Jul 31, 2017 · 41m · how-i-built-this
Kickstarter: Perry Chen
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In this episode of How I Built This, host Guy Raz interviews Kickstarter co-founder Perry Chen about the unconventional eight-year journey to create the revolutionary crowdfunding platform. Chen reveals how a non-technical team built a values-driven, multibillion-dollar engine for independent creative projects while resisting traditional Silicon Valley hyper-growth pressures.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Guy holds 35.3% of the talking time here. How this is scored →
Guy as informed peer 2.4 Guest teaching 1.7 Guest disagreement 1.5 Guy pushing back 1.2
speaking balance: gold is Guy, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 27:04 Reframing the hardware policy restriction
Perry directly pushes back against Guy's claim that Kickstarter stopped allowing gadget prototyping, stating that framing is not entirely accurate.
Hardest push from Guy ▶ 18:15 Challenging Perry's nonchalance regarding riskGuy pushes back against Perry's relaxed retelling of their slow launch, asking directly if he is wired differently than normal people who would feel intense anxiety.
Biggest teaching moment ▶ 30:26 Educating on historical bottom-up patronage modelsPerry corrects Guy's flattering House of Medici comparison by explaining that oligarchic patronage is the opposite of Kickstarter's model, citing Walt Whitman and the Statue of Liberty.
Guy holds their own ▶ 17:45 Citing Indiegogo's launch timelineGuy demonstrates detailed research into the crowdfunding sector, noting that competitor Indiegogo had already beaten Kickstarter to market by 18 months.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Guy as informed peer | Guest teaching | Guest disagreement | Guy pushing back | Why |
|---|---|---|---|---|---|---|
| Summer Live Shows Announcement | 0 | 0 | 0 | 0 | Host monologue introducing live tour dates and framing the founding narrative of Kickstarter with a short teaser clip. | |
| Post-College Struggles and Day Trading in Manhattan | 2 | 1 | 1 | 1 | Guy asks standard biographical questions as Perry humorously recounts his post-grad gig day trading in Manhattan despite having zero financial background. | |
| The Origin Idea: Bringing Musicians to New Orleans | 2 | 1 | 1 | 1 | Perry details the initial spark for Kickstarter when trying to book Kruder & Dorfmeister in New Orleans, noting he had no desire to pursue a conventional corporate career. | |
| Returning to New York and Partnering with Yancey Strickler | 2 | 1 | 1 | 1 | Perry explains moving back to NYC, waiting tables, and meeting co-founder Yancey Strickler who was initially ambivalent about the concept. | |
| Drafting Blueprints with Charles Adler and Initial Funding | 3 | 1 | 1 | 1 | Guy asks about the detailed 100-page wireframe document created with Charles Adler and their first modest angel round from comedian David Cross. | |
| The Business Model and Enduring Slow Development | 3 | 2 | 2 | 3 | Guy presses on why they didn't rush to an MVP or worry about getting beaten to the punch; Perry explains they moved as fast as resources allowed. | |
| Mid-Show Break and Episode Preview | 4 | 2 | 2 | 3 | Guy highlights that Indiegogo launched 18 months earlier and asks if Perry is wired differently to handle uncertainty, prompting Perry to detail his emotional coping mechanisms. | |
| Launch Day, Early Projects, and Organic Growth | 2 | 1 | 1 | 1 | Perry describes launch day, early zero-fee projects like Drawing for Dollars, and Kickstarter's deliberate, linear early growth. | |
| Angel Funding, Modest Salaries, and Rapid Profitability | 3 | 1 | 1 | 1 | Guy asks about early angel capital and avoiding VC traps; Perry explains intentional terms with angel investors, low founder salaries, and reaching profitability within 18 months. | |
| Product Policy: 'Kickstarter Is Not a Store' | 3 | 4 | 4 | 2 | Guy asks if Kickstarter banned hardware prototyping under 'Kickstarter is not a store', and Perry corrects him, explaining it introduced review requirements and risk disclosures. | |
| Historical Precedents of Crowdfunding and Patronage | 3 | 5 | 3 | 1 | Guy compares Kickstarter to the House of Medici; Perry rejects the elite patronage analogy, educating him on historical micro-patronage examples like Whitman, Mozart, and the Statue of Liberty base. | |
| Values Over Profit and the Public Benefit Corporation | 3 | 2 | 2 | 1 | Perry articulates why Kickstarter limited its fee to 5% and reincorporated as a Public Benefit Corporation to resist pure shareholder wealth maximization. | |
| Stepping Down as CEO and Closing Reflections | 1 | 1 | 0 | 0 | Perry reflects on transitioning from CEO to Chairman; segment concludes with the 'How You Built That' interview with Crystal Gordon about the duvet clamp. |
Statements from this episode (20)
Perry Chen: Day trading provides no meaningful service despite liquidity claims
“At best, what I'm doing is neutral. I mean, I'm not selling somebody on anything, so the traders like to think that they're providing liquidity, like some great service, but you know, it's, you're doing nothing. You're shuffling some numbers from one computer …”
Kickstarter's core model originated from a canceled New Orleans concert
“I thought, what if the people that, Would want to come to the show could have a say in that. And if enough people could do that before a certain point, then the show could happen. And if not, then it doesn't. So that, that was it. That was the beginning.”
