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

[Adam Van Ymeren]

Since there are more funders than developers shouldn't you favour
developers instead?

One of the core ideas of crowdfunding is that people would be more
willing to accept risk because they only fund a small amount in
conjunction with a lot of other funders.  Alice still receives a large
amount of funding, but in small increments from many people.

I don't think putting more risks for Alice not receiving payment is
going to encourage her to develop more.

On Fri, Feb 19, 2016 at 9:42 AM, Fabio Pesari <fabiop@gnu.org> wrote:
> 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?
>