Kickstarter Projects That Don't Meet Their Goal Are Not 'Failures'; They Help People Avoid Failures

from the remember-that dept

A little while back, on one of our “funniest/most insightful comments of the week” posts, we featured a comment that someone made anonymously, in response to a story about Bjork’s Kickstarter project that was taken down before it ended, after it did not look like it was going to get anywhere near the required threshold. However, the comment has stuck with me and I think it deserves a post. In particular, the commenter called us out for saying that her project “failed.”

This was not a “failure!”

Platforms like Kickstarter have changed the way the market is functioning, and our ways of thinking about it (even here on Techdirt) have to catch up.

Bjork’s campaign did not fail, even though the results were not what she was hoping for. She successfully learned that the market was not interested in this product.

Spending £375,000 of her own money? Now THAT would have been a failure.

Using Kickstarter is more like running a science experiment than it is like selling a product. It increases the efficiency of the market by orders of magnitude, and apparently beyond our ability to think about it clearly.

This point — even if it was calling us out — is so true, and it’s so important for people to understand. It’s easy to use the word “failure” for those projects that don’t meet their goal. Hell, just in writing this post, I repeatedly had to consciously stop myself from using the words “fail” or “failure” in describing projects that don’t reach their goal. But, the commenter is right: those projects are not failed projects once you realize what Kickstarter really is: a platform to judge the market for products, and to build commitment and funding around them. If a project doesn’t reach the goal, that’s actually valuable market research, suggesting that if they had gone ahead, without going through the experience, they likely would have “failed.”

So, in actuality, it makes sense to look at such projects and recognize that they were saved from a dismal failure, in which large sums of money may have been spent, but at the same time clarifying the market’s reaction to a product before it’s even been introduced. With so many people thinking of Kickstarter more as a store, than as a platform for supporting people trying to turn cool ideas into reality, it’s important to be careful in how we choose our language. Putting up a Kickstarter project that doesn’t reach its goal shouldn’t be seen as a failure. It should be seen as a useful bit of data, which helps one avoid failure, and also to (hopefully) sharpen up their product and pitch so that the next time, it is more likely to be funded.

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Comments on “Kickstarter Projects That Don't Meet Their Goal Are Not 'Failures'; They Help People Avoid Failures”

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Chosen Reject (profile) says:

Re: Re: Indeed

I’m glad the AC mentioned it. I thought it was obvious. Heck, that’s what the whole Veronica Mars thing was yesterday. Warner Bros. said they’d make a movie if they could get a Kickstarter project past it’s goal. In addition to being a funding platform, it’s very useful as a market gauge.

It’s also useful to see where money is being left on the table. Taking the Veronica Mars example again, consider how fast some of the upper tiers went. That means it is likely that they could have sold them for more or could have offered more of them. But even the fact that they were sold shows how much money is too be made from movies rather than just ticket sales. This is the loooooooots of t-shirts thing. They already sell t-shirts and other merchandising of stuff, sure. But they just made $25,000 for 250 people to see a movie screening. That’s an average of $100 each.

Movies are excellent examples of giving away the scarce to sell the abundant. People pay to go to the red carpet movie premier just to see the stars outside. That’s scarce. Capture some of that! 50 people just paid $750 for that. That’s $37,500 for 100 tickets. Assuming a normal $12 movie ticket (I’m guessing here, haven’t been in a long time) it would take 3,125 normal ticket sales to make that same kind of money.

These are just some of things we learn with Kickstarter. I suspect it’s only beginning.

Internet Zen Master (profile) says:

Re: Re: Re: Indeed

Hmm… Makes me wonder if we could convince a few TV companies to launch kickstarter campaigns to prove there’s demand to keep certain TV shows on air, and not either a) put them on hiatus indefinitely [Exhibit A: Cartoon Network’s Thundercats reboot. Went on hiatus for no apparent reason after dumping a major ‘wth?’ plottwist and leaving the story open-ended] or b) cancel them because of their own stupidity [Exhibit B: Disney’s Tron Uprising, which Disney kept kicking around its TV schedule, and it finally ended up at midnight on a SUNDAY for no apparent reason. That time period is more or less a death sentence for TV shows, and Disney execs know that.]

One can dream I suppose.

sehlat (profile) says:

Definitions of "failure"

There is only one true definition of failure as it applies to the example cited: any event or experience from which one does not learn.

One commonly cited example on this blog involves legacy industries refusing to learn that they don’t own their customers, despite many well-funded attempts to do just that.

The anonymous commenter was 100% correct.

out_of_the_blue says:

As Japan said after WW2: "not necessarily in Japan's best interests..."

