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Summary:

Kickstarter is not just a startup– it’s part of an important shift away from the industrial manufacturing era & toward the maker economy. In this wide-ranging interview, founder Perry Chen talks about how society is reaching a new ‘bursting point of creativity,’ & where Kickstarter goes from here.

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We are on the cusp of a big economic shift. I believe that the industrial era is coming to an end and Kickstarter just might be the most visible representation of that. When I look at Kickstarter, I see small businesses that have been funded by their customers. I see the acceleration of this shift away from the industrial manufacturing ideology to more of a maker economy. And I also see an idea so powerful that the company name has become a verb.

Take the Pebble Watch as an example. It was an idea that was rejected by institutional investors but embraced by actual buyers via Kickstarter. Without broadband-enabled connectivity and Kickstarter, this watch that has now raised upwards of $10 million from over 85,000 people would have not happened. I wouldn’t be surprised to see more of these projects that upend the whole established manufacturing ecosystem.

Kickstarter has received $100 million in pledges over the last year and has had a number of projects exceed the million-dollar-pledge mark this year for the first time. And now, Kickstarter is up to 23,000 successfully funded projects and more than 2 million backers. To date, more than $230 million has been pledged to projects. Movies, music, city designs, watches, video games — Kickstarter has become an epicenter of creativity. It is funding everything from a pickle factory in Chicago that uses Bloody Mary marinade and wants to expand, to a live music-and-film series that would play in parks around Harlem.

With Kickstarter, creators list a project, a funding goal, a deadline and a way to reward backers who pledge money to the project. The project is only greenlit if it reaches its funding goal, though there is no limit to how much a project can raise. Kickstarter makes its money by taking a 5 percent fee from a successful project’s funding total. (The company has raised $10 million in venture backing from Union Square Ventures, Betaworks, Jack Dorsey, Vimeo co-founder Zach Klein, Flickr co-founder Caterina Fake and many other angel investors.)

When I see Kickstarter  I don’t see a company. Instead, I see a social movement. I see people doing things for people. I think of Kickstarter as a reflection of me, which is why I engage with it. When Kickstarter turned three years old, Perry Chen, the startup’s 35-year-old co-creator, wrote a post about the company on his blog and that was enough of a reason for me to ping him and see if he wanted to sit down for an interview. We had met about three years earlier at a coffee shop near Union Square in Manhattan, but we clearly had a lot to catch up on.

So earlier this month, I sat down with Chen, (who in past life co-founded the Southfirst gallery in Brooklyn and worked as a musician/audio engineer in New Orleans,) in his offices on the Lower East Side for a marathon two-and-a-half-hour session. I have managed to boil it all down to about 3,500 words. It may seem long, but Kickstarter is that important of an idea. Why? Because just as we Google things and we tweet — we kickstart!

  1. The story so far
  2. Is Kickstarter a symbol of a society transforming?
  3. And where does it go next.

An idea, Kickstarted

Om:  You and I met for the first time over three years ago, when Kickstarter was still a nebulous idea. Have the past three years surprised you?

Perry:   At its core, Kickstarter is a very simple idea. We believed that if we could just get it out there into the world, and get people to use it, that their success would beget more success, and more attention. With thousands and thousands of projects on the site at any one time, and over 20,000 successful projects — I think, in many ways, this is exactly what we hoped.

We knew if people embraced it, it would grow and be used in this way. But I don’t think we knew what success felt like.  We knew that the idea was big.  The visceral part of it is something that we’re only knowing by experiencing it, but I think from the perspective of just, “Is this what we thought it could do?” Certainly.

Om:  When you started this, did you ever think of it as a company or did you think of it as a social movement?

Perry:  It was an idea. It’s funny. I remember early on, people tried to associate us with ‘This is a social good thing that you’re doing,’ and I almost bristled. I was like, “What do you…?” because that’s not how I thought about it.

Now, I’m thrilled that our mission is a socially good mission, but that’s not where it came from. It just came from this feeling that there was this need for creative people to raise money for their projects.  And this was really an efficient way to do it. There were a lot of other beneficial effects, like the building of a community around an idea and the connection of people to an idea in a very, very different way than as consumers.

