What Kind of Tech Company is Kickstarter?
Well, as their former copywriter I could tell you in about 1000 different ways and at varying lengths and tone of voice, but that would be insane and probably unethical. Nevertheless, Kickstarter hit a big milestone this week: a billion dollars have been pledged to projects. From there, it isn’t hard to figure out how much revenue they’ve made, and Quartz is on it:
Kickstarter takes 5% of every successfully funded project, so while it has brought in $859 million in donations, the site itself has made only an estimated $43 million in revenue since launch. (A source at Kickstarter has confirmed that the actual figure is close to this; the site didn’t take a cut from funded projects for the first few months.) For a “tech” startup—at least among those that make any money at all—$43 million in cumulative revenue over four years is a vanishingly small number.
Which means Kickstarter is either a pretty good lifestyle business founded by artists who are committed to their stated purpose—democratizing the funding of creativity—or, by Silicon Valley logic, a kind-of terrible business that requires way too many humans in order to “scale.”
I love this, because YES. Also it is the first one, or it is both, but the first one has been stated and restated by the company again and again.
BIASED COMMENTARY: Also I love the ‘only’ $43 million. Actually for a “tech startup,” making any money at all that is not handed over from a venture capitalist or an acquiring corporation is a LARGE AND NOTEWORTHY amount of money. It is a ‘sustainable business’ amount of money. A buy-a-building amount of money. A not-absurd and unreasonable amount of money.
Yancey says he feels absolutely no pressure to violate his and his co-founder’s original promise to never sell Kickstarter or take the company public.
“We have 79 employees and a nice office and everyone has insurance and we’ve been in the black for years now,” says Strickler. ”We’ve been able to be a sustainable business that continues to grow. Investors asking for certain things has never been a part of our life and never will be. That puts us in a very fortunate position to do right by our world and our family and friends and community.
Now, does this mean I will probably never get a fat return on my employee stock options? PROBABLY. But I still genuinely support the ethos of the company. In theory. For now. Before my kid goes to college (jk).