Presented at The Impacts of Civic Technology Conference in April, 2018 by Micah Sifry and Matt Stempeck.
By Micah L. Sifry
Ever wonder what happened to civic tech startups like Vote.com, Voter.com, Hotsoup.com, Speakout.com, Ruck.us, Jumo, ChangeByUs, VoteIQ, or Votizen? Or maybe you’re thinking of starting something new in civic tech and want to learn from past efforts that didn’t succeed? As part of the work on the Civic Tech Field Guide, we’ve been fleshing out a section called the “graveyard” where civic tech projects that had funding, users, press attention and traction–but no longer exist–may be visited, remembered and hopefully learned from. In this piece, Field Guide co-curator Micah L. Sifry offers some fresh news about some recently deceased start-ups, and some larger lessons from graveyard’s denizens. Cross-posted from Civicist with permission. Slides are here.
Sometime in June 2018, the civic tech crowdfunding platform Citizinvestor quietly shut down. The start-up had tried to fill a tricky niche in the crowdfunding ecosystem, connecting bottom-up ideas and funding for local neighborhood projects with the municipal government authorities needed to make those projects viable. Think of it like a Kickstarter for civics, with a focus on projects with local government support. On its launch back in mid-2012 Fast Company gave Citizinvestor a nice write-up, as did our old site techPresident. The platform also got some media attention when a bankrupt town, Central Falls, Rhode Island, started using it to try to raise money to buy materials to help clean up its main public park. While that crowdfunding campaign was underway, the users independently organized a clean-up for the park and 100 people showed up out of a population of less than 10,000.
Over the course of its run, Citizinvestor hosted a total of 76 projects, of which just over half, thirty-seven, got funded. A total of $339,315 was pledged to projects on the site, of which $282,737 or about 83%, was collected and disbursed. About 1,400 people gave to a Citizinvestor project, making an average contribution of a little more than $300 each, according to a spreadsheet the company’s co-founder Jordan Raynor shared with me. Typical projects were modest efforts like a tree planting or park improvements like a dog run or a playground. Raynor and Tony DeSisto, Citizinvestor’s other co-founder, were the two full-time staff, and they also employed a few salespeople who worked on commission and some developers who worked part-time. They paid themselves by taking a 5% fee from successfully funded projects and another 3% for the Amazon payment service. An angel round of $150,000 gave Citizinvestor its first boost in early 2013, according to Crunchbase, and another $100,000 in a seed round came in two years later.
Citizinvestor had energetic leadership—Raynor worked in the Bush White House’s office of political affairs and did a stint as a VP at the Republican tech firm Engage LLC, while DeSisto was the vice chair of the city of Tampa’s citizen advisory budget committee. And it had a timely idea. But despite that, Citizinvestor is now in the civic tech graveyard. It is buried there alongside dozens of other start-ups that managed to get past being hobbyists’ side projects and raised money, earned press attention and garnered users, but still ran aground. What went wrong? DeSisto says he and Raynor decided to shut Citizinvestor down because “it didn’t scale the way we wanted and couldn’t sustain itself.” Even before this decision, both co-founders, he notes, had already moved onto the other projects and weren’t able to give more guidance to the CEO they hired.
Citizinvestor also took too long to figure out who its real customers might be. DeSisto says, “We overestimated the pace at which it would scale, and needed more seed funding to build to capacity. We also introduced our white labeled product too late.” That was Citizinvestor Connect, which he says four municipalities bought and which offered a more interactive approach for proposing projects and a better back-end for municipal staff helping to manage them. “While we were getting traction with municipalities, we were a long way off from 5% of project being enough to bring in any substantial revenue. We needed either, funding to get us to the next phase, or an additional revenue source, like the white label product, or more likely both to be successful.” He added that not launching the Citizinvestor Connect platform sooner was “a big mistake” because in retrospect “this was our most likely path to success.”
