Crowd-funding website Kickstarter has helped hardware and software manufacturers raise millions of dollars for their projects, now the company is making it harder for future companies to raise the same type of money thanks to more stringent page guidelines.
Kickstarter recently sent out a memo to project creators to inform them that Kickstarter is “not a store” and that they must now clearly outline the “risks and challenges” associated with their future products.
The popular funding platform has been hit with several high profile scams and failed projects which has left Kickstarter participants with no final product for which they spent money to help produce.
Kickstarter is now asking developers to answer the following question:
“What are the risks and challenges this project faces, and what qualifies you to overcome them?”
By expressing major concerns associated with product builds potential investors will be able to better assess the chances that a product will actually make it to market.
Kickstarter is also asking that project designers “under-promise and over-deliver” which includes removing the ability to show product simulations. Rather than providing a pretty “final design” developers can only show off their products as they exist at the time of the posting, using real photos from their still being built product.
Developers will also no longer be able to offer mass quantities of items to people who pledge additional money to a project. Instead only one product or a “set of products” can be offered to each investor.
Products do not always arrive at market once funding is provided, hence the fact that investors meeting with a company will ask for a lot of market research before they are willing to invest. While individuals putting up a few dollars or even several hundred dollars might not make the same considerations as a large scale investor, the new Kickstarter guidelines at least make potential low-risk investors realize some of the risks associated with new products without getting their hopes up too much.
theONION’s satirical commentary on the problems Kickstarter faces:
[Image via incgamers]