I talked about this a bi6 on tonight's Tavern Chat podcast, but I thought it was important enough to touch on here.
Original Gizmodo article
“While people are continuing to support live projects on Kickstarter as normal, the COVID crisis has led to a 35% drop in live projects from a year ago,” David Gallagher, Kickstarter’s senior communications officer, told Gizmodo in an email. (Less than a month ago, the company stated that “the number of live projects on Kickstarter is down about 25% from this time last year,” suggesting the financial situation is continuing to worsen.) “Fees on funded projects are our only source of income. Our margins were already thin before the crisis, and we don’t know when this situation will turn around,” Gallagher stated.
The news of potential layoffs were reported last month, but the size of those reductions staff reductions was only made public last night by OPEIU, the union which Kickstarter employees successfully joined in February, becoming the first major tech company to organize. According to the union, members “voted tonight to ratify a lay-off agreement with the crowdfunding company after CEO Aziz Hasan announced sweeping layoffs of up to 45 percent of employees.”257 employees. 117 on the chopping block.
Hm, I thought Kickstarter would be mostly immune from the Covid Crash, as it's all done remotely - shows what I know . . .
ReplyDeleteProject creators are concerned that people might not have a lot of disposable income at the moment, so they aren't creating as many projects.
DeleteThe company's business model is basically to suck out a hefty percentage of every project in return for ... well, being on kickstarter an not much else. How on Earth can they suddenly be not profitable? My guess : ho's an blow, an lots ot it.
ReplyDelete