[libreplanet-discuss] Solving the prisoner's dilemma in crowdfunding

[Fabio Pesari]

Alice wants to build X, and Bob wants to fund Alice's effort. X is to be
released under a free license.

There's a problem, though: Bob doesn't want to pay in advance, because
he's afraid Alice will not deliver X as promised. In a typical
crowdfunding scenario, there are hundreds of Bobs, so this issue is even
worsened.

Likewise, Alice doesn't want to be paid at work finished, because she's
afraid Bob won't pay her. She's also afraid that her time or budget
estimate might be wrong, which might ruin her reputation forever even if
she works earnestly.

Both scenarios happened in the past, so their paranoia might be
justified, but the lack of crowdfunding efforts right now is IMO the #1
reason free software development is often slow and/or has to compromise
(often by adopting permissive licenses, which inevitably helps
proprietary programs).

How to keep blind trust out of the equation?

My proposal: a nonprofit organization evaluates Alice's project. If they
determine her time estimate is right and her prior experience is
sufficient to develop X, they raise funds for it and keep them as an escrow.

After the time limit expires, the organization's committee
thoroughly evaluates X against the initial goals Alice set out to
accomplish (works well for software and hardware designs but doesn't
work for art, obviously).

If the committee acknowledges that X fits the original specifications,
Alice is given all of Bob's money, which she rightfully earned.

If, however, it doesn't, Alice will still be forced to release
all the work she's done under a free license, and the original funders
(the Bobs) will be allowed to withdraw their donated sum if they aren't
satisfied with what they see.

In short, in order to give out refunds:

1) The organization judges Alice's product as unfit to the original
   specifications
2) Each funder must voluntarily ask for a refund (so, if a funder is
   satisfied with Alice's unfinished work, they can still pay her)

I think this is fair to both Bob and Alice. It's slightly weighted in
Bob's favor, sure, but as we said there are always more funders than
developers in crowdfunding and as a free software supporter, I believe
users come before developers, so the whole community should benefit from
Alice's work in any case.

What do you think? Would this be feasible for an organization like the
FSF or the SFConservancy?