[runako]

Sure, Adapteva has raised ~$1.5mm in VC and another ~$850k in debt. Now they are raising $750k on Kickstarter, the "funding platform for creative projects." There's a big disconnect there. If well-funded companies like Adapteva are successful raising on Kickstarter, why wouldn't even bigger companies milk the Kickstarter sheep for R&D funds too? While it wouldn't violate the letter of Kickstarter rules for Intel to run a campaign like this, certainly it's not in the spirit.

And yes I get that it's open source blah blah blah, but this project is certainly part of the plan for an institutionally-funded business to make money. Adapteva is a .com, not a .org.

Separately: if Adapteva is only 8 months from delivering completed product to users, shouldn't they be able to raise more funds through traditional channels? They clearly have/had VC buy-in and can raise through institutional channels. If they are just finishing the final debugging/SDKs/etc. at this point, it's not a good sign that they can't raise another $750k from their existing backers to cover final launch costs.

I don't have a horse in this race, but it doesn't feel quite right to me.

[adapteva]

Let's correct some of your assertions: 1.) Adapteva raised $1.5M from a small board business (not a VC) because it couldn't get a VC investor. 2.) A "well funded" semiconductor is one that takes in $100M like Calxeda. Adapteva has done "more with less" than any chip company in history. 3.) Adapteva is a chip company. The Parallella project is not an "R&D effort" it's about bringing the cost down for an open board product that the developers clearly want and that the industry needs. 4.) Adapteva has talked to >50 large institutional investors. Mostly they are either afraid of going up against Intel, Nvidia or they flat out don't invest in chips. 5.) Kickstarter is not just for non-profits.

[runako]

First, I didn't mean to sound quite so negative on your project. I actually hope you succeed. If this is something the industry needs, I have no doubt you'll be a wild success.

I just take issue with raising money from unsophisticated unaccredited investors without even providing complete disclosure or binding contracts in return. I know a lot of companies do it, and I dislike it in those cases too. I also know I'm in the minority here and that it's only a matter of time before companies with huge VC backing & public companies are using Kickstarter to raise money. I think that's a bad thing, but others disagree.

Also, quickly:

- I'm not against for-profits using Kickstarter; most of the efforts there are for-profits. But companies that have raised millions of dollars probably should disclose that fact prominently in their campaigns.

- Similarly, the fact that you've been denied investment by >50 institutional investors is relevant in asking for money. It might be positive for some, negative for some. But it's likely not going to be a no-op for most.

- My figures come straight from Crunchbase, I'm not more connected than that.

[mchusma]

I don't think a $2.35M round is really that much for a chip startup. The fact that they even think that they can plausibly launch a chip and some level of supporting documentation, software, etc for ~$3M total, that is a remarkably efficient use of funds. By the way, Kickstarter funds are "cheap" (no dilution & no debt) so anyone who can actually raise money on Kickstarter should do so.

[runako]

I'm not qualified to evaluate how much money a modern chip startup needs to launch a product. But it's worth noting that the Kickstarter pitch doesn't mention the millions the company has raised so far (apologies if I missed that part).

>> Kickstarter funds are "cheap" (no dilution & no debt)

Of course they are, and that's kind of my point. Raising money from unsophisticated unaccredited investors without providing full disclosure or even a contract in exchange is obviously a great source of capital. However, I'm not convinced pitches like this would withstand scrutiny by the relevant regulators if they were not asleep at the switch.

I didn't mean to be overly critical of the project. I wish them all due success. That doesn't mean I can't dislike the Kickstarter campaign. (I would similarly dislike AMD raising funds on Kickstarter, even if I liked the project.)

[wmf]

They're not investors, they're donors.

[wmf]

Just like some startups raise VC for "validation" instead of money, companies are now using Kickstarter for PR. And if it's successful, people will pay you for your PR campaign.