Indiegogo in particular is super sketchy, I did a campaign with them and they had an employee there contacting me and telling me all the shady stuff they can do to help me be successful and if that I can guarantee I'll raise x amount they'll do all these extra things like put it on the front page and in the newsletter and whatnot. They let you extend campaigns forever if you arne't about to hit your goal so you can keep saying "ending soon", then if you do hit your goal, instead of ending, they will let you keep it open to ride the momentum of that, or they will then let you up (or down) the goal and change the date so you can keep catching people who want to just be able to get it, or who want to pile on to a super successful project whose goal is now 1/10 of the original so it looks even more legit. You can also back your own stuff anonymously for as high as you want, so often you'll see campaigns with like $1MM and only like 20 backers and most are anonymous or not listed and you know obviously 20 people couldn't have legitimately backed for that much.
I can't recall a lot of the other stuff you could get away with, including have no proof of concepts and just using renders and being fully funded already and such, but I had to unsubscribe from their emails it was so disgusting. You can tell if you look at their site overtime which kinds of things just stay up forever or how they instantly are over the goal and whatnot. One item stayed up for like 8 months, constantly over the goal.
Funnily enough just this morning my inbox has this:
Subject: Your Indiegogo Innovation Award
We're excited to inform you that your project
is eligible to receive an Indiegogo Innovation Award this January!
To honor your crowdfunding achievements, we cordially invite you to reserve your award, available for pick-up at this year's Consumer Electronics Show in Las Vegas.
Our theme at this year's CES is "Indiegogo Means Business," and your campaign is proof that creative ideas indeed grow into successful businesses with Indiegogo. As only 100 entrepreneurs will receive this gift, we hope you enjoy it as much as the Indiegogo community has enjoyed your ingenious ideas.
Well, what do you expect? the more money you raise, the more money they earn. Kickstarter isn't better, they allow campaigns to put a staffpick logo in their description even though there was no staffer picking that campaign. They are both as scummy IMHO.
They allowed the same business to run multiple campaigns concurrently, opening new ones when the old ones were not even fulfilled. Turns out these scammers were using new funds to fulfill old campaigns and since a ponzi scheme always collapses...
I could go on and on like this with Kickstarter.
I studied their business model a bit, and came to the conclusion that these businesses are actually B2B with the appearance of B2C. These are marketing platforms,selling marketing services to you,
paid by fees and the client is you, the project creator, not the backer since they successfully claimed they have zero contractual obligations toward backers. But backers are still billed by Kickstarter, at no point the project creator issues a bill or is forced to issue one. This is extremely clever from a legal perspective and it is what sets them apart from ebay and likes. But what are backers billed for then? that's the most interesting question, they they are not billed for the good they "backed"...
This is fascinating. I, too, had a weird experience with Indiegogo.
I was raising funds for a project, it was going OK (not great but OK... I had two or three backers after a few days), it was climbing the ranks of active projects, and then suddenly it disappeared from the search results entirely. It wasn't a slow descent into irrelevance; it was sudden and total.
Multiple emails and phone calls to Indiegogo resulted in zero response from them. The project close, the funding was sent to me, and I had to manually refund my few backers because I couldn't possibly fulfill their expectation with so few supporters and so little money.
I suspected foul play but had no proof. Now I'm thinking this is much more wide spread than I ever realized.
“all the shady stuff ... things like put it on the front page and in the newsletter and whatnot.”
I really don’t get how you could consider them helping to promote popular campaigns shady. I mean it’s the very point of the entire platform, and how both they and their users and the backers of projects gain value.
Never pledge on indiegogo, it's for scammers only. Kickstarter (for all it's warts) requires a working prototype to post on their site. IGG requires no such proof that you aren't selling vaporware. Also IGG shows total pledge numbers from IGG PLUS Kickstarter (and potentially other crowdfunding sites you might post to) so that their numbers look bigger.
Stop, Drop, & Retro has some really good YouTube videos calling out IGG/KS campaigns (focused on the retro gaming scene) and he does a decent job breaking it all down.
Claiming either is great, but I have been scammed more on KS than Indigogo. Today I super weary of both, but I have and will back projects by people who I know or whose reputation I know though other channels. (OLKB, TinyFPGA, etc).
These campaign would never be successful without the copywriters on popular digital media promoting them because they are content farms looking for cheap "news".
Wired, CNET, and all these prominent outlets, when was the last time they issued a follow up when something turned out to be a scam? when did they ever put a disclaimer about the risk of crowdfunding in their article? and let's not even talk about the fact that they don't even state clearly that the product doesn't exist and they never even tried it. Without shills, scams can't be successful, they are the shills, literally by the definition of that word.
It will, metaphorically, if a lack of funding will kill the product (or prevent it from ever being made). Crowdfunding is a financing option, complete with the part where the financiers are exposed to risk.
The ones I hear talking about their sponsoring, is that they know full well. I hear phrasing such as "shooting some money their way in case they succeed" and "it's an interesting project, let's hope for the best".
There is often very little risk... a small amount of disposable income to potentially get an interesting niche product. It is not meant to be a "smart" money decision. Not sure where you are getting that idea from...
