Author Topic: Trials & Tribulations of Kickstarter  (Read 7742 times)

Jon Shafer

  • Lord of the Forest
  • *
Trials & Tribulations of Kickstarter
« on: February 11, 2013, 08:53:20 PM »



This post originally began its life as a humble comment on our Kickstarter page, but after writing for a bit I realized it would be even better as a full-blown article!


What Do You Have to Consider With a Kickstarter Campaign?

Many people don't realize creators ultimately end up with a fairly small slice of the Kickstarter pie. You can immediately cut 20% off the top due to processing fees and failed transactions. Then there's the cost of fulfilling rewards, marketing (yes, it's important), both planned and unplanned contract work, licensing multiple software packages - the list goes on and on.

Oh, and as with everything in life, the taxman always wants his share. It's particularly rough if you make a large amount of money from your campaign, and then nothing for the next two years, as you'll be taxed at a much higher bracket than you would if the same amount of revenue had been spread out. Suddenly that amazing $1,000,000 Kickstarter haul starts to look a lot more like 300 or 400 thousand. Yikes!

In retrospect, I'm very glad I did extensive research on all of this ahead of time. I can see how teams end up in big trouble by overestimating the actual funding they end up with, either due to a lack of research or worse, just sheer excitement. The cost of physical rewards can really sneak up on you, and this is why we've been so conservative about what tiers we're offering for ATG and the $ figures attached to them. This is a sad tale, and I imagine it will be one that's increasingly common. It's particularly depressing because I also have a personal connection with that project.


Kickstarter & At the Gates

In case anyone was wondering, yes, I have done my homework! $40k is not a large budget for a complex strategy game, but its possible because I know exactly where every cent will eventually end up going. Having a small, very talented team comprised almost entirely of your friends really helps! (Thanks again, guys!)

That's not to say success is guaranteed - for us or anyone else. There's risk with every large project. This is especially true for games, which can be both beautiful and well-engineered but end up being zero fun to actually play. It honestly surprises me how optimistic people are about the probability of most Kickstarter projects following through on their claims. The rate of failure here is likely to be in the same ballpark as traditional games development... and that number ain't good. It might even be worse, as large companies have staff paid to ensure projects do succeed!

This is why I welcome and even encourage folks to challenge us on not only what we're doing with ATG but also how we plan on doing it. (Yes, that is an open invitation - fire away, I promise I can take it!)

In my personal opinion, Kickstarter is neither charity nor even patronage. It instead serves as a means for customers to pre-order products directly from their creators, providing the funding necessary to develop innovative concepts. Patronage can be a part of that, but only when the chances of ending up with something at the end are very high. Accordingly, there's no way I would launch a Kickstarter campaign without having a fully-playable prototype ready to show off. In my mind you just have to be able to demonstrate what you're actually building, regardless of your track record.

This is also offers a built-in advantage to the developers. We're already about halfway down the road of development, and much of what remains is simply polish work. Not bad!


The Future of Kickstarter

I often wonder how Kickstarter will change once the first big failures hit. I have great faith in the model and believe it's how a significant chunk of future PC games will be funded. There are a large number of people who agree with me on this. But there's no guarantee the larger community will maintain that opinion after throwing thirty, two-hundred or a thousand dollars at vaporware.

What about you? If games you've contributed to go down in flames with nothing to show for it, will it lower the chances you contribute to future projects? And what risks associated with ATGs development concern you the most? Let me know what you think!

- Jon
« Last Edit: February 11, 2013, 09:06:54 PM by Jon Shafer »
If you have any questions, please send me a private message here on the forums or an email at [Contact@ConiferGames.com]. Thanks for your support!

Re: Trials & Tribulations of Kickstarter
« Reply #1 on: February 12, 2013, 12:46:54 AM »
Hey Jon. First off, I really appreciate how open you've been about every aspect of this campaign. Of course you haven't told us every feature of the game, but that's what future updates are for (and we can always ask!)