It’s wonderfully helpful to get this kind of candor from founders. While Citizinvestor was up and running, Raynor shared much rosier metrics. Back in 2013, he told Sam Roudman of techPresident that the company was working with nearly 100 municipalities to help push projects, and in their first year of operation about 70% had been funded. In fact, according to the internal project spreadsheet Raynor gave me, in its first year (from September 2012- September 2013) Citizinvestor formally hosted 19 municipal projects from 16 cities, and 13 of those 19 (68%) were successfully funded, to the tune of just under $80,000 in all. Considering that Raynor and DeSisto were only paying themselves 8% of that total, at that time they were very bravely anticipating growth that they never achieved. (In their next full year, Citizinvestor projects took in $77,000, and in its third and last robust year of operation, $106,000.)
Failure in tech is not unusual. As inventor Thomas Edison famously said about all his efforts to develop a storage battery, “I have not failed, I’ve just found 10,000 ways that won’t work.” According to a Harvard Business School study of 2,000 VC-funded tech start-ups that received more than $1 million in funding between 2004 and 2010, 75% failed to return their investors’ capital. In February 2018, CB Insights did a scan of more than 100 post-mortem posts by failed start-ups and reported that the top reasons given for failing were “no market need” (42%), ran out of money (29%), not the right team (23%), got outcompeted (19%), pricing or cost issues (18%), their product was too hard to use (17%), poor marketing (14%), bad timing (13%), lack of focus (13%), a bad pivot (10%), a lack of passion (9%) or a failed expansion (9%).
And so it should not be a surprise that the field of civic tech is also littered with failed start-ups, projects and tools. For the last six months, as Matt Stempeck and I have worked to curate and expand the Civic Tech Field Guide, we’ve been keeping track of civic tech failures, in the hopes of learning more about what didn’t work, to help the field better understand what does. (You can find our working list of about 70 civic tech failures under the “graveyard” tab of the guide.)
Sometimes, as in the case of Citizinvestor, finding answers is as easy as emailing an organization’s founders and asking them to explain what they think went wrong. Sometimes, founders will share their own postmortems. For example, you can read about why the collective action hub Carrotmob shut down and how insights from its failure now infuse a related start-up, Moneyvoice; or why civic tech powerhouse mySociety closed Pledgebank, despite the vibrancy of the project (the quick reason is because other platforms like Groupon were doing a better job at providing the same service, and mySociety needed to concentrate on other priorities). Intertwinkles, a collection of open source tools for helping small group decision making that was the extension of MIT graduate student Charlie Detar’s dissertation work, closed down when Mozilla made changes in the Persona codebase. Detar writes that that would have required him to do a lot of unpaid work upgrading his software tools, but he didn’t think it was worth the effort given how little those tools were actually being used by the groups they were built for. Randy Meech, the CEO of open source mapping company MapZen, offered his thoughts on how much of the company’s software was built to last beyond its possible death (which occurred at the beginning of this January) while one of its developers, Dan Phiffer, had a somewhat more skeptical take on the same topic.
Other times, a start-up effectively shuts down when its founder and related talent get acqui-hired, and their farewell messages don’t shed much light. See for example what Colin Mutchler, the founder of Louder (originally Loudsauce), a crowdfunding platform for small-donor funding of political advertising that had backing from Huston Hedinger, Matter and the Knight Foundation, had to say about his company’s acquisition in 2015 by Change.org. He writes, “All of our work with Louder has given us the expertise to understand the motivations and needs of the cultural organizers and amplifiers of our times, and we are so excited to help accelerate the impact of such a transformative civic platform as Change.org.” Change never launched a product or service for its petition-signers to crowdfund political ads, though it now does invite petition organizers to use the platform to raise funds to support their campaigns.
Sometimes, the reasons a start-up or project fails remain murky. For example, in 2013 the Knight Foundation gave the TED conference a $985,000 grant to help develop TED.com into an “action platform,” to help channel people moved by a powerful talk into taking meaningful action on the issues being raised. A few press releases and posts about the grant mention workshops convened by TED to tap the expertise of “business leaders, political activists, artists, marketing gurus, and tech whizzes” where “these big thinkers brainstormed guiding principles and tactics to develop nonprofit online action platforms, including TED.com.” But the TED action platform never appeared.