Om:  Had you been thinking about this idea for a long time?

Perry:  The original idea came to me in, I think it was late ’01 or early ’02. I wasn’t in the position where I wanted to start a company or, honestly, really knew how to do it, especially in the web space, because I didn’t come from the web. I was living in New Orleans and thinking about continuing to work on music.

I had the idea, and then I was like, “That’s a good idea. Now, back to my regularly scheduled life.” I did expect that, in six months or one year or two years, I was just going to turn on the TV or go on the web one day and somebody was going to send me a link and be like, “Oh, check this thing out,” and I would be like everybody else, “Oh, I had that idea.”

Om:  We all have different interpretations of Kickstarter, but what is the essence of Kickstarter in your mind?

Perry:  We would like it to be a fundamental tool for the liberation or the acceleration of our own creativity. I think that, when we’re younger ‑ whatever that means ‑ we have ideas all the time. We embrace our ideas. We say,  ‘Oh, I’m going to do this. I’m going to throw this event with a friend. I’m going to have this play, this movie, this thing.’

You have not yet been taught the realities of life, that, “You can’t do that because of this and that or the other thing.” Very often, that other thing is money. Over time, because of the constraints, with money being the biggest one (or the most common one) we start to squash down our ideas.

We don’t have to squash down our ideas because of the harsh realities of the real world. From a very emotional level, that’s the dream.

I think, we’re able to offer people the ability to overcome that one core roadblock — the funding — and then additionally allow people to build this community and nurture an audience around a project.

Om:  Twitter had its Oprah moment, and everything changed for them. You think the Pebble Watch is your Oprah moment?

Perry:  Maybe in technology and design. Listen, it has been great, and publicity has been great. But we were (responsible for) 12 percent of the films in Sundance in January 2012. I think we get a little myopic in our world.

Om:  So there are many Oprah moments.

Perry:  If you remember the Double Fine project, that was massive. [Laughs]

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Does Kickstarter personify a society re-making itself?

Om:  What is your take on the emergence of this Internet-enabled creator/maker ecosystem?

Perry:  I feel like we’re used to this industrial creative complex of movie studios, record labels and production houses. It wasn’t always that way. This is relatively recent in human history. People have been creating art for tens of thousands of years. Artists have always been hustlers, too.

In general, artists have always been extremely creative people both in art and in talking to audiences, and in hustling to get the things that they want done, to get their ideas out of their brains and expressed.

A lot of the things that you’re seeing on the web now, from YouTube to Twitter, and what we’re doing, are really just the tools so that creative people can get their things done and connect with other people. They don’t create the creativity. They don’t  change the way creative people are.

Om:  So in a way we are going back to the old way of doing things, where instead of having rich patrons we have a lot of every-person patrons.

Perry:  There was this concept of subscription artist — a lot of 18th-century books were written this way.

Mozart, Beethoven had to raise money this way.  They would go out to subscribers and those subscribers would put in money and they would get a copy of the book with their name inscribed inside of it or a copy of the concerto, or a first look at the concert.

Yes, there’s a history of this in art, besides the patronage of the Medici or the church. There was this concept of the audience. Obviously, they didn’t have the web, the scalability of the web. The ability to do that is incredible.

Om: Given the traction Kickstarter has received,  I wonder if something bigger is going on at a societal level?

Perry:  We’re reaching this bursting point of creativity. People are embracing their own creativity more and more. It’s now OK to be an accountant during the day, but at night you’re a writer or you’re a painter or you’re a DJ. We don’t have to be one thing anymore.

Om: Does it have something to do with our ability to learn and create easily, thanks to the Internet?

Perry: It’s getting cheaper to make things. It’s getting cheaper, or free, to learn how to do things. It’s getting cheaper to distribute things and share them with people and get yourself out of that creative vacuum. Even if some kid out there in the middle of nowhere creates something, she can share it on the web with people, and get that feedback so she doesn’t feel like: “I’m just doing this and nobody can tell me what’s going on.”

