A wish list for crowdfunding platforms

There are currently five items in my wish list for services offered to backers from a crowdfunding platform, such as Kickstarter.

My wish list is:

  1. A simple rating card about the project creator.
  2. Rating and reviewing the project creator via an online forum.
  3. Greater transparency about how the pledge will be shared between Kickstarter, Amazon Payments and the project creator.
  4. A clearer description of the legal rights and responsibilities of all parties involved in the crowdfunding transaction.
  5. Tracking the rate of successful delivery of rewards per category in aggregate on the Kickstarter stats page.

Each is explained in more details below.

1. A simple rating card about the project creator

In the same way that a credit rating report gives a snapshot overview, a rating card for project creators on Kickstarter would be beneficial. This simple rating card should give me the following information at a glance:

  • Is the project creator an established company?
  • Is this campaign the project creator’s first?
  • Is this campaign a reboot? If yes, please link to the previous campaign.
  • How successfully has the project creator raised money in the past via a crowdfunding platform?
  • How successfully can the project creator deliver?
  • Can the project creator’s auditor confirm that the company is a going concern, as at the start of the funding campaign?

All of this information is to a certain extent available on the project description template, but it can be easily obscured or not completely filled in. A simple check card displayed in the project creator’s information section would be really helpful.

2. Rating and reviewing the project creator via an online forum

In the same way that I can rate third-party sellers on Amazon, and their products, I would like to be able to rate and review the project creators and products offered for rewards. This rating could be based on:

  • interaction with backers during the campaign;
  • interaction with backers post campaign;
  • the actual communication received from the project creator regarding timelines;
  • delivery of the reward and all unlocked stretch goals; and
  • the quality of the reward, as per the description on the Kickstarter page.

The inability to currently rate and review a project creator is contrary to Kickstarter’s stark warning to project creators that if they don’t fulfill rewards, they may ruin their reputation. This reminder to project creators that their reputation will be negatively influenced is moot if the community cannot help create and endorse the reputation.

3. Greater transparency about how the pledge will be shared between Kickstarter, Amazon Payments and the project creator

The reward levels and fees should be more transparent. There should be a lot more clarity about who pays the services fees, and what percentage of the total amount pledged actually goes to the project creators.

For example, if the reward level is $40, then $2 goes to Kickstarter, $1.2 to Amazon, $0.60 is VAT on the service fees (all non-refundable), then $36 goes to the project creator for manufacturing, shipping and other business expenses.

If the backer increases the pledge to $60 for the same reward, then $3 goes to Kickstarter, $1.8 to Amazon Payments, $1 VAT (all non-refundable) and $54.2 to the project creator.

4. A clearer description of the legal rights and responsibilities of all parties involved in the crowdfunding transaction

Currently, the terminology used to describe the crowdfunding process can be emotive, with limited clarity on the rights and responsibilities of all parties involved in the transaction.

This is further complicated by the actual crowdfunding process, namely when money is taken from backers, and when legal title over the reward is transferred to backers. I also am not sure to what extent my statutory rights apply to a crowdfunding transaction.

A bit more clarity on rights and responsibilities would be a great step forward.

5. Track the rate of successful delivery of rewards on the Kickstarter stats page

As I mention elsewhere, it is relatively simply for Kickstarter to actually track and project whether the success rates of actual delivery of rewards to backers per project and per category. I would be very interested to see these stats on the  Kickstarter stats page.

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