Yes, if you redefine “success” as stopping the feasibility study, it’s a success!

What I want to know, and it’s kind of key: does Kickstarter still get paid its 5 percent? Cause that gives it a perverse incentive, ya see.

2nd question: so how the heck is this different from marketing studies done for the last hundred years at least? Because it’s on “teh internets”?

3rd: how can it be good that Bjork isn’t out some cash?

4th: how is this reflective of the actual product that would have been made? One never knows what confluence of creativity can occur.

5th: doesn’t this prove more that funding on a shoestring (by which I mean WITHOUT crowd-funding) is likely to force the creator to think more carefully on whether it’s worth investing the time, and/or to come up with something better? What we get in this case is simply a flopped idea; IF the crowd had been swept along with enthusiasm, for whatever reason, then they’d have been out money for a flop!

6th: let’s learn some more from, er, pre-empted successes. Find more stories like this, Mike.

Take a loopy tour of! You always end up at same place!
Every “new business model” here requires first getting valuable products — including money and labor — for free.

Anonymous Coward says:

Re: As Japan said after WW2: "not necessarily in Japan's best interests..."

Do you type only the get attention? It took 30 seconds to answer the first question: “Kickstarter collects a 5% fee from the project’s funding total if a project is successfully funded.”
Question 2: Generally you had to pay to get your marketing studies done. This was feasible because it still cost less than rolling out a succesful product.
3. Well that depends or whether you are Bjork or not doesn’t it. If it isn’t good that people aren’t out cash donate a couple of hundred to techdirt.
4. If you make a different product than what your market research was on how is that data still valid no matter how creative the change is?
5 Part a answer No
5 Part B If you get several thousand people will to part with money to fund a project there is a much better chance that the product will turn a profit.
6. You still haven’t

Chosen Reject (profile) says:

Re: As Japan said after WW2: "not necessarily in Japan's best interests..."

  1. No, Kickstarter only takes money if your project is funded.
  2. Marketing didn’t also collect funds.
  3. What?
  4. Because I’ve never seen a KS project that had Creative Director as one of the rewards for pledging.
  5. You’re argument is that making something without input from your buyers as to whether they want to buy is a better way to determine if it’s worth your time? Seriously? I’m not going to say every successfully funded KS project turns out to be a money maker, but surely the track record is better than the alternative.
  6. We’d all like you to learn. You should look into that someday. It’ll help you out.

    Take a loopy tour of out_of_the_blue’s comment history! You always end up at banging your head!
    Every “comment” here requires first getting valuable articles — including ideas and the forum — for free.

Anonymous Coward says:

Re: As Japan said after WW2: "not necessarily in Japan's best interests..."

I’m probably going to regret answering ootb, but….

1. Straight from Kickstarter’s FAQ: If a project is successfully funded, Kickstarter applies a 5% fee to the funds collected.

2. Marketing studies are usually done without a product or if there is its a prototype, but there the question would be if someone might buy the product. Here people are doing more than just answering yes or no to a question, they are actually pledging money. I could easily say yes to a product in some sort of poll as to whether I’d buy something, doesn’t mean I actually will. But if I give money ahead of time, then yes I do want the product and if I’m not getting a copy from my pledge, I will buy a copy or whatever the case maybe.

3. Loosing money is never a good thing.

4. True, but say you get substantial more funding then you asked for. As seen in some recent projects. Now you can do more, add those things in you might not have, add more people, which then adds to the pool of creativity. Works both ways.

5. Only the one creating and those consuming can judge whether something is a success or useful. Just cause you say its a failure or a flop, doesn’t mean it is to others.

6. No body said that unfunded projects are a success, they are just not failures. The creator learned that his idea may need work or there isn’t the market they thought there was. This is just a new means of research.

jameshogg says:

Re: As Japan said after WW2: "not necessarily in Japan's best interests..."

