: you're going for extravagance. Let's say that this company avoids
Speaker 1: that they don't go for this whole extravagant route, but
Speaker 1: instead what they do is they start developing this. They
Speaker 1: might be willing to pursue a less than ideal pathway
Speaker 1: longer than they would if they had less cash, because
Speaker 1: they have cash to burn through. They have a safety net, right,
Speaker 1: so they can they can They have the luxury because
Speaker 1: of the cash, to make a bad decision longer than
Speaker 1: they would if they had less cash. So there is
Speaker 1: the potential that they can make some very very bad
Speaker 1: choices and stick with them longer than they need to.
Speaker 1: And it's not ideal. Now that I'm not saying that
Speaker 1: will definitely happen, because the people at Uyah may have
Speaker 1: a real grip on this, and they might just make
Speaker 1: not just this cool game console, but be able to
Speaker 1: incorporate stuff they didn't even think of when they first
Speaker 1: launched this campaign. He could turn out that this project
Speaker 1: ends up being a wild success. The game console could
Speaker 1: end up being the best thing ever, and and everything
Speaker 1: works out. We don't know if that's the case or not.
Speaker 1: I'm just saying that there are dangers to actually over funding.
Speaker 1: You might think more money equals good, it does not
Speaker 1: always equal good. Now that being said, that four million
Speaker 1: dollars with with a nine is not and that's still
Speaker 1: in process. That's not the biggest project that's been funded
Speaker 1: on Kickstarters so far. Before there was have you you've
Speaker 1: heard about the Pebble right, Yes to watch and e
Speaker 1: paper watch ink and it. The idea is that you
Speaker 1: would connect this watch to another device, a smartphone, like
Speaker 1: through Bluetooth, right, and it would display various things on
Speaker 1: the watch that would let you see stuff that was
Speaker 1: coming through on your phone. So it's kind of like
Speaker 1: a phone watch phone without the but it connects to
Speaker 1: an existing device. And um they, the company behind it,
Speaker 1: launched a Kickstarter campaign where they were trying to raise
Speaker 1: a certain amount of money and boy did they. Uh.
Speaker 1: I don't remember what there. I guess I could search,
Speaker 1: but I don't remember what their actual um uh goal was.
Speaker 1: Their original goals it Oh, they more than crushed it. Yeah,
Speaker 1: all right, I'm actually pulling up the site now. Okay,
Speaker 1: So their goal was one hundred thousand dollars. That was
Speaker 1: what they wanted to raise. They raised ten million, two
Speaker 1: hundred sixty six thousand, eight hut five dollars. Now that
Speaker 1: is an overfunded project. To go from one hundred thousand
Speaker 1: to ten million, I can't imagine, like, what do you
Speaker 1: do with all that money, apart from make more of
Speaker 1: these pebbles once they're ready to go and send them
Speaker 1: out to the backers. That's the only thing I can
Speaker 1: think of, because we have ten ten million dollars. So
Speaker 1: I've seen people uh already criticizing Pebble and oh, yeah,
Speaker 1: it's not really their fault. Well, I mean basically what
Speaker 1: they're saying is, hey, you may be funding these guys
Speaker 1: and they may not actually be scam artists, but it's
Speaker 1: gonna feel like a scam when nothing happens for you guys.
Speaker 1: And I mean that we're talking about people who are
Speaker 1: basically saying you've you just flushed your money and and
Speaker 1: or or without, which I feel is probably a little
Speaker 1: bit premature because everything I've seen says that both of
Speaker 1: these companies are honestly intending to do this and they're sincere. Yeah,
Speaker 1: they're being sincere. They really want to accomplish their goal.
Speaker 1: They really want to make the Pebble Watch and the
Speaker 1: and the we Are game console. But the uh, the
Speaker 1: question is um and this I don't think that was
Speaker 1: the point of the columns that I've been reading was basically, Look,
Speaker 1: they don't know what they're doing. These are not seasoned professionals. Uh.
Speaker 1: You know, this is not uh Microsoft deciding it wants
Speaker 1: to create a tablet with its name on it. Microsoft
Speaker 1: knows about manufacturing because they learned with the Xbox. Um.
