06/05/2012 11:33 am ET Updated Aug 05, 2012

Investors Losses Are Kickstarter's Gain

NEW YORK (CNNMoney) -- When entrepreneur Julia Hu presented her prototype of a vibrating wristband alarm clock to a group Silicon Valley tech heavyweights, their responses ranged from skepticism to outright disbelief.

"That was a charmingly quirky presentation, but I'm not sure," said Sean Parker, a serial entrepreneur and partner at venture capital firm Founders Fund. "I mean, is this a company?"

Hu's pitch, made at TechCrunch Disrupt 2010, didn't dazzle any of the investors on the panel. Almost laughing, Parker added: "I just have a hard time believing you're serious."

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