  1. Kickstarter gets 5% still. And yes, they are justified in pushing the best projects to their site’s front page. They are no different from any other publisher that hides its success and failures.
  2. It isn’t different. More of it is to come and it’s going to get a whole lot better. What’s your point?
  3. I don’t know who Bjork is, but in any case this seems to be a silly ad-hominem. In fact, even if fools like Justin Bieber get millions for producing mediocre music it still shows the system works as expected.
  4. You never know of what you pay for with creativity. It’s the same with buying a DVD for the first time – by definition you do not know what you are supporting until you watch the movie.
  5. Nonsense. As competition grows in the crowdfunding market, creators using crowdfunding will have to work harder to win over buyers. Also, you cannot exactly imply that normal DVD producers cannot second-rate crap and still sell out. And by the way, since we already know that publishers are prepared to put money into projects with the possibility that they may walk out with losses and not profits, they will take this fall still by refunding crowdfunders if the project fails. All it takes is the first crowdfunding website to offer this guaranteed refund, and many crowdfunders will flock there instead. We know the market exists, because publishers take this fall in any case.
  6. I’m way ahead of you, thank you very much.
  7. This is not a new business model, it is a new ECONOMIC model, because it is independent of Copyright: crowdfunding is intellectual servicing, which is far superior to intellectual property. And for a model that is supposedly free there does seem to be a good deal of… paying, involved. Also, I wish you would stop implying that if you follow Copyright law you necessarily fund creators – I can borrow DVDs from friends, follow every Copyright law out there, and still give the creators nothing. I do not choose to do this. What about you? I doubt it.

    And to conclude, your hysterically imagined circular logic supposedly coming from Techdirt, which is what I assume it is from your encouragement of taking a “loopy tour”, was funny the first thousand times but now it is just boring.

Kevin Clark (profile) says:

People will keep screwing this up

It’s totally true – not meeting your goal is super valuable. And Kickstarter as a platform has MASSIVE potential as a pure market research tool. But the need to put your name on the front of things, combined with hard-as-concrete perception of failure, is an obstacle to using it that way. Most people I know who go to Kickstarter have already decided what they want to do, and are looking for the money. And if you’re that committed, a failure to meet the goal really looks like a failure. Feels that way, too.

But people don’t want to go to Kickstarter before they’re sure that what they’re doing is awesome – they want a great pitch that they believe in, after all.

That gap, between the perception and reality of not meeting your goal and failing at something, represents both a set of attitudes that we can work on, and a great business opportunity: to BE the entity that fails on behalf of projects.

Just a thought….

Jeffrey Nonken (profile) says:

“I never allow myself to become discouraged under any circumstances. I recall that after we had conducted thousands of experiments on a certain project without solving the problem, one of my associates, after we had conducted the crowning experiment and it had proved a failure, expressed discouragement and disgust over our having failed ‘to find out anything.’ I cheerily assured him that we had learned something. For we had learned for a certainty that the thing couldn’t be done that way, and that we would have to try some other way. We sometimes learn a lot from our failures if we have put into the effort the best thought and work we are capable of.” – Thomas A. Edison, 1921

Jim G. (profile) says:

Re: Re:

Jeffrey, excellent connection! I was the original AC who posted the comment this article is about, and this Edison quote is one of the things I was thinking of at the time.

It’s interesting in this context to reflect on Edison?s statement, “I see a worthwhile need to be met and I make trial after trial until it comes. What it boils down to is one per cent inspiration and ninety-nine per cent perspiration.” People usually skip the first sentence so they think Edison is just talking about hard work being necessary for success. He?s actually talking about hard work that most people would consider spectacularly unsuccessful.

It?s a shame I originally posted as an AC. Now I’ve learned if I want my 15 seconds of fame I need to put something in the “Name” field.

jameshogg says:

More experiments on the way.

It is still a failure in the basic sense that the project did not get off the ground, but yes there is something to be said in how nobody loses out if the project goes under.

Expect more of this experimental attitude, by the way. Watch as people will vote on projects they wish to see from creators, how much they’d be willing to pay for a “ticket”, how creators will have multiple projects up at the same time and let fans pick whichever storyline, art style or other concept works best, how they will split the project into categories of “special effects, cameras, bonus songs etc” to see exactly where people want the money to go, how funding campaigns can be divided for each chapter of a book or each volume of a comic, how eventually Kickstarter will allow projects to continue to receive funds after the deadline so that people can still contribute to making the project better. And this is just the tip of the iceberg.

I still laugh when I hear Copyright believers don’t want crowdfunding to happen, all because it will challenge their beliefs in a very profound way. Some of them no doubt even would want to make the existence of crowdfunding websites illegal (they probably would have been under SOPA). It’s ironic for this bunch of folk: demanding that creators get paid while desperately fighting against the greatest, most revolutionary way that creators all over can get paid in ways that would make the jaws of sincere Copyright economists drop. Intellectual servicing trumps intellectual property.

To say that us on the Copyright abolitionism side of the debate do not want creators to be funded is a stupid attempt at a slander. We can solve the free-rider problem much better than you can.

jameshogg says:

Re: Re: More experiments on the way.

