Kickstart my Bank Account

by Chris Markham. 0 Comments

Since it’s come on the scene, I’ve been interested in Kickstarter. For those of you unfamiliar with the service, Kickstarter acts as a bridge between “creative” people and financing people. For instance, if you’re a writer/director/producer and you have a very personal movie that you NEED to make, but no studio will provide you financing, you can go to Kickstarter to make your plea for money. The spectrum of benefits to the donors can be pretty wide; for certain levels of donations you can receive pictures and autographs of those that appear in the move, to a walk on part, to just the knowledge that you assisted a favorite artist complete a project that was near and dear to them.
May times I have contemplated using either Kickstarter or a similar service just to obtain a living wage. Heck, one kid raised several thousand dollars just to make a bowl of macaroni and cheese. Think of the profit margin on THAT. Why can’t I have any good ideas like that one. But no. I have to go to law school and grind out a living. I’m a sucker that bought into the Man’s view of future success.
Well, this week, there were two interesting Kickstarter stories. The first involved a popular video game Website. Usually, the site wrote and produced videos about their favorite games, such as Minecraft. Well, the powers that be at the site decided that, with a little bit of that sweet, sweet Kickstarter money, they could make their own video game that would kick the butts of the games they write about. To raise money for this ambitious project, they turned to good old KS.
In return for cash, the site promised the usual laundry list of incentives depending on the amount of the donation (or investment; I’m never too sure). A couple years came and went and no game. Finally, about a week ago, the site said that the game wasn’t going to happen after all – that after a great long while of developing and revising, the money ran out and the game could not be made. Sorries all around. And no refunds.
All investment contains risks. Property values and stocks can decrease. Banks can (and have) gone out of business. Companies fail. So to lose money in a Kickstarter campaign, while not illegal, certainly appears to burn investors emotionally more than, say a huge hit to a mutual fund. In this instance, a case could be made that there was endemic misrepresentation on behalf of the site – that they never intended to develop and release the game. Or that the site took all of the money and squandered it for purposes unrelated to the original project.
Now, it’s my understanding that most individual Kickstarter donations are less than a hundred bucks. To go through the aforementioned time and effort over a Benjamin would seem ludicrous – filing a complaint in most jurisdictions costs more than that. Thus, it would appear, the site, while not completely immune to legislation, certainly makes it difficult and not cost-effective.
The other interesting Kickstarter story this week concerns a single mom that allowed her eight year old child to play at a park across the street from their house while the mom went to work. Of course, that could (and should) be considered child endangerment, and the mom was arrested and charged with that very crime and fired from her job. Now, I’m not here to argue the socioeconomic realities facing the mom. But a Kickstarter campaign to help her get back on her feet after the arrest and subsequent termination of her employment raised approximately Twenty Seven Thousand dollars. Think about that – Twenty Seven Thousand Dollars. I’m glad there are such generous people out there, and that these people aren’t (or at least shouldn’t be) expecting some return on their investment.
Now you see what I’d like to use Kickstarter for my own nefarious purposes? It certainly seems like there’s virtually no liability to accept donations and not deliver. Or, I can engage in questionable behavior and have thousands of people bail me out of my financial and legal issues.
It will be more than interesting when and if the class-action suits come a calling.


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