You can do a lot of art and creative projects in digital form. To make an album now, it probably costs 10 times less  than it did 20 years ago. Even film being crazy expensive, is still coming down in cost.  And now, hopefully, we’re helping build the pieces that help the funding of it and building the community around that as well. That is an explosion point.

Om:  For awhile, I have had this theory that we, as a society, are coming to the end of the mass production, industrial phase of the human race. Instead, we have entered an Internet‑enabled phase, where the economy is not about being the biggest, but being able to do few things well, and then finding an aggregate audience for what seem to be small ideas and niches. A perfect example would be the Pebble Watch.

Perry:  Pebble Watch… not so small anymore.

Om:  In the grand scheme of things, it’s not really a big product. But it’s, like, $10 million.  What do you think about that?

Perry:  It shows a relatively obvious point: that not all the big ideas come down the mountain on a stone tablet by a major corporation. There are really creative people out there that are doing things on their own.

In terms of the small‑batch, artisanal market for everything, I think without a doubt we see it.  People want to know where their stuff comes from. I think people buy products, but they also buy experiences. People value experiences more than they value products.

When you buy local food, you’re buying both a story and a good. Also, you’re saying something about yourself and what you care about. I think that’s what you’re seeing more and more in the things that people are looking for. Often, the stuff costs a premium, and I think people are willing to pay it. It’s worth it to them.

Om:  Right now, big media companies make products, which we consume. It doesn’t matter whether it’s Facebook or Disney. They are all vying for our attention. Now, here is Kickstarter with, let’s say, 3,000 films today and about 5,000 music albums. Suddenly content that is not controlled by big media is now competing for our attention with the big-media productions.

Perry:  Yeah, any dent we can put into the machine we’re happy to do. I think we’re already seeing it. A lot of these things that are getting funded would not have been funded in any way. People are watching films that were made on Kickstarter and playing games that were made on Kickstarter. I think the big media companies are going to continue to have things that they’re going to keep making for the mass audiences, but we hope we’re eating away at the bad stuff.

Bad stuff gets made in the system. You get sequels. You get safe things. You get people with new ideas that don’t get funded. You get constrained funding so that one out of every thousand people can get a shot. You have systems that are based on who you know. That’s what we want to break apart. Good ideas can bubble up without these gatekeepers saying yes.

Om:  Right. I think the question or the point I was trying to make was that with the friction in the creative process going away, it’s getting harder to get people’s attention. I think Kickstarter is that platform of creativity.  I think the emotional appeal of a platform is what works. I think the old-media entities still have not figured out that part of the game plan.  I see Kickstarter as coming from left field, just like Twitter siphoned attention away from established media forms and in the process became a medium of its own.

Perry:  Well then, don’t give it away. Don’t, please. [laughs] We almost had them, and then you had to give them a heads-up, and the Murdochs are going to read this.

Om:  Do you really think of it as your company? Do you think of yourself as essentially the caretaker for the movement?

Perry:  It’s a lot of things. I definitely do think of Kickstarter as my baby. I’ve worked long and hard on it. I take a lot of pride in it. But I also certainly know it’s bigger than me. It’s the baby of the rest of the team, of course, and the project creators and the community. I think even before it became big, there was this moment where I just felt like I was the shepherd of the idea, not just the company but of the concept.

Regardless of company, this idea of funding projects in this way on the web is just here now.  We’re confident that we’re going to keep doing it right, but that’s secondary to the fact that the idea is now just in the world.

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What’s next for Kickstarter?

Om:  How many types of categories are on Kickstarter right now?

Perry:  [Laughs] There are 13.  I’m going to forget a few, but it’s film, music, art, photography, theater, design, technology, food and a few others.

We take a very liberal or what I think is a more modern view of what a creative project is. I mean, for us, a lot of food projects are definitely creative projects.  A lot of technology, maker/hacker projects are definitely creative projects. Video game projects are, for us, definitely creative projects.

Om: Are you adding new categories?

Perry:  We’re also looking at not just constraining but also expanding a little bit into urban design and things like bike lanes and bike racks and community gardens.  A lot of cities have approached us, talking to us about projects in that space. And we’re just having conversations — we don’t want to do anything too quickly.

