When crowdfunding campaigns go bad

Although working prototypes were provided to technology publications (including TechRadar Pro) for review, campaign backers still haven’t received the SSD, now ten months after the estimated shipping date.Updates posted on the campaign page report that the GigaDrive team encountered a variety of difficulties, including an Indiegogo investigation in response to a Forbes article, bank transfer problems and supply chain shortages. The GigaDrive team have left responses to some backers saying they have been reimbursed, but others have been left in the dark about the status of their refunds.The comments section also reveals backers are frustrated with Indiegogo, not just GigaDrive, with many complaining about the crowdfunding platform’s lack of response to the floundering campaign. Indiegogo also shared the creator's contact information, which was out of date, with the backer and informed them they could take legal action against the SSD makers.However, the backer told us that Indiegogo did not respond to follow-up questions asking about the status of its investigation and declined to provide further information about what action it would take to help those who supported GigaDrive's campaign. This perhaps should have been no surprise, given the creators noted in their FAQs that the funding goal "does not cover the cost to build the game" and was instead going to be used "to begin building our community”.The penultimate update for the Space Odyssey campaign, posted on April 10 2020, noted that most backers whose rewards included physical goods, like signed merchandise, had received them. The pair then worked with Cryptozoic Games to put the product into the hands of the backers.A crowdfunding campaign that fails to deliver on its promises is a source of disappointment and frustration to its supporters, whether it's fraudulent or not.To see what crowdfunding platforms are doing to protect backers, TechRadar Pro reached out to Kickstarter and Indiegogo, two of the largest companies in the space. When asked how Indiegogo uses these tools and how successful they have been, Haines remarked, "over the past year we have been more aggressive about providing backers with transparent project status and contact information when we determine that entrepreneurs have gone silent”."In practice, the threat of actions like collections have been most helpful as a mechanism to encourage good behavior, but we have also had some successful collections actions that allowed us to return funds to some backers,” he added.However, it’s worth bearing in mind that both Kickstarter and Indiegogo emphasize they are not stores and backers are not buying a product. So what can backers do to protect themselves?Lars Hornuf, a professor at Universität Bremen in Germany who researches crowdfunding, recently published a paper that identifies several red flags associated with fraudulent Kickstarter campaigns.Hornuf told TechRadar Pro in an email exchange that, to avoid such campaigns, backers should “look at the profiles of those seeking capital as if they were buying something on an ecommerce platform”.He also advised potential backers to ask questions such as:If backers only identify a red flag after a campaign they've supported is successfully funded, they should reach out to the crowdfunding platform and the creator of the project.