As you may know, my writing background started in a very different field. I used to be in “development,” which is a coy way of saying “fundraising.” I wrote a lot of grants in my years in that field. Some were for things like paying salaries, keeping the lights on and making sure toilet paper was in the bathrooms. These are called “general operating support” requests and don’t fund anything specific. The term for support sought for art exhibits, professional development programs and other focused projects with concrete deliverables is “project” or “program” funding. If crowd-funding vehicles resemble traditional American fundraising in any way, it’s in similarity to the latter concept.

The modern day patronage model that Kickstarter advocates has been perilous, and just like with grant funding, there is no guarantee that the projects are going to be executed exactly as prescribed in a pitch. The big difference though, is that nonprofit organizations seeking institutional support usually (but not always) have an infrastructure in place that provides a reasonable measure of confidence. In fact, in most calls for proposals, you’ll find a request for applicants to detail worst-case scenarios. Planning for a series of unfortunate events up front makes reacting to them far easier.

In an effort to quell any misunderstanding or willful self-delusion about the risky nature of crowd-funding, and force project managers to plan for the worst, Kickstarter has posted a new entry on their blog that starts with this ominous statement,

“Kickstarter is not a store.”

Two major changes follow that the group hopes will improve the way project managers and backers work together. The first new requirement will have every project pitch include a section that details risks and challenges and steps that will be taken to overcome them. As a former grantmaker, I wholeheartedly endorse this inclusion. The responses will reveal many things about project managers and their ability to consider possible speed bumps (or road blocks). More importantly, it will give potential backers a good sense about how in touch a creator is with reality. In my experience, that can range between “grounded” and “what the heck are you smoking?”

The other major alteration to Kickstarter’s guidelines is a new requirement for hardware-based projects and product design pitches. No longer will simulations be allowed, which means I don’t think my project entitled, “No, really. My Jetpack will work just like this!” is going to get approved. Additionally, renderings will no longer be allowed. A working prototype will need to be done and showcased. Furthermore, multiple units can no longer be offered as rewards, because Kickstarter believes this helps create the appearance of purchasing a finished, package good.

Two projects come to mind that may have inspired these changes. First is the Pebble E-Paper Watch. While the pitch video clearly demonstrates a prototype, the project has met with delays that have left backers demanding more and better communication. Things have been mismanaged, with the developers asking for users to select the color(s) for their backer reward units without even showing them samples. Starting at the $220 tier, backers could get two or more units in their incentive packages, and both were supposed to be delivered this month. At this point there is no concrete shipping date, and I would hate to be the person that convinced nine friends to go in on a $1,000 contribution.

The other project hits a little closer to home. The Ouya pitch video is a slick piece of filmmaking. While a prototype is mentioned, and there is one reel of screens on a television shown a couple of times (that could just as easily be a short animation rather than interactive programming), the device itself is never shown. All of the images on the project page are renders. The first manufactured prototype hasn’t been created as of the most recent update on September 14, but take heart. They’ll be testing “design assumptions” soon. That doesn’t exactly inspire a lot of confidence.

Will the changes to the Kickstarter guidelines make it harder for legitimate projects to get funding? No, I don’t think so. However, it will force managers to front-load more work before asking the community to back them. This will also mean more up-front expenditure. However, with some smart budgeting (and a product that people want), that money can get paid back. The end result is a level of confidence that backers don’t have right now.

Will this make every project a winner, even after it’s funded? There are no guarantees, no. However, it will widen the gulf between backers and people looking to scam them or those that simply have big ideas and no real way of making them come true.

via[GamesIndustry]