I just submitted a new campaign to Kickstarter where I ask backers to prove me wrong. The larger story is that I think the new Orison Power System Kickstarter is destined to crash and burn like way too many others have. My campaign is an experiment to see if anything can be done before everyone looses. My past efforts to intervene in crash and burn crowdfunded tech have been painfully ineffective, so I will keep trying new stuff until I get it right!
The majority of crowd-funded product projects I’ve backed fail in predictable and preventable ways…
- Ready, set, fail.
They have everything ready to go for mass production with manufacturing and shipping partners. Once the campaign closes, manufacturer goes out of business taking lots of the money with them. They can not find new manufacturing partner because product really can not be made and shipped at the promised price point. Backers get back pennies on the dollar.
- Too Much of a Good Thing.
Real product and they know they can make 20 in the basement in a couple of weeks, but end up with 1,000 orders and no experience on how to ramp up. In the post campaign euphoria, they quickly waste most of the money frantically and inefficiently ordering materials and equipment. Years later the orders are still being filled slowly and sporadically.
- Seemed like a good idea.
Had built prototypes and all the remaining issues seem trivial. They aren’t. In the weeks following the campaign, they start trying to put together a final shippable product and find blocking problems at every turn. There is a reason no one ever made this product before – and it is not because no one ever had the idea. They end up shipping basically a box of parts that can not be realistically made into the promised product.
- Someone else thought of it first.
As soon as campaign closes, they get served with a patent cease and desist. The money is spent on lawyers.
There is no real product – just a few paragraphs of text that sound superficially like a great idea. They take the money and run.
The root cause of all these failures is misplaced incentives. Founders get all the money up front, and so have absolutely no incentives to plan correctly, execute quickly or efficiently, or satisfy backers1.
These could all be mitigated or prevented by proper project management. I’d call it something like “KickStarter On Track” and it would be an opt-in feature.
Every KickStarter On Track project would additionally have a list of specific milestones, each with a date and a disbursement amount and recipient. The very last milestone would always be “Backers agree that project is complete”, and the disbursement would be any remaining balance to the project creators.
Some examples of milestones might be…
|1/20/2014||Tooling and setup fees||$1,000||Fei Wu Tap and Die|
|3/15/2014||Raw materials for 1st run||$4,500||Sunny Day Plastic Corp|
|4/12/2014||Packaging and Shipping||$1,200||Boss Fulfillment LTD|
Practical benefits of the On Track system:
- founders do not see any money until backers are satisfied. You can still have project failures, but now the incentives are in the right places.
- when projects fail, they fail quickly and predictably (at least compared to the infinitely long failure arc of the current system)
- residual funds are available for an orderly refund process at each possible failure point
But I think the real benefit of the system is that is requires people to actually think concretely about these steps rather than just imagining their end goals. This can make all the difference.
Working World is a micro-lending non-profit. While they do provide money like lots of micro-lenders around these days, Working World is different. The money is ancillary to their mission. The real value they provide is project management. When a borrower shows up and asks for $500 to buy a new printing press, they ask stuff like…
- When are you going to make your first payment?
- Where will you get the money for that payment?
- Do you have customers for these products?
- How long will it take you to print these products once you get the press?
- Do you know how to operate the press?
- Do you have ink?
- Where will you get money to buy the ink?
- Where will you get money to fix the printer when it breaks?
They don’t know anything about the printing press business, but often just asking the questions will completely change the outcome of the loan. By nailing people down to common sense specifics (“If it will take you 1 month to complete your first order, you can’t make your 1st payment in 2 weeks”), they end up making much more realistic loans and have fantastic repayment rates.
Why would KickStarter do this?
Eventually people like me are going to get tiered of funding failed projects.When that happens, the party is over.
This could also help KickStarter differentiate themselves from other crowd funding sites and offer a high value, low risk experience to backers.
Finally, they could charge an overhead management fee that would be an additional revenue stream.
Why would a founder do this?
The obvious reason is that it will make the campaign more attractive to backers. Less obvious is that (I think) most founders are well intentioned and they want their projects to come to a happy completion. Hopefully they will welcome any help they can get.