Speaker 1: You know, Google has already come out with a phone,
Speaker 1: you know, essentially working with other manufacturers. They know what
Speaker 1: kinds of things that they're going to have to deal
Speaker 1: with it. They want to come out with the Nexus
Speaker 1: seven tablet because they have worked with hardware manufacturing before.
Speaker 1: These guys are new to this, and so they're gonna
Speaker 1: have to find out about all this stuff. And they're
Speaker 1: not going to end up with enough money even with
Speaker 1: these highly funded projects to do what they need to
Speaker 1: accomplish because they just they just don't know what they're doing.
Speaker 1: They're inexperienced, and you're gonna end up losing your money.
Speaker 1: To be fair, a lot of the people who are
Speaker 1: working on these projects have experience in the various industries otherwise,
Speaker 1: I mean clearly, like I would not started kick started
Speaker 1: campaign for a game console. I have no experience developing one.
Speaker 1: I've played them. Yeah, that's about the limit of my experience.
Speaker 1: I think that's why I think the these these naysayers
Speaker 1: are probably being a little unfair there. I think they're
Speaker 1: being overly pessive this stick. But at the same time,
Speaker 1: it's good to check your expectations because things can go wrong.
Speaker 1: It could it could even be that the money is fine,
Speaker 1: that the money doesn't burn out. It's just that their
Speaker 1: goal ends up being unreasonable, like they just can't. They
Speaker 1: cannot meet the goal that they had set. They're they're
Speaker 1: not not the money goal, but the project's goal. So
Speaker 1: sometimes that happens, and it's unfortunate when it does. But
Speaker 1: that's another thing that you need to keep in mind.
Speaker 1: Um whether or not these will be you know, cautionary
Speaker 1: tales in the future, that remains to be seen. I'm
Speaker 1: hoping that both of them, both the Pebble and the
Speaker 1: end up being successful avengers, because one, I think they're
Speaker 1: both cool ideas and I think it's neat to see it,
Speaker 1: and too I don't want there to be this big
Speaker 1: red X over a Kickstarter because I think that it's
Speaker 1: such a valuable service. I don't want something like that
Speaker 1: too negatively impact the service. Well, there are so many
Speaker 1: people with great ideas for projects, uh, they don't have
Speaker 1: the ability to raise the funding for them, uh necessarily
Speaker 1: on their own. And this also, I mean this not
Speaker 1: only gives them a chance to get funded, but it
Speaker 1: also gives uh, you know, the average person who doesn't
Speaker 1: have ten million dollars burning a hole in their pocket
Speaker 1: to give to somebody with a cool idea. So you
Speaker 1: have twenty dollars, you know, Hey, I've got twenty dollars
Speaker 1: I can give you to make this project a reality.
Speaker 1: I know I can't fund you by myself, but I
Speaker 1: would love to contribute to to make this happen. Um
Speaker 1: where how can I do that? This is really a
Speaker 1: great tool to make that happen. Now, there are other
Speaker 1: projects that already exist, and they're they're somewhat controversial too,
Speaker 1: because this is I mean, for for these that we've
Speaker 1: already talked about, they don't exist yet. Their their ideas uh,
Speaker 1: and they've they've maybe come up with a prototype or
Speaker 1: something that they feel like they can actually take and
Speaker 1: have it manufactured. Now, Um, the biggest one I can
Speaker 1: think of that that exists in this other world where
Speaker 1: it already is of something that they want to continue
Speaker 1: funding for would be Penny Arcade. Now, this is a
Speaker 1: really controversial subject, and in fact, our site director Tracy
Speaker 1: Wilson wrote a blog post about this on the house
Speaker 1: Stuff Works blog where she shared her perspective, which I
Speaker 1: stuff on pop stuff stuff. Yeah, it used to be
Speaker 1: called fan stuff. It's pop stuff Now. I'm stuck in
Speaker 1: the past. So am I I have to keep reminding
Speaker 1: myself whenever I talk about it, But I share her
Speaker 1: perspective more or less her philosophy on this. Uh the
Speaker 1: here's here's the pitch. So, Pitty Arcade is a well
Speaker 1: established web comic and entertainment company. Yes, they go beyond
Speaker 1: web comics now to other things, but web comic is
Speaker 1: sort of the heart and soul of what Penny Arcade is.