Asked about this, a spokesman for TED responded by email:
“A few years back, the idea of building an ‘action platform’ for TED made a lot of sense. Imagine taking all these ideas and giving people a way to actually do something measurable with them? Powerful stuff! We’ve long understood and loved that web development is not a straight line, and we experiment with several new projects at any given time. So we embarked on a partnership with Knight Foundation to see if we could build such a mechanism on or inside our website, TED.com.
At the time we received that grant, we were in the midst of a full website redesign. TED Talks had exploded in popularity after we first experimented with putting TED Talk videos online for free in 2006, but we were still using a website from our old days. Our priority was building a site that could house thousands of online videos. The challenge of launching that redesign with a small team of engineers meant that we weren’t able to implement our action platform ideas on the site at the launch. But those ideas continued to incubate and contributed indirectly to the launch of a much more ambitious ideas platform a few years later called the Audacious Project which has ended up catalyzing more than $400m in funding for bold projects.
TED’s main mission is to spread ideas and to trust that those ideas will influence how people think and thereby eventually lead to impact. But we’re also committed to exploring more direct ways of turning ideas into action. The Audacious Project is one such effort. There may be more in the near future. The investment that Knight Foundation made was a catalytic chapter in our journey and we’re grateful for their vision. It didn’t turn out exactly as we all imagined at the time. It actually became something better.”
As many of these episodes show, there are always going to be multiple answers to the question of why a civic tech start-up or project may fail, and extracting more clarity and perspective from founders, employees and other stakeholders is an ongoing challenge. In a slightly more ideal world, it would be common practice for civic tech companies and nonprofits to share more “blameless postmortems,” as engineer John Allspaw once put it, so the whole field can better learn from mistakes. In a slightly more ideal world, funders would be more tolerant of failure, and maybe they’d even share more about their own errors of judgment in who they’ve backed and what they’ve learned.
It’s worth noting that there are plenty of beneficial effects even when a project fails. As Christopher Csíkszentmihályi and Gemma Rodrigues of the Madeira Interactive Technologies Institute point out in their new in-depth report on Social Tech Ecosystems in Sub-Saharan Africa, “even aborted initiatives often provide some services and returns on investment. They might train future founders, teach employees to develop future products, or pivot into new approaches.” They add:
Individuals, organizations and even governments in the [tech] ecosystem have learned from failures. More fertile and dense ecosystems, like Kenya, are filled with experts who have seen many initiatives thrive or crash and they have a very detailed and nuanced understanding of why. The death of organisms is a hallmark of a thriving ecosystem: It is called food and fertiliser.
Working for Transparencee.org, Alina Ostling recently undertook a study of civic tech failures in Central and Eastern Europe, the Balkans and Russia, speaking to experienced practitioners from the region. Her conclusions:
The evidence from the field shows us that many civic tech tools fail. Sometimes this has to do with the technology used and the lack of appropriate tech skills to apply it, but most of the time, it boils down to the human element. Organisations are struggling with involving users into the design and implementation of products, and of maintaining a fruitful relationship with public officials, who are often the key data providers or the target of the project. Surveys show that only a minority of civic tech organisations do any user research before choosing a tech tool and even fewer test the tools with potential users. At the same time, the majority of them expect easier buy in from project’s stakeholders and users, than what happens in reality.
With all that as preamble, here are some more general gleanings from the roughly 70 examples of civic tech failure that we’ve collected so far in the Field Guide’s graveyard.
1. Early success at raising money does not correlate with ongoing success at engaging users. Projects like Jumo, ChangeByUs, VoteIQ, Vote.com, Voter.com, Hotsoup.com, Speakout.com, Ruck.us and Votizen all had ample early funding. Cumulatively, those nine raised more than $20 million. Civic engagement app Brigade, whose founders bragged about understanding the “graveyard” of past efforts back when they launched in 2014, had $9.3 million in support from Sean Parker and other VCs at its launch. It’s still limping along, but barely. If you build it, even if you have a catchy URL, users don’t come. Which gets to our next point…
2. There are some civic “needs” that users don’t have intensely or frequently enough to support a business or nonprofit dedicated entirely to serving those needs. One of them appears to be a generic social network for voter information. As the latter seven of the failures mentioned above show, no one seems to be interested in a nonpartisan hub where you can learn how your representatives have voted, look up information on bills, and debate the issues with strangers. For the first two needs, Congress.gov and GovTrack.us apparently suffice. For the latter, politics junkies go to watering holes where they hang out with their own kind (see DailyKos.com or RedState.com). Politics is partisan, and it’s complicated; the casual mid- or low-information user isn’t likely to care enough to make a generic voter information site viable. (For an excellent discussion of these issues, see also GovTrack founder Josh Tauberer’s 2015 post, “So You Want to Reform Democracy.”)
