As crowdfunding has scaled up so too have some of the problems inherent with firing unconditional cash at people whose main selling point might just be their madcap idea. The big names of the category, the Kickstarters and Indiegogos, would argue that’s the beauty of crowdfunding. People donating unconditional cash to someone else’s dream, however incredible (or otherwise) it may be.
But when it comes to crowdfunding technical projects the category functions more as an extended marketing channel playing to an early adopter community of gadget enthusiasts — so there’s understandably more of an expectation of a tangible, functional device at the end of the day. Which makes separating credible hardware projects from incredible fantasies more of an imperative. A potato salad is a potato salad is a potato salad. But a personal teleportation device remains science fiction (for now).
The risk of out-and-out scammers looking to make a fast buck from crowdfunding communities is an inevitable consequence of the rising profile of the category and its flagship hardware successes. Several of the highest funded crowdfunding projects to date have been hardware projects, including the Pebble smartwatch (which raised $10.3M) and Ouya console ($8.6M). Other multimillion dollar crowdfunding raises in recent times have included the Form1 3D printer and 3Doodler 3D printing pen, both now shipped. But there have also been problematic high profile campaigns too — such as the device we dubbed the “impossible” projection watch. Or Healbe’s miraculous calorie-counting wristband. Despite some incredible claims these fantastical gizmos still pulled in big bucks.
Crowdfunding certainly has a credibility problem, and arguably a growing one (Kickstarter used to vet projects before they could be posted but ditched that check and balance earlier this year). But attempting to plug that credibility gap, or at least sprinkle some welcome scepticism on proceedings, is a two-man blog, called Dropkicker. It’s been doing technical investigation of crowdfunding projects — acting as a sort of unofficial consumer watchdog for crowdfunding — for about a year.
I came across their work while parsing the comments on the Ampy hardware project on Kickstarter — and asked them to answer a few questions about their own initiative. “Dropkicker has exploded over the past year,” says co-founder Michael Ciuffo. “There are a lot of people out there looking for some skeptical expert advice, and we’re trying to do our best to provide it.”
Who are the founders and writers of Dropkicker? And what’s your technical background?
Jason Haensly (Occam’s Chainsaw) – I’m a software engineer with 4 years of product development experience. I currently work at i1 Biometrics, a wearable tech startup whose launch product is a mouthguard that measures the severity of head impacts. Before that, I worked with Ciuffo at Synapse.
Michael Ciuffo (ch00f) – I got my degree in electrical engineering from MIT in 2011 and have three years of experience in product development specializing in small, consumer electronics. I worked for Numark Industries (now InMusic Brands) for a year before moving to Synapse Product Development in Seattle.
When did you launch Dropkicker?
Michael: Dropkicker started in the fall of 2013. We just passed our one year anniversary.
What was the trigger for setting it up?
Michael: During the summer of 2013, I found that one of my personal electronics projects (published on a personal blog) had been copied and used to launch a Kickstarter campaign. While I was mildly upset that my name wasn’t mentioned in the campaign (despite the creators emailing me and asking for details a few months prior), I was more upset at their abysmally low funding goal. Having personally built the product in question myself, I knew that they couldn’t deliver with the funding they were requesting.
Ultimately, they changed a fundamental feature of their product in a sort of bait-and-switch cost-savings effort, and delivered a few months late. The delivered product worked well enough to appease the backers, so I’m not going to mention their name specifically. Still, watching this all unfold was a very frustrating process, and it left me wanting a platform where I could explain in full the kind of challenges facing similar projects that many backers may not know about. I ran it by Jason who had some prior writing experience, and Dropkicker was born.
How are you funded? Presumably you still have day-jobs so this is a side project?
Michael: We are funded primarily by our day-jobs, and Dropkicker remains very much a side project. We have managed to get a few hundred dollars in donations and advertising revenue (which we try to be very up-front about), but when spread over the number of hours spent on the site, we’re not even approaching minimum wage.
Do you think crowdfunding is becoming more of a target for scammers?
Jason: Sadly, yes, though I’m not sure they all involve malicious intent. With more and more of the traditional funding sources (e.g. VCs) demanding a successful crowdfunding campaign to demonstrate market viability, we’re seeing an increase in the number of projects with no resources and hopelessly unrealistic goals. Whether they’re a scam or just naive and optimistic comes down to intent, which we can’t possibly judge.
I expect this to only get worse as the pool of potential backers – and their money – continues to grow.
Should crowdfunding sites be offering more checks and balances themselves, in your view?
Jason: The fundamental issue is a lack of accountability. If a project raises some money but fails to deliver, it’s the responsibility of a scattered mix of backers to organize and fight, which is both difficult (since it’s a process that will require both time and money) and often fruitless (since the project creators have likely burned through most of their resources).
Of course, more could be done to prevent questionable projects from getting funded in the first place. Currently, backers really only have access to the marketing materials provided by the project, and the comment section is typically a tangled mess – there are definitely tweaks the sites could make that would improve things a bit. More responsible tech journalism would help too.
