

Will Crowdfunding Crowd Out Venture Capital - somid3
http://www.readwriteweb.com/start/2012/05/will-crowdfunding-crowd-out-venture-capital.php

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roycyang
My main concern with crowdfunding is the level of protecting the _crowd_ gets.
Assuming that startups and founders do align their interests with the crowd,
how and where does the crowd get to help guide the direction of the company?

What mechanisms are in place to keep the founders honest? I've seen many
success stories on Kickstarter, are there any widely known failures?

~~~
DanBC
There are some things that took a weirdly long time to happen. The pen and the
torch are examples, but both are now shipping.

([http://www.kickstarter.com/projects/527051507/hexbright-
an-o...](http://www.kickstarter.com/projects/527051507/hexbright-an-open-
source-light))

([http://www.kickstarter.com/projects/cwandt/pen-type-a-a-
mini...](http://www.kickstarter.com/projects/cwandt/pen-type-a-a-minimal-pen))

There's the lockpicks, which I think are still in trouble:

([http://www.kickstarter.com/projects/schuyler/lockpicks-by-
op...](http://www.kickstarter.com/projects/schuyler/lockpicks-by-open-
locksport/))

These don't show people wilfully defrauding funders. I think they show people
being overwhelmed by demand, and unprepared for the problems of manufacturing
hardware.

Design for manufacture is interesting and has many small tricky gotchas. Add
in bizarre export rules and foreign languages and it's not surprising that
hardware manufacture is difficult.

