The Source of Kickstarter's $100 Million Crypto Investment

For many years - Kickstarter and its billions funded - the platform of crowdfunding has been an invigorating signal flare beckoning for the attention of artists, designers, and innovators to have their projects as made as their visions. 

However, Kickstarter is changing with the times and in order to remain relevant and grow, it needs to uncover new ways of doing business. This started a the quest for a $100 million investment which would allow to pivot from old world to exciting new world of blockchain, a pursuit that ultimately materialized but initially in secret. 

In this article, we will discuss the origins and consequences of the decision made by Kickstarter to invest in cryptocurrencies for the first time, to explain what it means for the future of crowdfunding and innovation.

The Genesis of the $100 Million Investment

Then in late 2021, Kickstarter staff encountered an unexpected boon. This attracted an offer from an investment group to buy shares from staff, leading to a large $100 million investment, led by a16z, the Andreessen Horowitz crypto fund. 

This $100m Kickstarter investment was mainly funded as sources tells us due to a vision for integrating blockchain technology into all operation of Kickstarter.

Andreessen Horowitz’s Role

This investment was anchored by prominent venture capital firm Andreessen Horowitz, a big name in the crypto and blockchain space. 

Led by the firm's crypto fund a16z crypto, the round is built with the idea of turning Kickstarter from a conventional crowdfunding platform to a fully decentralized and blockchain enabled platform. 

The origins of this crypto 100m Kickstarter contribution were tactical (by exploiting blockchain features)​

The Vision for Blockchain Integration

The capital injection also came with a grand vision: to transition its community-centric platform to the environmentally conscientious and scaling solutions of Celo's blockchain. 

The idea was to build a new kind of crowdfunding protocol that could open up crowdfunding in a way that was transparent, decentralized, and for everyone. 

The sources behind this 100m Kickstarter crypto investment knew the blockchain could change crowdfunding by offering indelible records and decentralised control.

Challenges and Controversies

The move to a blockchain, despite being an ambitious dream, presented major barriers. The biggest difficulty it faced, however, was pushback from Kickstarter's most important constituency—the many creators (and backers) hostile to blockchain technology. 

From worries about the ecological impact of blockchain to concerns over the complexity and possible dangers of the transition, the fears were many. The move also led to the speculation — and still does, given rumors that the host may return from time to time — that maybe the platform would stop being a place for creative projects.

Following the backlash, Kickstarter created a community advisory board to hear the complaints and make changes based on feedback from users. It wanted to guarantee that any transition would conform with the values and expectations of the community, the firm said. 

Yet despite this endeavours, the blockchain initiative was cancelled, reflecting a difficult situation that involved a desperate fight between innovation and the necessary trust and acceptance of its users.

The Aftermath and Current Direction

Since then, Kickstarter seems to have abandoned its blockchain pivot, and has instead focused on finding new ways to remain relevant and innovative. With the company announcing the arrival of new CEO Everette Taylor, the focus is now on how well he can navigate the platform to healthier profitability, not to mention how to meet the changing whims of its user base. 

Kickstarter, thanks in part to Taylor's leadership, remains deeply engaged in improving its core services, as well growing its human relationship with user bases, all while it continues to explore new opportunities in crowdfunding without immediately having to pivot to blockchain.

Implications for the Future of Crowdfunding

The story of the $100-million crypto investment that Kickstarter never made is a cautionary tale — but it's also a story of missed opportunity. The blockchain pivot didn't pan out as intended, but the experience proved invaluable for Kae Kruse and maybe, perhaps, the crowdfunding industry as a whole. It illustrates the need for technology investor interest to be in line with user expectations and the primary use case of the platform.

Kickstarter provides a mechanism for other platforms and tech companies to learn about the path and pitfalls associated with transitioning to new technology. This 100m Kickstarter into crypto was backed by sources that show the advantages that can come with blockchain integration such as improved security and transparency, yet it also serves as a good reminder that it must be done in a manner that is well planned and that the community wishes​​.

Conclusion

Andreessen Horowitz ’s a16z crypto fund decision to just invest 100M USD on Kickstarter is a huge milestone in the history of the platform. Although the ambitious project to convert to a blockchain model was ambitious and stalled out, it highlighted the way tech and crowdfunding continues to innovate and evolve. 

The more the dust settles on this event, the clearer it will become how this experience helped mould Kickstarter as it continues to find its way through this new territory.

Kickstarter is a prominent success story of the technology and crowdfunding landscape where innovation meets user trust and appetite for progress. 

Still a significant player in both creative funding and digital innovation, Indiegogo remains relevant on the landscape while seeking to satisfy trends with both a commitment to its pioneering roots and this practicality of the userpath. 

While the sources of this crypto 100m Kickstarter may have been through struggles, they also served as an apparent channel for growth and adatation possibilities.