Michael: As Jason pointed out before, a lot of the “scams” that we’ve found on crowdfunding sites are really the result of inexperienced people hopelessly overestimating their abilities (look up the Dunning Kruger effect for more detail). This is something that is really impossible to filter out. After all, one of the founding principles of the crowdfunding movement is giving power to the “little guy” who may not have the experience or accolades to get attention from traditional funding sources. So when a project raises over a million dollars for a half-baked idea, can you really blame them for being unable to follow through? They’re supposed to be allowed to fail, but when tens of thousands of people get excited about the project, every false step starts to look like intentional deceit.
One of the biggest contributing factors to this is the enormous amount of pressure from overly enthusiastic tech journalists encouraging backers to flock to these projects without first taking a critical or skeptical view. This adds a false sense of credibility to a lot of these otherwise fledgling projects that they really don’t deserve, and backers get upset when their unrealistically high expectations are broken.
As far as the actual scams go, I am happy to to report that Kickstarter at least has been stepping in lately for some of the more obvious ones. iFind, Scribble Pen, The Rock smartwatch, and Luci have all been shut down by Kickstarter after it became obvious that these projects were illegitimate. We would have rather they step in sooner than the final days of the campaigns, but at least they stopped money from changing hands.
Doing a full in-depth feasibility study for every technical project submitted to Kickstarter or Indiegogo is too large of a task for any company to reasonably offer without substantial compensation, so I recognize that these sites will probably never offer these kinds of services. That being said, there is a huge amount of brain power in the community that could be used to validate projects if they only had access to good information. Many project creators are very tight-lipped when it comes to project details either because they’re hiding something or simply because they’re busy and understaffed. Often requests for more detail or a product demonstration are ignored.
If there’s anything crowdfunding sites could do to improve project credibility, it would be to require creator responses to pertinent backer questions. In a recent case, Kickstarter gave the Scribble Pen project 24 hours to produce a video demonstrating the current functionality of their prototype. Claiming that the request was unreasonable, Scribble left the site for Tilt. Tilt ultimately shut them down when their “product demonstration” was shown to be a fake done in post production. This is exactly the way we see that it should work. If your product doesn’t work yet, be up front about it.
Do you have a few examples of projects that were really problematic which you were able to help sanity check and perhaps even take out of the crowdfunding mix entirely?
Michael: I think our best success story so far is with Scribble Pen. This was a product that claimed to have an ink pen that could write in any color. There were a number of issues with their technical details (for example, using a cell-phone class processor in something as complicated as a wrist watch), but the biggest hole in their story was the lack of video demonstrating their “working prototype”.
We can’t take full credit for getting the project removed from Kickstarter, but when it eventually moved from KS to Tilt, we were specifically recognized in a tweet from Tilt CEO James Beshara who shut the project down a few days later. All it took was a few minutes looking at their new product video and finding some mistakes in post processing between cuts that made it obvious the whole thing was faked.
Our goal isn’t really to get a project taken down, it’s to get creators to be more honest with their backers. We’ve had a number of cases where we found teams that made mathematical errors when calculating their product’s battery life or (my personal favorite) listed quotes from news publications that, when put in context, are actually taken from the Kickstarter project’s own page. Whether these are honest mistakes or malicious attempts to mislead the public is up for debate. The important thing is that they are usually fixed when called out publicly.
Do you also have any tips for crowdfunding backers who are trying to assess the credibility of a project before putting money down — so what sort of things should they be looking for and what questions should they be asking?
Michael: Always demand a prototype. Even if the product seems relatively simple, there are always challenges to bringing it to market, and if the teams hasn’t demonstrated the ability to at least create a single functional unit, there is a very low likelihood they will ship on time if at all. If they don’t have a prototype, they aren’t ready for crowdfunding.
Being mentioned by a major news publication does not mean a product is legitimate. Often this “coverage” is just parroting a press release from the project creators themselves. Think of it as an extended advertisement. Unless the journalist has some outside information either from actual research or some sort of personal interview/product demonstration, ignore everything they have to say. The Scribble Pen was covered positively by The Guardian, Huffington Post, and CNet before it was discovered to be a complete sham.
Don’t be afraid to demand more details. Contact the creator and ask them to provide more detail on the product if you are unsure of its capabilities or level of refinement. Many project creators try to be Apple and keep their “proprietary technology” behind a curtain; some even try to play it off as not wanting to “ruin the surprise,” but remember that they are risking your money on their dream. As a backer, you deserve to have answers. There should be no surprises.
Finally, if the project has already reached its funding goal, really consider what you aim to gain from backing it. Once the goal is met, the team is obligated to deliver the product, so it may be best just to wait and see if/when they deliver. Usually, all you gain from continuing to back is some token “stretch goal” (like more colors!) or some promise of a discount on the final retail price of a product that doesn’t exist yet.
Is Dropkicker intended to be a not-for-profit public service, rather than a startup business in its own right?
Michael: The blog is both a not-for-profit public service as well as a very rewarding hobby. Both Jason and I have learned a lot through our research for the blog which is rewarding on its own, but some of our learning has actually become useful in our professional work as well.