Investor management presents another challenge for founders

Because crowdfunders generally fund in smaller amounts than, say, angel investors, more investors are required to raise a given amount of capital. Investor management therefore may be significantly more costly due to the sheer number of funders who need to be managed. The process can be particularly daunting as the number of investors rises. In the case of the Pebble watch, as of March 2013, the team had delivered 34 detailed updates about the software and manufacturing of the product and received about 14,000 comments from the Kickstarter community. 16 Moreover, whenever a project fails to meet a deadline or expectations, funders typically demand increasing levels of attention. Although such interaction allows creators to collect feedback, it also diverts resources and time from execution. Max Salzberg, who unexpectedly raised $200K on Kickstarter (from a $10K initial target) to develop an open-source alternative to Facebook, described his team’s experience as “so consumed with things like answering e- mails and making T-shirts for their contributors that they had little time to build the software” (Wortham, 2012).