We want to see how we can bring those projects in and bring them in in a way that fits Kickstarter — so they’re creative projects, with rewards and the right structure.  And even science, I mean, science is something that we’ve been talking about for awhile.

There’s already been science projects on the site that fit into other categories for some reason. But it’s really fascinating to us. Science is a hyper‑creative field, and there are a lot of things in science that we feel qualify as creative projects.

Om:  I’m addicted to Kickstarter. And the biggest challenge I have is finding the projects.

Perry:  We’re working on kind of the next generation of discovery and ways that we can help you find the projects you want faster.  Because the growth has been so great, we’ve shifted a lot of focus to other areas. And discovery hasn’t gotten as much love as we would have liked.

Om:  We have tablets and phones. Going beyond the obvious browser, do you think Kickstarter evolves and changes to keep up with that?

Perry:  We don’t have an iOS app. We don’t have a very mobile‑friendly version.  We don’t have an iPad app.  That’s all stuff we’re thinking about and we’re working on. I think it’s a battle between getting a lot of stuff done and staying small. I think we’re very committed to staying small.  We’re 37 and I know it’s not a lot of people when you talk about the web. But it’s a lot of people.

If we take a little bit longer to get stuff done, that’s what we’re going to do. We’ll work harder, but we don’t want to be hundreds of people. We want to keep the team small. We want everybody to know everybody else. We want to grow the company culture in that way.

Om:   As a platform, what are the things you think that you will need to provide for this thing to keep going? For example, security, fraud prevention, all those things.

Perry:  We believe in not just the audience to find the things that they want to fund, but also in the audience to help us police the site, help us see when things are going off. I don’t think in terms of a trust and safety perspective that the solution for us is to build a big team of people who investigate the validity of people’s claims. Like “Who are these people?”

We’re trying to move away from gatekeepers. I think you create a safer system, instead, by continuing to build tools to have the audience be out there and help us spot things. We’re going to keep doing a better and better job of that as we go on. We’ve got over 20,000 data points right now of successful projects. That’s really informing our thinking with the new things that we’re working on developing.

Om:  With the JOBS Act, there is a lot of talk about Kickstarter being used for crowd funding of startups, etc. What do you make of all that talk?

Perry:  Some people have made assumptions about what we would do. We’re not interested in that model.

We’re going to keep funding creative projects in the way we currently do it. We’re not gearing up for the equity wave if it comes. The real disruption is doing it without equity. The real disruption is when you break down the funding of a project into all these little bits.

When people are giving $5, $20, $50 — people don’t need to receive a return on their investment.  People are giving relatively affordable amounts of money and they decide how much they give.

So many ideas, in general, in the world are not about and are not going to make money. Those things need a model. That’s the world we come from. That’s what we wanted to support.

Om:  Where do you see Kickstarter going over the next three to five years?

Perry:  The past three months have been a whirlwind. We had never had a million‑dollar project before and then Double Fine was about three months ago. Now, we’ve had many million‑dollar projects and multi‑million‑dollar projects. But we honestly don’t really care if we have million‑dollar projects. We’re just interested in projects.

That said, those large projects draw attention. They draw new people to the site and they’re rallying points for people to find out more about the site. So we’re more known, more out there.

Om: Is that important?

Perry:  You start from being something that works really well and is cool. That’s what makes people want to use it. Then you ride that for a little bit, knock on wood. Then at some point this magical thing happens where you become a utility. You’re like Wikipedia. You’re like CraigsList. That’s really where we want to take this. We want people to understand very simply how Kickstarter works and how they can use it. It’s just a utility out there on the web.

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  1. Well said champ! You’re my hero :)

  2. crowdfundingstrategies Monday, May 28, 2012

    Reblogged this on crowdfundingstrategies and commented:
    A very well done interview.

  3. Yanik Silver Tuesday, June 5, 2012

    Kickstarter and other crowdfunding sites out there are one of the most powerful ways for an sort of producer to put an idea out there and see if the marketplace tells them they have a winner. It used to be spending months and tons of time developing a product to hope somebody will buy it. Now you see what ideas deserve your time and effort. Plus, there’s so much energy and motivation for the creators when they see their project starting to move towards their goal.

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