Speaker 1: That's how they started out. Yeah, and when they started
Speaker 1: they were funded completely by their audience. People would leave
Speaker 1: donations for penny Arcade that'll donate button, and that's how
Speaker 1: they made money. And so some months they would make
Speaker 1: a pretty good amount of money and other months would
Speaker 1: be particularly tight, and that's how they operated for a while.
Speaker 1: They eventually supplemented there that with web ads and then
Speaker 1: eventually they got to a point of popularity where the
Speaker 1: web ads were enough to support the business and they
Speaker 1: now have lots and lots of of their Their audience
Speaker 1: is huge relatively speaking for the Internet. Right it's one
Speaker 1: of the largest audiences on the Internet for for like
Speaker 1: an entertainment webcomic type of approach. Well, they decided to
Speaker 1: the Tycho and Gabe's that's their alter egos. Anyway, Tycho
Speaker 1: and Gabe decided to UH to try and operate the
Speaker 1: site going back to their roots by having a crowd sourced,
Speaker 1: crowd funded penning arcade which would allow them to get
Speaker 1: rid of their ads. So they talked about to decide
Speaker 1: how much money would they need in order to run
Speaker 1: their site add free for a year, and then came
Speaker 1: up with the figure of one million dollars. Uh. Now,
Speaker 1: their kick started campaign, if you were to go visit
Speaker 1: that is not for one million, it's for two hundred
Speaker 1: fifty thousand dollars. That's their goal, and that's their first goal.
Speaker 1: The goal if they hit two undred fifty thousand dollars.
Speaker 1: They are going to take off the leader ad that's
Speaker 1: on the main page. It goes away that space gets
Speaker 1: reclaimed to the actual site um and then if they
Speaker 1: go over that, they have stretch goals at every so
Speaker 1: often and until you hit a million, where penny Arcade
Speaker 1: ends up being ad free for a year. As of
Speaker 1: the recording of this podcast, they have thirty three days
Speaker 1: to go on their campaign and they've raised two d
Speaker 1: nine thousand, six hundred twenty eight dollars, so they haven't
Speaker 1: hit the two fifty thousand yet, but it's they've got
Speaker 1: they've got more than a month to go. Now, the
Speaker 1: controversy that's coming up here is that one paying our
Speaker 1: kide is well established. It already exists. It does not
Speaker 1: need this money in order to operate, in other words,
Speaker 1: because it already has a revenue generating model, it's got ads.
Speaker 1: It doesn't need to be kickstarted. It it is it.
Speaker 1: It's an establishment, right, it's not a it's not a startup.
Speaker 1: So that's one problem that people have. It is like, well,
Speaker 1: you're already there, Why do you need to go this way?
Speaker 1: How does it meet the requirements of kickstarterblished. That's the
Speaker 1: other one is that they feel that this is not
Speaker 1: what Kickstarter is meant for. Therefore, this is a bad
Speaker 1: idea in the sense that it takes notice away from
Speaker 1: the stuff that Kickstarter is meant for. Also, it opens
Speaker 1: up the potential door for other sites that are ad
Speaker 1: based to try and follow suit, which, in the minds
Speaker 1: of some people, dilutes the brand of Kickstarter. It it
Speaker 1: means that what Kickstarter is and what it's for gets
Speaker 1: diluted because something that was unintended pops up, becomes a success,
Speaker 1: inspires other people, and then you've got way more static,
Speaker 1: right because you're talking about you want to find the signal,
Speaker 1: you want to find the thing that you want to
Speaker 1: support within Kickstarter. This opens up the opportunity for all
Speaker 1: these other companies and organizations and individuals to approach Kickstarter
Speaker 1: in ways that it was not intended. It becomes even
Speaker 1: harder to find the stuff that you would actually want
Speaker 1: to support within Kickstarter's realm. Yeah, okay, so there's that,
Speaker 1: and then it really comes down to to the people
Speaker 1: who run Kickstarter and having them make decisions on what
Speaker 1: appears and what doesn't. Precedent will approach them, and they
Speaker 1: can't say, well, we don't do this. They'll be able
Speaker 1: to say, well you did. Why is that different? Exactly exactly. Yeah,
Speaker 1: that's a that's a dangerous thing. Is always setting presidents
Speaker 1: is always dangerous, Um, not presidents. I mean setting a
Speaker 1: president probably is dangerous too, but precedent the h So yeah,
Speaker 1: that's that's Those are the general objections to this. Not
Speaker 1: that penny Arcade wants to take ads off its site
