Getting Started on Kickstarter: 3 Legal Tips

Crowdfunding site Kickstarter has been in the news this week after an Ohio man decided to crowdfund his first stab at making potato salad -- and managed to raise nearly $60,000 from more than 4,000 people so far.

Zack "Danger" Brown had hoped his somewhat tongue-in-cheek Kickstarter project would reach his goal of $60, reports The Columbus Dispatch. His runaway success is further proof that whether you're looking to fund your own personal project or become part of someone else's, Kickstarter can be a great tool for making a lot of really cool stuff (or just a lot of potato salad) happen.

If you're curious about crowdfunding, here are three legal tips to get you started on Kickstarter:

1. Kickstarter pledges are non-refundable. If you get caught up in the moment and decide to pledge $50 towards some guy's potato salad project, don't expect to be able to ask for it back. According to Kickstarter's terms of use, Kickstarter does not offer refunds; project creators (those whose projects you are funding) are required to give refunds only if they can't deliver the promised reward. Of course, if the project you back fails to meet its funding goal, your pledge will not be collected in the first place.
2. Any dispute is between the donor and the project creator. Kickstarter aims to be the quintessential middleman, facilitating funding but steering clear of any further involvement. This means if the project you back fails to live up the hype, it's up to you to take it up with the project creator. According to the site's terms of use, "Kickstarter does not oversee the performance or punctuality of projects." In other words: caveat emptor kickstartor.
3. Project creators can cancel at any time. Even after a project has been fully funded, a creator can get cold feet and cancel at any time. The creator would then be obligated to refund your pledge, but many are slow to do so. A Reddit user has even compiled a list of cancelled or never-fulfilled projects, many of which far surpassed their original fundraising goals.

Kickstarter can be a fun place to find zany, cutting-edge projects. But just make sure to back projects cautiously. Creators sometimes bite off more than they can chew, or promise more than they can deliver. Case in point: Of this writing, Zack "Danger" Brown is currently slated, under the terms of his project, to read 1,327 names out loud while making his potato salad. Maybe that's why "danger" is his middle name...

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Related Resources:

• Three Kickstarter Food Projects That Leave Potato Salad In The Dirt (NPR)
• Crowdsourcing Your Invention? 3 Legal Tips That Can Pay Off (FindLaw's Free Enterprise)
• 7 Simple Steps to Protect Your Online Privacy (FindLaw's Law and Daily Life)
• What to Do When Your Kickstarter Fails (FindLaw's Free Enterprise)