Who would decide a Milestone has been reached?
The crowd-ish way would be to to have backers vote on it. Want the backers to approve your “completed molds” step? Invite them to a meeting where you let them touch them. When 30 backers tweet and Instigram about how awesome the molds came out, the rest will happily agree. This crowd auditing system is very hard to cheat and leverages the best of crowd wisdom. You’d want to build a nice site to make all this interaction easy, but KickStarter needs this anyway.
Any time a milestone date expires, the default action would be to refund the balance of funds to backers. Backers could also consent to extending deadlines if the founders could convince them to.
Couldn’t you do do this as an external site not affiliated with KickStarter?
Sure! You would need to get people to trusty you – which you could maybe do if you are already an established project management entity.
KickEnder.com would be a great domain- alias, it is taken.
Let me know when you get it up and running!
1 Ok, they may have some non-financial incentives like being good people, and having good intentions, and wanting to reserve their reputation so they can successfully fund future campaigns. In practice, these non-financial incentives do not seem help much once the campaign is over and the money is gone.
Indiegogo is a site that lets you give money to people. It is not a site that lets you buy things from people. There is a big difference.
According to their Terms Of Service….
All Contributions are non-refundable by Indiegogo and are made in your sole discretion and at your sole risk based on your sole determination and evaluation of the Campaign. You are solely responsible for determining the tax deductibility of any Contribution.
Indiegogo does not represent, warrant or guarantee:
- Perks will be delivered;
- Perks will be satisfactory to you; or
- The use of any Contributions or the outcome of any Campaign. It is up to you, as the Contributor, to ask such questions and undertake such due diligence as you deem necessary before you make a Contribution. Indiegogo may, in its sole discretion and judgment but is under no obligation to, seek the refund of Contributions.
This means that you should not expect to get your money back from IndieGogo if the campaign takes the money and runs. If you don’t get the perk you were promised, it is up to you to try to sue the Campaign Owner.
This is fine if the campaign is to buy a bus ticket for your best friend’s grandma, and the perk is that she will bake you some cookies. This not fine if you think you are buying an $800 high tech product from someone who lives on the other side of the planet.
I am all for Indiegogo’s “let the people decide who to trust, we just facilitate” strategy. They are like the Criagslist to KickStarter’s curated eBay. I love both Craigslist and eBay, and there is a role for both models. Criagslist goes out of its way to make it very clear that they are only an open listing service and that you are dealing with whoever posted the listing, so beware. Indeogogo does not.
The Indiegogo site is filled with the language and iconography of a product sale. The various “perks” are listed as products with prices and estimated delivery dates just like you’d see on Amazon.com or Gap.com. They even show a “2 of 10 left” inventory – implying that 10 of the perk actually ever existed in the first place. When the inventory of a perk is gone, it is labeled with the words “SOLD OUT”. What was sold here?
Come on guys, this is clearly designed to look like you are buying something and not just giving your money to someone. And the users are clearly fooled. Taking a look at the comments, people say stuff like…
- How does one change from a purchase of the $99.00 25 watt system to the $239.00 100 watt system?
- Missed out on the 1kW deal – is there any chance that you will extend it? Would really like to have purchased 4 units.
- I seperately ordered 2 × 500W panels and one 25W panel. I added the 70 USD shipping for the 2 500W panels to the payment of the 25W panel as I forgot before. Hope that’s ok. Looking forward to the product!
- So if I buy one of the 500w, all I have to do is “plug n play”?
The comments speak for themselves – these people believe that they are buying a product, and understandably so.
And while IndieGogo does talk about the democratic nature of crowd funding and the need for you to ask questions and make your own decisions, you are not allowed to post a question until *after* you’ve committed to give your money. That would be ok, except for the fact that once you have committed your money so you can publicly ask your question, there is no way to then cancel your commitment if you don’t like the answer you get! Kafka! This is not compatible with helping the crowd generate and share information so people make informed decisions, and I can not think of any good business or strategic or legal reason why you would stop people from canceling a contribution any time while the campaign is still running. Can you?