Yes. Just wait until Radiohead tries it. They were so close last time, but the “pay what you want” does not quite give the same level of accountability that crowdfunding does (they made the album first, then recuperated after, which is a bad move). “Pay what you want” is also, unfortunately, still a form of intellectual property.

Intellectual servicing is where it is at. No rights get compromised, and you have both original and deviant markets similar to the fashion industry’s perspective. You will of course see crowdfunding websites becoming too corporate and too rich for their own good, but it is best to save that separate working-class fight for another day and focus on the powers of the free market for the time being.

And the best way to support the free market here is to fight Copyright.

Anonymous Coward says:

Actually venture capitalists are asking people to do a Kickstarter to see if it works or not.


The financing people are hard on our behinds to get this product in the market. The idea for the IndieGoGo campaign came to us from one of our financial advisors; suggested as a means to retain a greater share of equity in our company during the earlier days of design and prototyping.

jupiterkansas (profile) says:

Locally, I’ve seen too many Kickstarters for projects that are going to happen anyway, and they’re just hoping to get more funding and not use their own personal funds.

Some even see it as just a marketing tool – a successful campaign is something to brag about and build audience.

And a lot of projects were successful not because of the final product but because of the personalities involved, their status in the community, and their ability to get friends to donate.

These aren’t necessarily bad things – Kickstarter is still serving a useful purpose – but they’re not what pure Kickstarter projects are all about.

I think most people still see failure to raise funds as a personal failure, and not that the project wasn’t worthy. Obviously they think it’s worthy or else they wouldn’t bother with Kickstarter.

Bdhoro says:

All failures are not

As far as macro economics is concerned, this idea applies to all failures at any level – especially actual big time loss failures. Every failure in every market is really just market research for the survivors and especially for those who failed. Kick starter is unique bc it acts as an agressive chapter 11, failure is forgiven and forgotten as fast as the next project can be proposed.

PaulT (profile) says:

I’ve seen this recently with a couple of movie projects that I pledged to but which didn’t ultimately reach their goal (not a problem for me, since Kickstarter don’t take a penny unless the project is funded).

One (a sequel to a cult slasher movie) appears to still be active, though they’ve been careful to let fans know that the project is still on the table, they just have to work out the direction they need to go. Not a “failure”, then, any more than a project not immediately greenlit by a major studio is a failure.

The other is more interesting in terms of Kickstarter (an interesting project from a guy with just one other film under his belt as director). The first attempt at funding was what many would call a “failure”. It only raised ?33k of its original ?100k goal. Rather than give up, they merely re-evaluated their requirements and set a new campaign a few months later with a much lower initial target, but promising extra bonuses for meeting later targets as they’re announced (which I believe are retroactively applied for existing funders). Needless to say, although they’re still short of their original goal, they now have a project funded.

So, failing to meet a target just needs re-evaluation. Maybe the marketing pitch isn’t right. Maybe the goal is too high. Maybe the rewards aren’t good enough. Maybe the project just doesn’t fit with Kickstarter’s audience and you’d be better off with IndieGoGo or a co mpletely different funding model. Whatever it is, you still probably have more opportunity for new ideas than you would with simply going to a record label, major studio or high street bank – and the potential for direct feedback as to what you can do differently if you don’t win first time round.

out_of_the_blue says:

PROOF that indie films learn from Hollywood:

“LONDON (AP) — The clue was in the title.

In some ways “A Landscape of Lies” was a typical indie film, with a tiny budget, a B-list cast and an award from an American film festival.

What made it special is that it was created solely to cover up a huge tax fraud.”

SO fanboys, this anomaly PROVES that ALL indie films are scams like Hollywood! — In the same way as your pet anomalies prove that Hollywood is doing it all wrong!

PaulT (profile) says:

Re: PROOF that indie films learn from Hollywood:



Carry on learning English, you might notice that there’s a very important difference between these two words. Then consider the scales and amounts involved. Then consider the fact that these people were prosecuted, yet those you worship are still unpunished. There’s many, many differences, but you’re too dumb to notice.

At least you were too busy masturbating out this comment that you forgot your idiot signature.

cubrman says:

Well, I read that when Will Wright explained an idea behind Sims to test audience they unanimously voted down the game as an uninteresting one. Cus, srsly, you take care of a person, who must eat, dress, go to toilet and work? Boring! Such a project could have been a complete failure on Kickstarter :))))). Thanks God Will Wright could see through those opinions.
The article and the comment clearly have a point there, but the fact of the matter is that you can be sure about a project failing judging from such “test audience” ONLY when a project is something ordinary, well-understood and well-defined. Once you wonder even a little bit into some inventive never-used-before designs, you can never be certain.

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