I've funded projects on Kickstarter a few times now, to varying degrees of success. Certainly, Kickstarter can serve as a valuable funding tool that can imbue projects with life when they lack other options. However, over the past few years, I've come to the realization that instances like these are in the minority, and that most applications of Kickstarter are neither necessary nor beneficial to the user. Let me explain.
The way I see it, Kickstarter projects can be classified into three categories depending on the amount of funding they're seeking: $5,000 & under, $5,001 to $50,000, and $50,000 & over. Within these ranges, projects tend to be similar in scope, and often in form and type. The first and third categories are the ones on which I'm going to focus today, for those are the ones that provide the least benefit and pose the greatest risk, and are the ones that make me most skeptical of Kickstarter.
First, let's look at category number one. These are projects seeking funding under $5,000, and tend to be durable goods and pieces of art that often easy to produce and are sold by a single person. Examples include stickers, posters, physical games, shirts, etc. In many cases, the bulk of the work on the product is complete, and the funding is necessary only for production and distribution of the product. In many cases, the campaign is used simply as a means of collecting pre-orders. In cases such as these, a Kickstarter campaign is totally superfluous. Kickstarter is not, nor should it be, a marketplace. It was intended as a way for the community to fund projects that traditional funding apparatuses couldn't or wouldn't fund. Many of these projects are not in need of funding, and merely want a means to sell products that have already been devised, designed and prepared for production. The user gains nothing in these scenarios, as the vendor could just have easily set up an online shop.
On top of this, the user incurs significant risk when funding these sorts of projects. In my experience, smaller projects of this sort tend to be the ones that most frequently fade into oblivion and defraud their customers. Of the four or so campaigns in this category that I've funded, three have taken my money and disappeared while several others have been significantly delayed. Based upon what I've read, the issue seems to be most prevalent with smaller projects. The fact that Kickstarter permits vendors to collect money from users months or even years before shipping products while not implementing any kind of enforcement gives a cover to people either intend to defraud customers or are simply too negligent to ship products on time, if at all. In most cases, these projects don't truly need funding, or are small enough in scope to realistically be put on the creator's credit card. As a result, backers of these projects don't receive any tangible benefits, but are exposed to considerable risk.
Next, lets analyze the third category: projects seeking $50,000 and up. These projects are often consumer software or hardware, and Kickstarter is often employed as an alternative to taking on traditional investors. Because these projects tend to be high-profile, they rarely just fade away with their customer's money. However, they tend to take on logistical nightmares by virtue of the fact that they require substantial development and production investment and often require thousands of backers. Whereas companies that seek venture funding can operate without much pressure before going to market, and can operate with a degree of freedom because they don't have many parties to appease. Companies on Kickstarter, on the other hand, not only have to handle the development of their product, but have to do so on a massive scale at the moment of their creation, and have deadlines to meet while being scrutinized by thousands of customers whose money they are on the hook for. This is especially problematic when projects go viral and take on tens or hundreds of times the volume of customers that they intended. (This virility can also afflict smaller projects, but is more problematic with larger ones.) This lead to delays and oftentimes creates unnecessary stress for the project creators. As a user, I am subjected to delays and take on greater risk. (There is always the chance that the project may cripple under its own weight, or may not be delivered as promised.) This type of funding is ineffective and is better left to the traditional funding apparatus.
The middle range is the range that can truly benefit from Kickstarter. These projects are modest enough in scope such that they can't get funding from an investor, but non-trivial to the point where they require capital to get off the ground. These tend to be things like books, albums, and photography. These are projects for which Kickstarter was intended, and these are the ones that benefit users while providing them with actual utility (in the form of a project that otherwise couldn't exist). Unfortunately, projects like these are being crowded out by the other two types of campaigns.
I've always maintained that Kickstarter is not commerce. It is investment. As a funder, you are (ostensibly) subsidizing something's existence at a substantial risk. In many cases, this risk is unnecessary and could be averted by simply using traditional funding mechanisms. I can see no reason why I would want to risk my own time and money to fund projects that could be funded by the individual themselves or a billionaire VC. As backers of projects, we often experience identical or worse outcomes than if the project had not used Kickstarter. To me, the collective infatuation with Kickstarter seems absurd. Kickstarter is useful in a great number of circumstances, but more often that not, it is a net negative for the end user.