Apparently, Steve Wozniak has stopped participating in crowdfunding projects because he can’t see how the money is being spent. Among other things he said in an interview is this: “I’ve actually turned away from self-funding for now. Kickstarter and Indiegogo and those sort of things…You never get to see their accounting. You never get to see how they used your money. It’s not like a real open company.”

This makes me think of applying for and managing grants and donations. The funding sources want to see how their money is spent, and they get irritated if money goes to overhead costs rather than direct costs involved in moving the project forward. Many funding sources I’ve encountered put conditions on use of the funds, including reporting requirements. Excluded items can include overhead costs like marketing and office equipment.

That makes sense, because that kind of spending can become excessive, so funding sources want some kind of accounting. There are some who push back because groups like non-profits that depend on grants can be hindered by not being able to use money where they see the most need.

What have you seen that is a win-win solution, and how can it be applied to crowdfunding?