Perry Chen preferred making music in New Orleans over 70-hour corporate weeks
“This is why people work for 35 years and retire, so they can move to New Orleans and work on music. So, am I jealous of my friend who works 70 hours a week? No.”
Neither Perry Chen nor Yancey Strickler could code when starting Kickstarter
“I cannot code and I couldn't code, but I think I had a sense of what it should feel like. I know what I like, I know what I think feels good when I'm on a site, but from the deep technical stuff, No, that was not my background at all. Yancey probably had been …”
Comedian David Cross was Kickstarter's first investor after a 2006 meeting
“I had a friend of mine, and her cousin is David Cross, the comedian from Arrested Development, and many other, Mr. Show, and great stuff. And so she connected us, and we went and had a drink at a bar, and I talked to him about the idea, and a few months later,…”
Kickstarter raised approximately $120,000 across 18 months leading up to 2008
“It took us a year and a half, so from that point, probably from there to early 2008, we raised maybe a 120,000 dollars in a year and a half.”
Perry Chen: Traditional funding models force creators to compromise their vision
“So many things don't have access to funds. There aren't industries or investors or whatever set up around to fund things because the market might not be sizable enough. And then even the things where the market might be sizable enough that the deal you have to…”
Rival crowdfunding platform Indiegogo launched 18 months before Kickstarter went live
“In fact, 18 months before Kickstarter went live, Indiegogo, another crowdfunding site, was launched.”
Andy Baio joined Kickstarter as CTO because the founders couldn't review code
“One of the people we met was Andy Baio, who really helped us kind of Figure out what kind of technology we should be using, and helped us interview the developers that we would hire, and he eventually became our first CTO. That was tremendously helpful because…”
Kickstarter's founders told early investors they would never sell or IPO
“Going into it, we knew that we weren't building this to sell this, and we weren't trying to create a public company. And when we went out for investment, this was, you know, one of the first things we discussed with people.”
Chris Sacca invested personal angel money in Kickstarter's early funding rounds
“First of all, with Chris Zaka, it was angel money. It was their personal money.”
Kickstarter took money from only one institutional venture capital investor
“We did have one actual venture capital investor. Again, not that much money.”
Kickstarter achieved profitability within 18 months of launching the platform
“I think, you know, the first six months, not at all, no revenue. I think within a year after that, so probably within the first 18 months, we got in the black.”
Kickstarter added 'not a store' warnings and prototype rules to manage risk
“So we said, hey, you need to show where your prototype is at. You need to add the risks and challenges of this project as you see them. In the checkout process, we had Kickstarter is not a store, and we linked to some of our policies to let people know what di…”
Kickstarter refuses to offer special promotional partnerships or perks to large companies
“I think a lot of times big companies, they want to do a partnership, they want to sign a contract. That's, you know, we're like, listen, if you want to go do it, go log on the site. But if you want, like, some special stuff from us or whatever, I mean, that's …”
Kickstarter surpassed $3 billion in cumulative pledged project funding by 2017
“Recently, we passed the three billion dollar pledge mark.”
Crowdfunding removes the social friction of directly asking friends for money
“There was this social friction before that existed, and the model has been able to eliminate that, or even put it in a way that's socially positive.”
Kickstarter reincorporated as a Public Benefit Corporation in 2015 to protect stakeholders
“And then two years ago, we became a public benefit corporation, which is still a for-profit company, but it means that the obligations of the board and the executives and the company is to balance the shareholder interest with greater stakeholders, including t…”
Perry Chen: Maximizing shareholder profit is a poor fit for human society
“But really, if underneath the mandate is, at the end of the day, make the most money for shareholders, it's a really, it's not really a good fit for humans. And I don't think it's, It portends very well for society if this is what we accept as the only way to …”