Services

Is Kickstarter Scraping the Bottom of the Barrel?

Kickstarter was set up as a means for small creative projects to raise money. If the odds that measure the success rate of new businesses holds true with these projects, most will not make it a year. This may be the case with some of the odd projects online to raise money now. Sources of income cannot trump good ideas and execution.

The current “Staff Pick” on Kickstarter is a wood pen business. The pens have a special attraction because they are made from reclaimed whiskey barrels. It may help the project that the source of the wood comes from Jack Daniel’s barrels. The pen company says Jack Daniel’s is the best-selling whiskey in the world.

The wood pen company is up against a group of other firms that sell Jack Daniel’s merchandise, from shirts to belt buckles to coffee, and even pencils. So, whiskey barrel pens have an extraordinary amount of competition. Perhaps that competition has better e-commerce paying and shipping, better marketing and better funding. Who knows?

Among Kickstarter’s weaknesses is that it does not have enough people to critique business plans, if it was even inclined to. Critiques might drive away the people who fund new projects via its website. The pen project has 92 backers who have agreed to invest $3,473. Among the benefits of putting money into whiskey barrel pens from Whidden’s Wood Shop are key chains and pens made by the company. That has to eat into profits because the free products have some cost to make.

Kickstarter says since it was founded in 2009 it has helped entrepreneurs raise $1.5 billion for 78,000 projects with money from 8 million pledges. Among all that pitching of new projects and investing, where is the record of how these projects have done? Probably nowhere. But Kickstarter is not about project success, at least as far as an outsider could see.

ALSO READ: The Easiest (and Hardest) Jobs to Keep