Since it went live in 2009, the populist fundraising website Kickstarter has been the go-to place for those who need cash for do-it-yourself projects of all kinds, from comic books to indie movies to iPod watches. But the site, which pitches itself as a collaborative alternative to traditional venture capitalists, had never featured a $1 million project — until last week, when two projects surpassed that threshold over the course of 24 hours. That's real money, and it's turning heads in the business world. Here, a guide to the latest twist in Kickstarter's "trailblazing" path:
Which projects passed the $1 million mark?
The first was the Elevation Dock, a sleek, aluminum iPhone dock that attracted more than 10,000 individual donations. The second was Double Fine Adventures, a throwback video game of the point-and-click variety developed by Tim Schafer (of Psychonauts and The Secret of Monkey Island fame).
Is this a trend or an anomaly?
It looks like Kickstarter's solidly on the upswing. Schafer's haul of $1.6 million surpassed the site's previous one-day record of about $740,000 — which had been set the previous day. And Kickstarter garnered more than $100 million in donations in 2011, up from $28 million in 2010.
Do the project donors receive anything in return?
Unlike venture capitalist firms, Kickstarter donors do not receive a cut of future profits in return for their investment. (In the case of Double Fine Adventures, donors will receive a copy of the finished game.) Kickstarter doesn't want to be a traditional investment company, according to co-founder Yancey Strickler. "That's the disruption of Kickstarter," he tells GigaOm, "changing the question from 'Can this make money?' to 'Should this exist?'"
What does this hold for the future of crowd-sourcing?
A wide array of industries could see a "profound" shift away from traditional sources of funding, says E.D. Kain at Forbes. Is it possible that venture capitalists and middlemen will be replaced by "a whole new era of grassroots fund-raising and audience participation?" Kickstarter "will change the world," according to Greg Tito at The Escapist, particularly in creative industries where developers have traditionally relied on big companies and studios for financial backing.
THE WEEK'S AUDIOPHILE PODCASTS: LISTEN SMARTER
- Russia's giant spy ship was a high-tech disaster waiting to happen
- What would a U.S.-Russia war look like?
- America created the Islamic State of Iraq and Syria? Meet the ISIS 'truthers'
- How American businessmen are ruining American business — and the U.S. economy
- The Obama era is over. The presidency continues.
- On ISIS, neocons and liberal hawks have a 'boy who cried wolf' problem
- 10 things you need to know today: September 2, 2014
- 11 scientific studies that will restore your faith in humanity
- The 10 best networking tips for people who hate networking
- How to stop misogynists from terrorizing the world of gamers
Subscribe to the Week