Forget the money: Kickstarter turns Pebble into a platform

By now, you’ve probably seen the soaring funding numbers put up by Pebble, the e-paper smartwatch that has broken records as the biggest Kickstarter project to date with $4.7 million raised. It’s an amazing showing for the watch and another example of the power of crowd-funding platform Kickstarter. But what’s really cool for Eric Migicovsky, the man behind the Pebble watch, is not the money he’s able to raise. He’s more interested in how the Kickstarter campaign is helping create an instant ecosystem around Pebble’s app platform, giving it the kind of scale that is very hard to conjure up so quickly in the software world.
Platforms face a classic chicken-or-the-egg dilemma: developers won’t build apps until they know how big the opportunity is, but apps are often what sell a device. However, if a platform can attract support from a grassroots fund-raising service like Kickstarter and demonstrate real demand, developers will take notice and start to make great apps. That’s what’s happening with Pebble’s Kickstarter campaign; it has been able to skip some of the early growing pains of app platforms. Allerta, the company producing the Pebble watch, already has sold 38,000 watches and should be well past 50,000 when the Kickstarter campaign ends in 30 days. And that’s before regular sales begin. Pebble already has 32,000 visitors to its developer blog since the campaign launched a week ago.

Viable app platform on day 1

“When this many people get a product on day 1, that’s a huge market for apps,” said Migicovsky, a Y Combinator graduate. “That’s boosted us into a position of a viable app platform.”
My colleague Kevin Tofel has a good run down on the features of the Pebble watch, which works with both iPhone (s aapl) and Android (s goog) devices. It has an e-ink screen that can run for seven days and works with a smartphone to deliver SMS text messages, emails and Caller ID information and music playback. The watch will also support a developer SDK that allows developers to write applications and create watch faces for the device. The SDK will be available in August before the smartwatch goes on sale for $150 in September.
This is not the first time Migicovsky has tried to create an app ecosystem. With the InPulse watch, a Pebble predecessor that worked initially on BlackBerry (s rimm) phones, he managed to attract about 80 apps that worked with the device. That’s not bad considering he only sold 1,500 watches. Now, with many more Pebbles pre-ordered, it’s going to be an even more inviting target for developers, said Migicovsky.
“We’ll be selling a lot of watch faces, which will probably start at 99 cents. On day one there will be 50,000 users. I think developers can do the math,” he said.

Developers get a kickstart too

Migicovsky stands to gain by app sales, from which Allerta will take a typical app store cut of probably 30 percent. But it’s the prospect of making the watch even more useful through apps that is more satisfying. The funding is helping Allerta invest in more research and development, he said, which will mean an even more robust SDK for developers than what he originally imagined.
That is what is remarkable and unique about this Kickstarter project. While the artists and creators are usually the only direct beneficiaries of a successful Kickstarter campaign, the Pebble project has the potential to be a money maker for many other developers. Migicovsky said that’s a game changer in the hardware platform business.
“I didn’t realize this would happen but it’s totally obvious to me now that Kickstarter is great for building a community. The backers will now form the community that builds the apps or requests apps to be built,” said Migicovsky.