Indiegogo needs to get their act together. At very least make it so people can ask public questions before committing money. And then make it so people can cancel a contribution when they find out something that sours them on it. Then change the user interface so it is clear that you are giving money and not buying something. The only action button on a campaign page should be “I want to give money to this campaign!” rather than a product selection rubric. The next page can show the “perks”, but with plenty of disclaimer language like “These are some things the campaign may be able to send you as a thank you for your contribution, but IndieGogo makes no representations as to the campaign’s ability to actually deliver these goods, and your only recourse if you are unhappy to try to sue [insert campaign lister’s name here] directly.”
Not sexy, but at least honest.
Every couple of years another plug-in grid tie system is announced with much fanfare (like here and here), and inevitably it ends up being either (best case) overly optimistic vaporware or (worst case) a fraudulent scam.
I do not know what you will get if you order this item, but I do know that you will not get a 500 watt grid-tie solar system that plugs into an outlet. No way.
First off, I can almost guarantee that no matter what you get, it will not include a 500 watt solar panel. I’ve bought a lot of solar panels – large and small – and I’ve been tracking the various sizes and types for the past 10 years, and there is no such thing as a 500 watt solar panel. There is a good reason for this – a 500 watt solar panel would be so large (about 50 square feet) that you would have to ship it (extremely carefully!) by freight truck which would probably cost as much as the panel itself. So maybe they meant they would send you two 250 watt panels…
The best case scenario is that you will get a Solar-in-Box clone. This seems very unlikely since I have never heard from the Solar Liberator people, and based on their Indiegogo site they do not seem to have a deep understanding about how this stuff actually works.
Maybe a box with a solar panel, a charge controller, and AC charging adapter, a battery, and an inverter tossed in. There are lots of these system currently available, so if this is what you want then just buy it on Amazon today and do not risk giving your $700 to Solar Liberator.
Most likely you will just wait a very long time to find out that there are all kinds of unforeseen design and production problems and you will end up getting nothing (or at least nothing like what you were promised).
How do I know this? There are lots and lots of signals I can point to looking at the pitch page, but the one I want to highlight here is simple – you can not make a safe residential plug in grid-tie system.
If one of the circuits in your house starts drawing more power than the wires on that circuit can safely handle, the breaker (or fuse) turns off the circuit before anything gets hot enough to start a fire….
If you add a solar system that feeds power into an outlet on that circuit, you prevent the breaker from seeing and sensing the overload and cutting power. Now the wires are carrying more current than they can safely handle so they get hot and can start a fire.
What if I make sure that I never plug anything into that circuit except for the solar panel?
That could technically work because it would be the electrical equivalent of a dedicated circuit, but do you know which outlets in your house are on the same circuit? Are you sure? Even if you do, can you absolutely guarantee that no one will plug something else into the other outlets? For the next 20 years?
This is is why the National Electric Code (and every local code I know of) require a dedicated breaker for any back-feed power source. (This means that even if they did make the described product that it could not be eligible for the Residential Renewable Energy Tax Credit.) I am no lover of codes, but this one does make sense.
That is why the design of Solar-in-a-Box is special. It never back feeds into the house wiring, and so all conductors are always protected from overload.
What if I derate the circuit and install a breaker that is smaller to account for the additional power generated by the solar backfeed?
You could do this, but opening up a service panel and swapping out breakers is not a plug-and-play job. If you are willing to open your panel, you can just install a dedicated circuit for a proper (and legal) solar backfeed.
What is the take away message?
If you ordered the Solar Liberator 500W system on Indegogo, you should try to cancel your order and get your money back.
Is there any good news?
The good news is that success of this campaign proves that there is market demand for a plug-in solar system. Maybe it is finally time for someone to mass produce Solar-in-a-Box?
If Solar in a Box is such a good product, why ISN’T it marketing itself through crowd-funding? (new)
I do not have the time or skills to manufacture, distribute, and market it. I’ve instead done everything I can to make it easy for someone who does have the time and the skills to do it. I’ve explicitly not patented anything about it. If you want to mass produce a Solar-In-The-Box design, the only payment I request is the right to purchase the first one off the line!