Speaker 1: or go to a user funded model. There's no problem
Speaker 1: with that. I don't have any problem with that. I
Speaker 1: don't think anyone does. The problem is using Kickstarter as
Speaker 1: the platform when perhaps there's a different platform out there
Speaker 1: that they could pursue that doesn't compromise what the at
Speaker 1: least perceived purpose of that service is all about. So
Speaker 1: that's a problem. Um. And again, it may turn out
Speaker 1: that it sends up being a non story and that
Speaker 1: after this no one cares, but it definitely opens up
Speaker 1: some potential issues. Um, I can see why people would
Speaker 1: be upset about it. Yeah, I've got some interesting stats
Speaker 1: about Kickstarter in general. So again, as of the recording
Speaker 1: of this podcast, this is what you can find on
Speaker 1: the Kickstarter stats page about you know how many pain
Speaker 1: projects that there have been to date, Sixty three thousand,
Speaker 1: four ninety two projects were launched UH, with a success
Speaker 1: rate of just under forty percent, so more than half
Speaker 1: of these projects were not funded. UH. In fact, thirty
Speaker 1: three thousand, three hundred ten of those sixty three thousand,
Speaker 1: four ninety two did not make it. Out Of those
Speaker 1: unsuccessful projects, UH, twenty thousand, two hundred seventy two of
Speaker 1: them raised between one and twenty percent of their goals,
Speaker 1: So they just didn't get off the ground, right, They didn't.
Speaker 1: They didn't even get the The vast majority of the
Speaker 1: unsuccessful projects did not raise more than of what they wanted,
Speaker 1: So it was pretty clear for those projects well into
Speaker 1: the campaign that it just was not going to happen
Speaker 1: unless someone really opened up their wallet. The the heartbreaking
Speaker 1: stat is one seventy two unsuccessful projects got between eighty
Speaker 1: one and funded, so they were within that last twenty
Speaker 1: percent where they just needed that last little bit and
Speaker 1: they would have been funded, and they didn't make it
Speaker 1: that much. Yeah, as for the successful ones, three thousand,
Speaker 1: one forty of the successful projects were aiming at a
Speaker 1: thousand dollars or less as their their goal, but eighteen thousand,
Speaker 1: one hundred fifteen were aiming at between one thousand and
Speaker 1: nine thousand, nine ars. So most of the successful projects
Speaker 1: were looking for more than a grand, but less than
Speaker 1: ten grand UH three thousand, forty three, which is almost
Speaker 1: as much as the The people who were wanted the
Speaker 1: smallest amount went for ten thousand to twenty thousand dollars
Speaker 1: or nine if you want to be specific. So a
Speaker 1: good portion of them we're looking for around twenty between
Speaker 1: ten and twenty grand as well. So that's kind of
Speaker 1: interesting that those were the successful ones. UM that between
Speaker 1: one and and thousands seems to be the sweet spot
Speaker 1: for UH for ambitious projects, but that the ten to
Speaker 1: twenty is not outside the realm of possibility. I would
Speaker 1: I would wager that the majority of those successful projects
Speaker 1: that range between ten and twenty, I'd wager most of
Speaker 1: those are towards the ten thousand dollar mark, not the
Speaker 1: twenty UM. And we've seen, like you said, we've talked
Speaker 1: about oh yeah, and we talked about um UH the pebble,
Speaker 1: both being projects that were overfunded. That can happen. I
Speaker 1: know there's one particular Kickstarter project that several of my
Speaker 1: friends supported I've actually got friends who have had Kickstarter
Speaker 1: projects which are really cool. But there's one in particular
Speaker 1: that my friends supported that I see all over the
Speaker 1: place now, which is Cards against Humanity. I heard about
Speaker 1: this not much. Okay, have you ever heard of the
Speaker 1: game Apples to Apples? So in Apples to Apples for
Speaker 1: those of you who don't know, the way the game
Speaker 1: is played is that someone is a player, draws a
Speaker 1: card that is uh, some sort of descriptive, the word,
Speaker 1: like an adjective, like it might be um, it might
Speaker 1: be fluffy. That might be the word. And then everyone
Speaker 1: else has words in their hand on cards that say,
Speaker 1: that's a noun, some sort of noun, and they all
Speaker 1: everyone plays a card face down, and the person who
Speaker 1: played the adjective word looks at all the nouns and
Speaker 1: decides which noun most fits the adjective they played, and
Speaker 1: then whoever whoever played that noun wins that round right.