If you are talking about kickstarter and the like, no, there is a very real chance you will not be able to buy it if you don't fund it. There is also a very real chance that you won't get it even if you do fund it. And if it doesn't get funded in the first place, there is zero chance. Unless you were referring to some other sort of funding process.
FWIW I do not participate in kickstarter, but that is because I like having things I spend money on. I know plenty of people who do. So, I think it's in general a good service.
My $100 (or whatever) isn't likely to be the difference between something being funded or not; if it's going to be funded anyway, I might as well let some other guy put up the money, and I'll buy the product when it's available generally.
Crowdfunders are exposed to risk, but they aren't going to profit. Real investment comes with the prospect of an actual upside for the investors, but if I can just buy the product later when it actually exists (crowdfunding discounts aside) why not just do that?
"My $100 (or whatever) isn't likely to be the difference between something being funded or not; "
It absolutely will.
I have a very close acquaintaince in the process of doing hardware (and I have experience with this myself).
Getting the first production run is brutally difficult, and the operating captiol requirement just doesn't exist.
VC's don't want to pay for it, and neither do business development banks.
Though I think there is a lot of scamming ... 'hardware is hard'. Really hard.
I actually believe a lot of it is 1/2 way - they raise money with good intentions, but then are just stupid and lazy in getting production up, and then can't afford it. Once a team has 1 million - if they get production up, maybe they get 100K in profit. But if they 'fail' to get production up ... they can keep maybe $700 in 'profit' i.e. what they didn't spend on units.
Maybe a better solution would be to have escrow and pay on delivery, with partial payments or something like that.
You're entirely correct. I have not, however, seen anything so critical that the world would suffer if it did not come to fruition. We're no worse off if that smart water bottle never gets made. The environment might even be better for it.
You could say this about anything though, so it's not very damning criticism of Kickstarter. Also applies to Hacker News and everything, individually, at the grocery store. And all the Amazon boxes piling up on our doorstep from holiday deals.
Maybe you'd agree with that. I just never was a fan of the "oh, it's those people who are doing it wrong" as we ourselves indulge in a different set of the same thing.
If it was "moved" then that might mean the $460k are included in the $806k. Don't ask me how that "moving" could be done, but they explicitely said "move" and explicitely said that it collected $800k altogether. That would be surprising if it actually made the sum of both.
I get a lot of ads on Instagram to products that lead you to Kickstarter/Indiegogo sites.. and they seem to always have 6-digit dollar amounts in backing. What I've read is, that's also fake, like asking your friend to bid on your auction on eBay, they just make a second account, pretend to back the product, and poof, "See, it's a popular product!".
Do the platforms get a percentage from each backing? If so, we can see why they don't care if the product is real or not...
What I've gathered from my own and others experiences: Just avoid Indiegogo and Kickstarter and buy the inevitable Chinese knockoffs if the item is successful. With this possibly unethical method, you might even get the item before the pledgees.
An article this long, and no mention of who it is? Feels strange to read this detailed investigation into the identity of “he who must not be named”, when the whole point of the article is the identity of the person.
In Sweden, this is not a consequence of any law, but by common journalistic practices. Media are protected by constitutional writings that extend very far in terms of the sender's rights to publish. However, Swedish media also has a long tradition of keeping themselves to de facto standards when it comes to things such as identifying individuals.
It would have been _very_ weird to see this person named on Breakit.
I bought a product from Aliexpress (12 euro IoT wifi relay) which i later found in the exact same name and package on kickstarter for around 20 euros. I contacted kickstarter, who quite abruptly removed the kickstarter. If their only intentions were faul they would have let it be, but they actually did the right thing in this case. Just offering another perspective of their work.
Help me understand why the consumer protection is not used here?
In order to do card payments the merchant (IGG) need to be able to refund. It they cannot, the acquirer must do so. Anyways, one of the purposes of Visa and MasterCard is protection from these scams. If you don't get 100% of what you bought, you can get refunded by the card issuer, which will collect acquirer/merchant.
Maybe because the consumers are investing in a future product. It is not the same as buying directly online from ECommerce store like Amazon. Investing implies risk. The consumers can probably still get a refund for fraudulent charges from CC.
Unfortunately, back in 2014, I contributed to an Indiegogo campaign for DreamQii PlexiDrone 8 blade drone. It has not shipped, though they've been in a state of almost shipping for about two years. Lesson learned. DreamQii raised over US$2.2 million.
sending cash, to someone who can't at this time provide you the product you want to buy, and who makes no bones about not providing you with any assurances that they ever will is a calculated (and easily avoided) risk. You can evaluate if it is worth being taken for the product you may or may-not ever receive.
The fact that a house-fly already has the statistical intelligence for funding Indiegogo projects doesn't mean that there isn't any
I wondered why the platforms can't help track down the creator, based on login information. Sure, you can cover your tracks, but I'd think they'd have the incentive to make it look like they're doing all they can to root out fraud/fraudsters.
If you demand protection by the law against being taken advantage of, the law should strip you on a gradient of your rights & obligations as a adult for the return of your "investments".
Somebody who is not capable to evaluate a product and believes in magic, shouldn't have the guardians right to decide against vaccination for their kids.