Success proves to be slippery slope for many crowd-funded companies

Crowdfunding websites such as Kickstarter, Indiegogo and Peerbackers provide a way for people to donate to a variety of things. But when those things succeed, some investors are unhappy with their decision.
By JOSEPH PISANI, Associated Press Modified: April 2, 2014 at 10:31 pm •  Published: April 2, 2014
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When Oliver Housknecht gave virtual reality headset maker Oculus VR $25 through crowdfunding website Kickstarter two years ago, he wanted to help a startup grow into a larger, independent company. Instead, Oculus became part of one.

Housknecht was shocked last week when Oculus announced it was selling itself to social media company Facebook for $2 billion. He was one of many backers who helped it raise more than $2.4 million through Kickstarter in 2012.

He wants his money back.

“Why do they need my $25 now?” says Housknecht, who does technology work at a hospital in Kansas City, Kan.

Crowdfunding websites such as Kickstarter, Indiegogo and Peerbackers provide a way for people to donate to a variety of things including community projects, vacations, independent films and even small companies. On Kickstarter alone, users have pledged to give more than $1 billion since it launched in 2009. The backlash over the Oculus deal puts a spotlight on the people who donate with no expectation of a financial return to businesses as varied as bakeries and smartphone app makers that aim to turn a profit someday. It also highlights the tension that could arise when those funders disagree with a company’s decisions.

The Oculus Kickstarter page was ablaze last week with outrage about Oculus selling to Facebook. Some donors — including people who gave $300 or more — argue that Facebook will ruin Oculus. Others say Facebook, with a market value of about $159 billion, doesn’t need their hard-earned cash.