Have you ever thought about getting your project funded? A recent Kickstarter study says, there is a possibility that your project may just not work out.
Ethan Mollick, a scholar from the Wharton School of the University of Pennsylvania helped to co-published an independent report, surveying 500,00 backers.
A “failed project” meant that the project met its financial goals, but did not offer the backers with of its earned rewards, or even finish their own project they had started.
Some interesting findings from the study:
- failed projects provided a refund only 13 percent of the time
- 9% of the backers did not “make good” on the rewards
- 13% of backers gave refunds most of the time
- 7% of backers never got their chosen reward
Kickstarter commissioned and co-published the study, despite saying it had “no influence over its findings.” Yet, Mollick’s conclusion should make Kickstarter very happy. He said “there does not seem to be a systematic problem associated with failure (or fraud) on Kickstarter, and the majority of projects do seem to deliver.”
Kickstarter stated that they find these numbers tolerable. “Is a 9 percent failure rate reasonable for a community of people trying to bring creative projects to life? We think so, but we also understand that the risk of failure may deter some people from participating,” Kickstarter said. “We respect that. We want everyone to understand exactly how Kickstarter works — that it’s not a store, and that amid creativity and innovation there is risk and failure.”
Regardless of the numbers, 1 out of 10 failures is nothing to be pleased about. Kickstarter did say that the majority of the projects do succeed, it was those under $1000 that failed the most, around 10 and 15 percent.