Projects on Kickstarter site collect millions for dreams
by Peter Svensson, Associated Press
August 17, 2012 10:17 PM | 422 views | 0 0 comments | 3 3 recommendations | email to a friend | print
Pebble Technology founder Eric Migicovsky is wearing the Pebble watch in New York. In April, three-person startup Pebble Technology sought to raise $100,000 to make the programmable wristwatch. Donors on Kickstarter showered them with more than a hundred times that amount: $10.3 million. Kickstarter is at the center of a new phenomenon known as “crowdfunding” in which donors contribute small portions of money to get a project off the ground.
Pebble Technology founder Eric Migicovsky is wearing the Pebble watch in New York. In April, three-person startup Pebble Technology sought to raise $100,000 to make the programmable wristwatch. Donors on Kickstarter showered them with more than a hundred times that amount: $10.3 million. Kickstarter is at the center of a new phenomenon known as “crowdfunding” in which donors contribute small portions of money to get a project off the ground.
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NEW YORK — A funny thing happens on Kickstarter, the website where people ask for money to finance their projects. Sometimes, they get more money than they ask for.

Sometimes, they get millions more.

In April, three-person startup Pebble Technology sought to raise $100,000 to make 1,000 wristwatches that can be programmed with different clock faces. Donors on Kickstarter showered them with more than 100 times that amount: $10.3 million. It would have gone higher had Pebble not put a cap on contributions and ended the fundraising early.

“We had tried raising money through the normal routes, and it didn’t really work,” said Eric Migicovsky, the 25-year-old founder of Pebble.

Kickstarter is the largest of dozens of sites devoted to crowdfunding, in which donors contribute small sums of money to get a project off the ground.

Inventors, artists and entrepreneurs post their projects on a Kickstarter page, usually with a video presentation. They set a fixed duration for their fundraising, from one to 60 days, and a dollar goal for contributions. Anyone can contribute. If the goal isn’t reached by the deadline, no money changes hands and the project is canceled.

Usually, the contributors get something beyond the satisfaction of knowing they helped turn a dream into reality — like a ticket to a theater production, or in the case of Pebble, a programmable watch.

Designer Casey Hopkins asked for $75,000 to make a luxury iPhone dock out of solid aluminum. He got $1.4 million. When that happened, in February, his was the first Kickstarter project to surpass $1 million. There have been eight more since then. Artist Rich Burlew asked for $57,750 to put his comic books back in print, and ended up with $1.3 million.

Since launching in 2009, Kickstarter has raised $323 million for projects. Starting a project is free, but Kickstarter takes 5 percent of contributions if a project is funded, and Amazon.com Inc. takes another 3 to 5 percent for processing the payments. The funds are usually subject to taxes as well.
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