Speaker 1: Cards Against Humanity uses a similar idea, except they're all
Speaker 1: really really twisted and evil and nasty, and uh they
Speaker 1: show you how wicked your friends are and how twisted
Speaker 1: their minds are. So it's a huge hit, and my
Speaker 1: circle of friends I understand. I know a lot of
Speaker 1: actors and musicians, and we are a dark and twisted lot. Uh.
Speaker 1: And sometimes listening listening in on a game is just
Speaker 1: as much fun or more than playing it. Um. There
Speaker 1: have also been some pretty some pretty nasty canceled projects
Speaker 1: on Kickstarter where Kickstarter has stepped in or the project
Speaker 1: has has stepped in and canceled the project once it
Speaker 1: was revealed that not everything was on the up and up. Uh.
Speaker 1: There was one called the I three Camera Drone Helicopter
Speaker 1: UM and part of it was canceled partly because it
Speaker 1: was using photos that were copied from other projects and
Speaker 1: other products, so it wasn't original work, so that was
Speaker 1: raising some red flags. Also, it apparently the project had
Speaker 1: made some promises that were unrealistic. Uh. And here's another
Speaker 1: thing about the Kickstarter people. They may or may not
Speaker 1: be able to figure out what is or is not
Speaker 1: a realistic goal. You know. It's kind of like, in
Speaker 1: a way, you can compare it to the problem that
Speaker 1: people in the patent office have, where they get a
Speaker 1: path for something, they may not be able to objectively
Speaker 1: tell whether that patent is realistic. So it's I mean,
Speaker 1: that's an issue, right you can't you know, So that
Speaker 1: that was one project that got originally what got the
Speaker 1: approval and then was canceled. Um. There was an adventure
Speaker 1: game that also got canceled because it was copying stuff
Speaker 1: from intellectual property from other projects. So there are projects
Speaker 1: that have been canceled either by Kickstarter or the project
Speaker 1: leader because they did not measure up to kickstarters qualifications.
Speaker 1: So that can happen, and they Kickstarter does try to
Speaker 1: jump on those quickly because again, just like we were
Speaker 1: talking about in the beginning of the podcast, those negative
Speaker 1: experiences can really impact the service as a whole. Yes, agreed,
Speaker 1: But by and large, I think, uh, it's it's going
Speaker 1: to turn out to be a very valuable uh forum
Speaker 1: for people to to get these projects funded when they
Speaker 1: might not be able to other wise. Um, and it
Speaker 1: will probably launch careers. I would think it already has. Yeah,
Speaker 1: it's yeah, it's still a fairly young service, but yeah,
Speaker 1: it'll be It'll be interesting to see over the course
Speaker 1: of time what what sticks. Yeah, And I'm I should
Speaker 1: soon have an experience on my own with one of
Speaker 1: this and then I can at least tell you what
Speaker 1: my experience of using Kickstarter was like, I'm not going
Speaker 1: to talk about the project because that's not the place
Speaker 1: for it, but I will. I will at least at
Speaker 1: some point have an insider's view of what it's like
Speaker 1: to lead a project on Kickstarter, all right, So that'll
Speaker 1: be interesting to see once that turns out one way
Speaker 1: or the other. Um, I honestly don't know what to expect.
Speaker 1: You never can tell. All right, guys, Well, that wraps
Speaker 1: up this discussion about Kickstarter. If you have any suggestions
Speaker 1: for things that we should talk about in the future episodes,
Speaker 1: please let us know. You can send as an email
Speaker 1: that address is tech Stuff at Discovery dot com, or
Speaker 1: send us a message on Facebook or Twitter. Are handled.
Speaker 1: There is tech Stuff h sw and Chris and I
Speaker 1: will talk to you again really soon for more on
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