Posts Tagged ‘crowdfunding’

Ubuntu Edge failure and what it means to me

A few days ago I received a credit from Indiegogo, because the USD$600 that I pledged for the Ubuntu Edge didn’t work out (I pledged on day one not because it was cheap but because I felt I needed the device and thank Canonical for the wonderful work they’ve done in addition to being brave about going into new markets; I would have paid $895 if need be – we don’t get heavily subsidised phones where I come from). There was a lot of buzz about how this is the largest crowdfunding experience ever, and so on, but to me, as a believer in opensource, I feel this failure to get an Ubuntu Edge more than ever.

It was by no means a shoddy amount that was pledged, in the sense that it raised USD$12,813,501 out of the USD$32,000,000 goal. I was curious with who pledged, and this is quite public as well – see the pledges list. But what you see is that a lot of people pledged not for the phone but smaller amounts which I guess is a huge problem.

Simply put, you need about 50,000 people (community members/Ubuntu users/etc.) to pledge to buy the phone (at an average sale price of USD$695). A mere 50,000. I planned to analyze the data, but its great that The Guardian did most of the work for me, so read: Ubuntu Edge: how many phones were really ordered – and the mistakes.

14,577 individuals pledged to order the phone. Enterprises were shy by the looks of it.

Out of the 14,577 individuals, I expect many of them to be Ubuntu users to some extent (if not lovers of opensource). Where are the rest of the Ubuntu users?

The public stats for Ubuntu are quite impressive – generally it is the most popular desktop Linux distribution out there. Just look at the adoption & reception: in June 2009, it was estimated that there are 13 million active users; in fall 2011 Canonical itself estimated more than 20 million users worldwide. This number must have grown tremendously, but even at a 20 million base, you’re looking at 0.073% conversion rate to buy an Ubuntu Edge.

I know people that are Ubuntu users and wanted to buy it, but not at the price point. Over $600 for a phone with a computer that docks just isn’t feasible as a cost in many parts of the developing world. Without user registration, we can’t tell where Ubuntu users are located, but I’m willing to bet it’s a good mix between the developed/developing world, right?

I was hoping to hold an Edge in my hand come May 2014. I’m still hoping to hold an Ubuntu mobile device in my hand. While I am disappointed, I can imagine Mark Shuttleworth asking himself a lot of questions. He’s spent millions developing Ubuntu, the community that surrounds it and the commercial aspects around it. Apparently monetizing the userbase is harder than it looks.

My Kickstarter experience

In may 2012, I went on a little shopping spree on kickstarter. The intention wasn’t to invest in a project but back it. Its clear many people get confused with the concept. Backing a project isn’t like going to a store to buy or pre-order a product either.

Backing a project is rooting for its success. With money, one can only presume that projects execute and whatever was promised gets delivered. It seems however that my kickstarter hit rate is so far a mere 50%.

I backed a project that successfully delivered the goods in September 2012. I was rather thrilled because it clearly made someone’s dreams come true. Another project that I had backed should have delivered on the goals by the end of July.

Sadly, its November and many of the backers haven’t heard back from the project owner. Many comments from concerned backers are posted in the comments section.

Me? I backed what I consider a small amount. In funding, sometimes things fall thru, and in backing projects, sometimes things don’t work out even when the funding goal is reached. Money alone doesn’t make a product!

Is this however a problem? Will someone that has been burnt by a negative backing consider using the Kickstarter platform again? Will it ruin crowdfunding for them?

I don’t have the answers. I will continue perusing the site, backing interesting projects, ensuring people’s dreams can be achieved. Let’s see if my success rate improves over time.

pitchIN, the Kickstarter for Malaysia

I’m a huge Kickstarter fan. I enjoy backing creative projects and seeing the outcome. I prefer outliers, not surefire success stories like the recent Kickstarter by Seth Godin (25 days more to go, $221,259 reached out of a $40,000 goal). The only problem with Kickstarter? It allows projects from the USA only. The world is bigger than the US and there are projects elsewhere that can benefit from this crowdfunding phenomena. 

How does Kickstarter work? You pledge a certain amount to a project. You hit the Amazon Payments gateway. It confirms you may make a transaction at a certain date. Then you can follow the project updates, etc. before the pledge date closes. If pledging is reached, when the closing date arrives, your credit card gets charged. Otherwise, you can forget that you even made a pledge! (read more). Read more about why Amazon Payments as well (this becomes important for pitchIN later).

pitchIN | Crowd Funding in Malaysia funny error messageI read about pitchIN on June 12. I believe that I was so excited I hopped on over to the project to take a look at it. I browsed every available pitch. Then I decided to plonk down some change on one project. pitchIN uses PayPal so the pre-authorization happens on your credit card, basically immediately. With Malaysia now telling you everytime there’s a transaction, you get an SMS telling you about this “charge”. You’ll only know its not a charge when you visit Paypal and notice this is just an authorization, nothing more. I’m glad the pitchIN team contacted me within 24 hours to tell me about this via a Facebook message as well, but it isn’t the best “first experience”. PayPal Website Payment Details - PayPal pitchIN

A few suggestions:

  1. Forget this USD thing. I’m sure you want international pledges, but USD for Malaysians is just prohibitive. People think in MYR and the USD fluctuates on a daily basis. Questions like do I get the pre-auth USD$100 rate on June 12 versus July 11 which is closing date? Who makes the difference in currency exchange? Will I get the pre-auth amount returned to me if the pledge doesn’t make it based on a different currency exchange rate? I have no idea, and I’m willing to bet Team pitchIN doesn’t either.
  2. The interface needs to work. It is currently very raw. Lots of “sorry matcha” error messages.
  3. Pitch videos need improving.
  4. A paypal email address like (which really is WatchTower & Friends, the company name) doesn’t inspire great confidence.
  5. Fix the SMS from the bank. PayPal might have a better way to do pre-auth. Or banks shouldn’t send SMS’s during pre-auth. It turns customers away (first pitch shouldn’t be an issue, what about the next?). I hate to imagine this being a regular customer service question.
  6. Got to iterate faster. Its 10 days since I last visited the site. Nothing has changed.
  7. If you’re starting a project, remember that pitchIN charges a 5% fee in addition to PayPal’s 3.5% processing fee. This is exactly like Kickstarter, but worth keeping in mind.
  8. PayPal notice about seller and buyer being in Malaysia… well I’m using a Malaysian account and I’d presume is Malaysian too… So odd message to contend with.

All in, I’m hoping pitchIN succeeds in getting Malaysian creative projects funded not only by Malaysians but by the vast Malaysian diaspora. Best wishes and I’m looking to further try this out when its iterated upon. So far nothing is “bringing me back” to the site, so that’s something that clearly needs to be worked on…