Its easy to be cynical, but advances are made all the time, and a 500w panel in is not that farfetched, especially with the stepped up R&D and production from China. (new)
According to the dimensions on the campaign page, the 500W panel would be 102”x52”x2.7”. That is 8.5 feet by 4.3 feet. Think about how big that is. Have you ever tried to carry a full sheet of drywall? Well, this solar panel would be bigger than that.
It is also 102” of length and 109” of girth. It would not be shippable by any standard carrier in the USA (USPS, FedEX, or UPS). Shipping problems aside, you would never want to make one that big anyway because it would be extremely large, fragile, and heavy.
You could easily ship two 250W panels for the same effect, but they make it clear though text and photos that this is not what they are offering. This is a very silly issue. To me, it indicates that, at the very least, they have not thought though the simplest practical details of actually manufacturing and distributing such a system.
I believe the reason the campaign has been so successful is that their answers feel authenticate and verifiable, and the technology seems viable, and the team has that feeling of dedication and fervor we all want to believe in. (new)
I agree – unfortunately there is a big difference between feeling authentic and seeming viable and actually being authentic and being viable. Actually making things like this takes a lot of work and effort and research – good sounding marking is not enough. It is not good enough to seem viable when you are taking
If there’s a short, the breaker will still trip. (new)
Depends on the short. Most household fires are not caused by zero ohm busbar shorts. Most fires are caused by stuff like a nicked high gauge wire (closing a door on your x-mas tree light cord) or a loose conductor inside an appliance or junction box. Have you personally ever blown a breaker? If so, I bet it was not a zero ohm short – probably a 20-50 amp overload.
But that is not the problem I’d be most worried about – I think the more likely scenario is that someone plugs in a space heater while someone else is blow-drying their hair. Have you ever blown a breaker in a situation like this? If you had a Solar Liberator or that breaker might not have blown, and you could have had a fire inside your wall instead.
In your example, I could determine which circuit the panel is plugged into and replace the breaker with one with a lower rating. (new)
First off, this would involve opening the service panel. This is not the plug-and-play solution promised and is probably illegal for many people (or at least requires a permit). Plus, if you are willing and able to crack your service panel, then you mind as well just install a proper and legal direct backfeed circuit and save all this hassle.
More importantly, this is a not real world solution since you would need some way make sure that the plug coming from the solar system could only ever get plugged into a derated circuit. That would mean inventing a brand new kind of plug for the solar system that would be rejected by a normal receptacle. You’d need to get this new plug type listed and manufactured and added to every electrical code in the county. Now you’d need to install this new kind of receptacle on the drated circuit. Essentially you are talking about effectively creating a dedicated circuit- just doing it a harder and impractical way. Again, this is not a plug-and-play solution and ends up being harder than just dropping a proper dedicated backfeed.
Keep in mind that codes and listings are all about making products failsafe in normal use case by people who do not know the codes. A 20A plug is designed so that it physically can not fit into a 15A receptacle because that could cause an overload. A standard prong plug means “the thing that is connected to this plug only draws power”. You cannot get UL listing for any device that who’s safety depends on people never accidentally plugging a normal plug into a normal socket.
Also, the Solar Liberator says you can daisy chain up to 4 panels of 500 watts each. That’s a peak current of 16 amps. What this means is that you are going to overload a standard household NEMA 1-15 or 5-15 outlet BY DEFAULT just by plugging in on a sunny day. I know that you are then going to say that you could put a NEMA 1-20 plug on the solar thing. This is not what is shown in their pictures or mentioned in the text (“For grid-tie- Just plug into a wall socket!”) – clearly not something they even thought about.
What is your technical expertise/background, if you dont mind my asking? i am not trying to be snarky here (new)
I own a 10 acre, 25kw grid tie solar farm (huge at the time is was commissioned), I was amazed at how hard and expensive the process to install it was. My first thought was to make a plug-in grid-tie system like what Solar Liberator claims to be, but after doing a little research I discovered that it is impossible to make a safe and legal plug-in grid tie system. This means that the Solar Liberator founders either (1) did not do even cursory research or prototyping before listing the product they claim to be able to make, or (2) they know it is not possible and have no intention of ever producing it. Either way the people who are contributing to them will like likely be disappointed with the outcome.