Kickstarter, the popular crowdfunding site that has helped launch many video games, comics, web series and films over the last several years, is finally making an effort to revise its terms of use to clarify the relationship between project creators and backers and, in particular, to explicate the responsibilities that creators have to their backers, the company revealed today via its official blog.
Kickstarter has traditionally taken a "hands off" approach to the use of the service. Company officials depict the crowdfunding site as a platform, a middleman, rather than a participant in transactions between its community members. Kickstarter has never offered any kinds of guarantees or enforcement of project completion, and won't get involved in any disputes between backers and creators except to work with authorities investigating fraud. However, Kickstarter considers the backing arrangement to be a binding legal agreement between creators and backers, with creators being legally obligated to fulfill the project and any associated rewards.
Unfortunately, none of that is changing with the update Kickstarter announced today. But the company rewrote its terms of use in plain English, and added a section with notes on the creator/backer relationship, and specific requirements for creators in the event that they are unable to complete the project and/or deliver on their promises.
"If a creator is unable to complete their project and fulfill rewards, they've failed to live up to the basic obligations of this agreement. To right this, they must make every reasonable effort to find another way of bringing the project to the best possible conclusion for backers," the updated document reads.
"Every reasonable effort" includes starting off with an explanation of the work that has been completed by that point, how the backers' funds were used and the circumstances preventing the project from being completed. Project initiators must "demonstrate that they've used funds appropriately and made every reasonable effort to complete the project as promised," and throughout the process, project creators must continue to communicate honestly with backers. And as always, project originators are required to offer refunds for unfulfilled rewards, "or else explain how those funds will be used to complete the project in some alternate form."
Only if creators satisfy those conditions are they considered to have met their commitments to their backers and "remedied the situation." Finally, the terms of use unequivocally warns creators that if they don't meet these new standards, they open themselves up to possible legal action from backers.
These revised terms of use will go into effect on Oct. 19th, and will apply to all projects launched on or after that date.
