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Kickstarter Just Did Something Tech Startups Never Do: It Paid a Dividend (bloomberg.com)
Joshua Brustein, reporting for Bloomberg: In early March, Kickstarter quietly sent shareholders a dividend. In the wider world of business, such an action would be unremarkable. More than 80 percent of the companies in the S&P 500 pay dividends, and many smaller companies do, too. But divvying up quarterly profits with shareholders is unheard of among tech startups. People who follow the venture capital industry were hard-pressed to come up with a single example of a VC-backed startup that has ever paid regular dividends. Doing so would be a rejection of the industry's basic math. VCs bet that they can find the few companies that will generate enormous payouts by going public or getting acquired; the rest fail. There's not supposed to be anything in between. "It sounds strange for a VC-backed company as it means they're taking out and distributing money versus investing it in the business," said Anand Sanwal, the chief executive officer of research firm CB Insights. Paying a dividend, which the company didn't make public, is just the latest example of Kickstarter's heterodoxy.
Since Kickstarter epitomises the degenerate capitalist spirit - provide no value beyond handling cash and taking a hefty cut - it's no surprise that it would be one of the business models so successful that it can afford to pay its shareholders a dividend.
Which is ironic when it's business is giving the chance for other start-ups to receive investment without ever having to pay back their investors.
We really are back to the feudal attitude where people felt a loyalty to the boots they licked.