App.net Launches Backer, A Bitcoin-Friendly Crowdfunding Engine For Individual Software Features

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Overseeding Will Be Key To Strong Venture Returns

As the popularity of crowdfunding grows ever larger, an interesting new trend has started popping up: developers, curious if a new feature is worth adding to their products, are asking interested customers to chip in to cover the costs of development. In other words: if you really want a feature, put your money where your mouth is.

Balanced, a payment service, recently used crowdfunding to support adding a new money sending feature. App.net, a subscription-based/ad-free Twitter alternative which as a whole was born out of a $803,000 crowdfunding campaign, is currently using it to determine if they’ll accept Bitcoin payments on their site.

This morning, App.net announced that they’re opening up the engine they built for their Bitcoin campaign, allowing other companies to use the platform to raise money for individual features. They’re calling the new platform Backer.

app.net

App.net’s original Backer campaign, currently underway, to determine whether the social network would accept Bitcoin payments for account subscriptions

Amongst other things, Backer has two big standout features: developers can choose to accept payment via credit cards or Bitcoin (or both), and open source projects aren’t charged any fees. (If you keep your source locked down, however, there’s a 5% fee taken only if/when your campaign proves successful.)

Why build a whole new platform? Why wouldn’t developers just use one of the other, less-specific crowdfunding tools? I asked App.net founder Dalton Caldwell, and here’s what he said:

If you recall, App.net wrote our own crowdfunding tool because the Kickstarter TOS specifically didn’t allow software/service businesses. That is still the case. 

The impetus for us building and launching this now was that we were trying to figure out whether or not to accept bitcoin for App.net subscriptions, and every single other startup founder I asked said they were wondering the same thing. If you survey the current tools available, there are none that would work for this. When I asked other founders if they would use something like Backer to decide whether or not they should accept Bitcoin they said “yes”.

(To clarify, Kickstarter’s TOS explicitly blocks campaigns for “websites or apps focused on e-commerce, business, and social networking.” and “software projects not run by the developers themselves”. Games are usually okay, but other software-only campaigns often aren’t.)

Each new crowdfunding platform to pop into existence has to make one rather important decision right off the bat: whether or not to curate. Do you hold the reins tight and go for quality over quantity, approving only the projects that you think will succeed… or do you let everyone in and let the money speak for itself? With Backer, App.net has gone with something closer to the first option: according to their FAQ, “projects will be vetted to ensure your Backer project runs alongside other high-quality, legitimate projects.”

Interested in being on of the first projects on the site? You can find the submission form and all the other details right over here.