I am ALSO very glad you did all that research, because it certainly seems you know what you're doing with the business side - which bodes well for the design of the game. If you can't even design a good business plan, what hope do you have to design a much more complex 4X strategy game? Not to mention it proves how serious you are about this.

Aside from that, I personally appreciate your attitude towards user feedback. Some kickstarters are more 'only backers can have input', which in my mind is REALLY limiting - although I can pay a single dollar just for the right to say I'm a backer for this! - but the sheer fact that this forum exists as opposed to just the kickstarter page proves that you're willing to listen to non-backers, which I think is important. I also think the emphasis on alpha/beta/design doc access in the kickstarter rewards also emphasize the idea that you want a lot of player feedback.

As an aspiring designer, this is essentially the best chance I can get to practice BEING a designer without actually making a game - especially since I personally am more interested in larger, deeper, AAA-style systems than the admittedly subtler art of designing a game like, say, Journey.

Basically, what I'm saying is that this approach allows you to essentially crowdsource if not the design than certainly the playtesting aspect of the game - which is good, since playtesting is how you find out what makes a game 'fun' instead of 'good', since game design is still an extremely subtle art.

Anyways, I'm going to donate my $1, and I'm actively trying to figure out how I can contribute more - not just for the sake of this game, which also sounds amazing, but also as an opportunity for me to hone my own talents, and I really appreciate you allowing that opportunity. I mean, FULL access to the design documents? That's amazing, and not something most kickstarters would allow, especially not at such a 'relatively' low tier. For me, getting to name a few things in the game pales in comparison to the opportunity the lower options provide! (Although I'm not short on names. "Mountains of the Moon/Sun" and "Aldowinium" being my names for a mountain range in one of the barbarian areas and Aldowinium obviously being a roman town.)

-- Aldowyn (should go see if this forum supports sigs, it should!)
Game design is the fusion of art and structure, the domain of the Architect.. - me, just now.

Proud owner of a digital hug and official backer of At The Gates.

Re: Trials & Tribulations of Kickstarter
« Reply #2 on: February 12, 2013, 12:55:04 AM »
Thanks for all the info, Jon.

As a generally low-money backer of Kickstarter projects, I don't think I need to seriously evaluate things how an investor would. Even at higher levels, maybe, because there's not an expectation of monetary return. There's the game and the rewards, but the return is most likely clearly worth less than what you contribute. Kickstarter is exactly what you said--a way for customers to preorder things they want.

Personally, I'm not worried about risks when the project looks to have potential. With ATG, because of the people involved and the prototype, I'm basically just worried that I won't get to play the game. But I'm more worried that I'll never see a Mirror's Edge 2, and that's got EA behind it.

I view it a bit like donating to a political campaign or a nonprofit. Maybe the foundation doesn't cure world hunger, but I contributed to people doing work that I support.
--
Brian Colella
@BitrateBrian

Re: Trials & Tribulations of Kickstarter
« Reply #3 on: February 12, 2013, 01:29:20 AM »
Hi Jon,

thanks for all the background info on how you see kickstarter.
I am 43 and have a book case full with games that came out over the last 20 years. About half of them I still play today, the other half I played once or twice and gave up because they were not what I expected.
So even the big developers can/will disappoint, you just have to be around long enough.
On Kickstarter I expect the same. I currently back 10 games - including ATG - and I hope that five will be worth it.
Of course I would like all of them to be fantastic, otherwise I would not have backed them, but as someone who plays since the late 80's of the last century :-)  I have no illusions either.
I usually give $35 per game, only for "Elite Dangerous" I gave $75 (nostalgic reasons) and I do it for two reasons.
First, Kickstarter gives me the opportunity to get the games I want to play but big developers don't do, or think that there is no money in it. I like my old turn based 4X games, the space sim and as they say, they don't make them as they used to anymore.
And second, my money creates jobs. If one of the games I backed really makes it big, and the developer expands, creates more jobs, that would be a good day for me.
« Last Edit: February 12, 2013, 01:39:23 AM by Gerry10 »

