How the “triumph” of the Kickstarter king would have looked like on W12?
Do you remember the tragicomic story that happened with an inventor from Portland named Ryan Grepper? In the summer of 2014, he launched a Kickstarter fundraiser for Coolest Cooler, a really cool mini fridge with LEDs, with a bar, and boom box functions for just $185. The guy was in for a win, as he received over $13 million in contributions in one month, the attention of all American media and the title of King of Kickstarter to boot. The problems started later.
More than 60 thousand backers unsuccessfully waited for the product for six months. Three months later, we learned about some technical difficulties. Then that the price of the cooler turned out to be more expensive and now not everyone will get it and not on time. Kickstarter representative Justin Kazmark then shrugged “We are not a store, but an investment fund. The backers themselves must weigh the risks.”
And then the mini-refrigerators surfaced on Amazon at $500. Ryan did not lose his cool and explained everything. It turns out that the proceeds from the sales will be directed at the pre-sale of the first batch for Kickstarter. And if the waiting lot do not stint on an additional $100, they will get the coolers faster! As a result, only in 2017, after the intervention of the Ministry of Justice, all the backers received their refrigerators.
And now, let’s imagine how this story would have developed not on Kickstarter, but on the W12 platform.
First, Ryan Grapper chooses one of the three available ways to interact with the backers. For an example this:
Second, Ryan binds the project’s implementation to a detailed roadmap, where all the key points are marked down. Suppose the release of a prototype of a refrigerator and a demonstration of its capabilities is the first such point, then rental of premises for mass production is the next, and the purchase of equipment and materials is the third. And so on.
Third, when Ryan collects his $13 million, they are stored in W12 Tokens. The smart contract calculates and transfers to him the first installment to achieve the first key point. Each backer spends about 5% of their money in this installment. And here comes the first control point, but the prototype is not yet ready. Several backers decide to return their unspent $175 ($185–5%). The rest of the community continues to believe in Ryan.
Fourthly, if Ryan implements the prototype with delay, the second installment to reach the second key point is unlocked and transferred to Ryan’s account. But will he have enough money to rent a storehouse now? If necessary, new backers can finance the project by buying the tokens of the participants who left at a discount for $175. That is, they will eventually get the product a little cheaper.
Fifthly, when Ryan is coping, making a lease agreement, and provide payment, all the necessary documents and transaction data are recorded in a public distributed registry (blockchain). These records are immutable. At any time and from anywhere on the planet, they can be checked by any backer. The next point has been reached, and in the absence of objections from the side of the backers, the smart contract transfers the third installment to Ryan.
Finally, problems started with the purchase of equipment and materials. Ryan is talking about a project cost increase, and not everyone will get a mini-fridge. Most investors return their unspent funds, which are only about $140 at that time.
Dilemma, if Ryan is not rehabilitated in the near future, then he will finally ruin his reputation and lose all the investments. At this point, Ryan also has alternative options:
- He can release more product tokens and attract additional funding;
- He can create a new project roadmap in a smart W12 contract and send it to the backer community for voting. If 51% of the backers and more accept it, then the development of the project will be able to take place according to a new scenario.
