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Where's All That Kickstarter Cash Actually Going?

Where's All That Kickstarter Cash Actually Going?

What does an artist or entrepreneur do when they run out of money and hit a brick wall? Open up a Kickstarter campaign of course. The website allows people to share their vision (and set a goal of how much it will cost to get their) with friends, family, and other possible backers. It has allowed many people to see a project through to the finish that may have otherwise given up.

But every once in a while a Kickstarter goal is met and then some, opening up the entrepreneur or artist’s original budget up to scrutiny. Another scenario that attracts negative attention is when someone doesn’t actually follow through with their project even though the goal was met, leading Kickstarter backers to wonder just what the beneficiary of their investment is doing with all of that money.

A recent Gawker report highlights the scrutiny surrounding musician Amanda Palmer’s recent Kickstarter windfall which exceeded one million dollars to make a new album. Palmer’s original goal was $100,000, but fans ended up giving the artist 12 times that.

After receiving some negative press about how she was spending the Kickstarter cash, Palmer released a budget update outlining exactly where the money was going. The update did little more than attract more scrutiny with many saying the numbers just didn’t add up.

Palmer attracted even more negative attention when she put out an ad to hire musicians for a live show but would not be paying them for their work. Owen Pallett, a Canadian musician, responded to the budget outline on Palmer’s Tumbler saying, “I am having a hard time reconciling your assessment of your Kickstarter obligations with your current claims toward being unable to pay for yours and Jherek's string quartet. For example: $100/unit for a 7" is 500% more than any 7" per-unit cost that I've ever heard of. $300/unit for an art book is frankly preposterous. The most expensive art book store in Switzerland would maybe sell a couple books for that price, off the rack. Even if these figures are genuine, I believe that I could help you source some less expensive (but still luxury) manufacturing options.”

Have you ever created or contributed to a Kickstarter project?  What was your experience like?

Do you think people who have Kickstarter campaigns should be required to outline their budgets to those who make donations?
 

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  • sherrybaby By sherrybaby
    09.27.12  

    This is the problem with sites like Kickstarter. Its a terrific concept but, investing your money in projects on kickstarter can be VERY risky.

  • zrenee By zrenee
    09.27.12  

    be aware of her language in her post. I won't donate one cent to someone who talks like that for sure.

  • corabishop By corabishop
    09.28.12  

    I have never heard of a kickstarter account.

  • ToshaL By ToshaL
    10.07.12  

    Kickstarter may be a great way to donate, as the word means DONATE. If you have feelings that something isn't quite right, always go with your gut!

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