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Comment by ChuckMcM | Hacker News Reader

I found this a reasonably well balanced discussion of the challenges facing Kickstarter type projects. To some extent the TLDR is "making things is a lot more complicated than people realize" but that merely points out the challenge between innovation and production.

I think Kickstarter gave a 'voice' to the market for new products that didn't exist before. Here people vote on new ideas with money, something any marketing manager can understand. And unlike Quirky people don't have to give up all rights to their product to a manufacturing partner.

So perhaps there is another company here, "KickDoer" which is the 21st century equivalent of FlexTronics or FoxConn.

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Another problem I seem to always see is: "We had this problem in China with <insert problem here> ..."

People. Do the first 1,000,000 units HERE. Where HERE is the country you are located. If you can't make a profit that way, going to China doesn't magically fix that. I have yet to see a Kickstarter that actually had to go to China to be manufactured.

After 1,000,000 units, you have enough knowledge about manufacturing your product that you might be able to handle the switchover to China and not get killed.

And, if you aren't delivering 1,000,000 units, you shouldn't be going to China anyway.

Heck, even trying to manufacture ten units locally would benefit every project creator. While there are plenty of ideological arguments for local manufacturing, the strongest arguments are purely practical: faster iterations, clearer communications, better quality control, and a more visceral understanding of the inevitable problems (and solutions) that arise when making a physical product. These benefits will make the future transition, if any, to overseas manufacturing that much smoother. For all these reasons, we encourage local manufacturing at Crowd Supply, which I think plays a big part in why 100% of our funded projects have either already delivered or are on track to do so.

I really think the only failure of kickstarter is that many backers don't understand the risk they're buying into.

R&D always costs more than production, so wouldn't backers in theory pay more than market value to be first and part of the creation cycle?

I disagree R&D is usually a faction of the cost needed to go into production. The large the number of units, the greater that ratio is. For mass produced products it can be 10:1. Consider if you're going to ship 10,000 of something that costs $25 to produce. You need a $250,000 just for inventory. You need a way to assemble, test, and ship the product. Deal with 10,000 customers.

Designing the production flow, jigs and fixtures, quality control, training up people, all requires money and engineering time. The business and sales side of things requires time and money.

I've seen numbers of products stall out because the developers fail to get enough funding to go into production. Also in a lot of cases markets move slowly. You can introduce a product and the buyers will just nibble for the first year or two if you're not an established name. Your company has to be able to keep the lights on during that time.

The idea is usually that the project team either has already done the R&D and they're just raising money for the production run, or that they're going to do the R&D for free because they're going to own the business and make a profit on every sale after the backers get the initial production run.

Both wildly naive it seems, but I suspect that's how people imagine it. The demo videos usually show a "done-ish" product and downplay how much more needs to be done to actually ship it. And they always talk about how strong their team is and how it's totally doable even though it's not done yet.

The wifi lightbulb people come to mind. Total smoke and mirrors demo video and it took a major multinational getting involved to actually ship the product. That's the Belkin WeMo.

Part of the appeal of a product on kickstarter is the marketing which has way more appeal than just the actual product does itself.

It's the "trust us" attitude and the generally soft spoken videos and collateral doing exactly what marketing is supposed to do. In other words it all seems so genuine, possible and down to earth in tone and builds up a trust factor. Even though the people behind the product are complete unknowns. Take away those videos and there would be a drastic drop in funding and not just because the videos explain features or benefits either or can go viral.

There is a company like this: https://www.crowdsupply.com

Disclaimer: I'm the CEO/co-founder of Crowd Supply. Happy to answer any questions.

Wow Lou Doctor is on your team I remember him from Supermac back in the early 90's.

The very same!

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