Crowdfunded Android Console Ouya Reportedly Seeking Buyout

An anonymous reader writes: Ouya, the Android-based games console, enjoyed one of the most successful crowdfunding campaigns to date, raising $8.6 million after asking for only $960,000. But now that the console has been on the market for a while, the company is struggling. After borrowing roughly $25 million from investors to keep it going, they're now trying to restructure the debt, and reportedly seeking a buyout. "Interest in Ouya's microconsole has dropped considerably since its launch back in 2013, where it had to offer store credit to dissatisfied Kickstarter backers for failing to deliver devices on time. Following disappointing sales figures for early games, the company has tried several times to turn its fortunes around."

Comments

Why is that a problem?

[SuperKendall]

The problem is that that Kickstarter is really nothing more than distributed venture capital. Except that normal venture capital gives you a share of the company or future profits.

Here's a thought - what if that is OK? What if someone is OK being a venture capitalist whose only return is to possibly get a cool product they would like to see exist?

I think the real "problem" if there is one, is people who think of Kickstarter as a store instead of venture capital with product as a return.

All you get is a promise for a future product.

You don't get that; you get a promise they will *try to create* the product. The work Kickstarter has done in terms of validation and required disclosure is to try and make it as clear as possible, how likely that promise is to be kept.

discontent among users about failed projects

Those users can go take a flying leap as far as I'm concerned. I think there are enough people that understand what Kickstarter is, that it will continue to do well.

treats it as such by letting "investors" buy "shares" of the companies seeking funding thus making it obvious that they are also buying all the risk that comes with that

Sorry but I wouldn't touch that nebulous piece of crap with a ten foot pole. What Kickstarter is now is pretty clear I think, at this point everyone knows Kickstarters can fail, so they know there is risk. The disclosure items at the bottom give a good amount of information to fairly evaluate that risk.