To give another example: ElectNext, a hub for information on voting choices, had a couple million visits in the weeks before the 2012 U.S. election as people turned to it to figure out which candidates matched their personal issue preferences. But that surge of interest quickly dwindled; soon after the site’s founder Keya Dannenbaum pivoted to being a provider of tailored political content to news-sites. (And then that company, Versa, was acquired by Change in another talent acqui-hire; Dannenbaum later went to work for the Omidyar Network’s governance and civic engagement team, until she was poached by Facebook’s civic engagement team! Go Keya!)
3. A number of promising civic tech tools have failed mainly because their owner decided to focus on more promising projects in their portfolio. Examples include Pledgebank (closed, as noted above, by mySociety in part because it was overtaken by other crowd-organizing platforms like Kickstarter and Groupon) and OpenCongress (closed by Sunlight Foundation after years of development with its traffic redirected to GovTrack, which has a very similar raison d’etre). Both platforms had plenty of users, but in both cases their sponsoring organization decided another entity was already performing the same general service well enough. More is not necessarily better.
Years ago, when we were running Personal Democracy Media, we decided not to continue promoting our debate crowd-sourcing site 10Questions because we weren’t satisfied with the level of engagement we had managed to generate around state and congressional candidates in the 2010 mid-term cycle, after having a larger level of engagement two years earlier. In 2008, the CNN-YouTube debates had given a burst of free publicity to 10Questions and not only did thousands of people help parse hundreds of voter-generated questions, voting a total of 127,000 times in all, six presidential candidates (including Barack Obama) formally responded to the top-asked questions. In 2010, we had a much harder time garnering engagement around a few targeted congressional and state races, despite having more local media partners. Timing matters.
4. Hubs for solving collective action problems often fail. In addition to Citizinvestor, there are nine others listed in the field guide graveyard. And what these failures appear to have in common is they asked people to take action together in ways that were too complicated. Carrotmob sought to form motivated crowds of consumers to pull local merchants toward higher standards of social or environmental performance, Votizen tried to create a social recommendation system for answering the question “who should I vote for.” Equally important, these efforts were competing with simple, general purpose platforms like petition sites or crowdfunding tools like GoFundMe that have much lower barriers to entry. Would-be developers of collective action hubs also need to ask themselves: Why would people use my specialized platform if a simple hashtag campaign will do the trick?
5. Hyper-local forums for sharing community news have often failed for a complex set of reasons. One may be that some of them, like Everyblock or OutsideIn, predated the rise of mobile smartphones, so even though they had millions in early investment, they were too expensive to scale. More recent attempts at hyper-local news, like Patch or Blockboard, may have been swamped by Facebook and Twitter’s overwhelming presence. Why go to the specialized news site if you can just read the gossip surfacing in a Facebook group for your town or zipcode? Still, the success of SeeClickFix, which recently topped a million users, or Vermont’s Front Porch Forum, which has 60% of the state’s households on board, suggest that there may still be sustainable, even modestly profitable, path for well-moderated online community news sites.
These are just a few gleanings from looking at civic tech start-ups that have kicked the bucket, and in no way a conclusive survey of every idea that didn’t make it. Missing from the field guide graveyard are the projects that never even got off the ground because their would-be creators didn’t have the right connections to funders, a hidden effect of the structural barriers that have kept many, especially women and people of color, from putting their ideas into motion. Hopefully, as the field of civic tech continues to grow and mature, we will continue to see many new start-ups and pivots, more entrants and leaders representing previously marginalized groups, and a greater willingness to collaborate and share knowledge of what works, what’s needed and how to make tech work for the greater good of all.
[Full disclosure: The Knight Foundation is supporting the development of the Civic Tech Field Guide, and also backed the 2010 development of 10Questions.com.]