Re: Trials & Tribulations of Kickstarter
« Reply #4 on: February 12, 2013, 05:58:11 AM »
Quote
In my personal opinion, Kickstarter is neither charity nor even patronage. It instead serves as a means for customers to pre-order products directly from their creators, providing the funding necessary to develop innovative concepts.
I'm a little confused how the higher levels of the kickstarter fit into this viewpoint? Why have an option of, say, $5,000, when you would expect people to simply pre-order the game at $25?
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Jon Shafer

  • Lord of the Forest
  • *
Re: Trials & Tribulations of Kickstarter
« Reply #5 on: February 19, 2013, 02:12:06 PM »
It's great to hear that you guys would stick with Kickstarter, even after the first few failures start to hit. I very much believe that this funding model is the future for PC gaming, and want to see it remain strong!

Quote
In my personal opinion, Kickstarter is neither charity nor even patronage. It instead serves as a means for customers to pre-order products directly from their creators, providing the funding necessary to develop innovative concepts.
I'm a little confused how the higher levels of the kickstarter fit into this viewpoint? Why have an option of, say, $5,000, when you would expect people to simply pre-order the game at $25?
Good question. For me it's a question of value, but I suppose that saying Kickstarter should be solely a pre-order system is not the best way of phrasing my feelings towards the model.

I've certainly kicked in to a few projects, but my perspective on Kickstarter is mainly that of a developer, as someone who is receiving money from contributors. Creators have a responsibility to their patrons, and the trust they're willing to grant should not be taken lightly.

I see many projects where I say to myself, "there's no way that can be done, at least with the time and budget they're talking about." This sort of recklessness is bad for everyone, as the inevitable setbacks make potential supporters more leery, which obviously has a negative impact on the ability for other creators to utilize the platform. And with fewer projects being successful, that comes back around to hurt the public as well.

- Jon
If you have any questions, please send me a private message here on the forums or an email at [Contact@ConiferGames.com]. Thanks for your support!

Re: Trials & Tribulations of Kickstarter
« Reply #6 on: March 19, 2013, 04:10:44 PM »
Hmm would I continue to back projects even after high-profile failures and/or projects I've backed failing or just being eventually a bit rubbish? 

Absolutely yes, and I think Gerry10 was pretty spot on, I've been playing games for a long time, have 100s of titles lying around and am all too aware of how easy it is for games to turn out not-so-great, and have watched (and am sadly still watching, The Last Guardian what has happened to you...) plenty of projects stumble and fall during development, so I'm quite aware just how fickle this business can be, at least so far as someone on the 'outside' can be.

I do agree tho that the number of projects either genuinely underestimating the resources they'll need, and/or somewhat overselling the end product in their excitement to get everything going will lead to some harsh bumps for people.  The bubble is growing right now for Kickstarter and similar sites, a few headline-making failures are bound to come along sooner or later and scare alot of people away, possibly because they've been burnt once, or more likely because they won't look at WHY something failed, and just dismiss the whole idea as silly and too risky.

I just hope that afterwards, there's still enough of us around that get the risks, and are willing to throw a few /$/whatever at projects to make things happen, I totally agree with Jon that crowdfunding should be a notable part of the future for games development, especially as the large established publishers become ever more risk-averse.

Re: Trials & Tribulations of Kickstarter
« Reply #7 on: March 20, 2013, 05:37:00 PM »
I never considered Kickstarter anything more than 'taking a punt'. Ultimately you aren't buying a product but the idea of a product. I try to find out as much as I can about project before backing it. Knowing Mr Shafer's work on Civ sold 'At the Gates' to me.

Re: Trials & Tribulations of Kickstarter
« Reply #8 on: March 26, 2013, 01:26:53 AM »
I'm not a tax lawyer or CPA, but I do know that there is no statue saying you have to claim all the Kickstarter money as revenue until you deliver the product.  There is a lot of different option on how Kickstarter and tax interact.  You have to pay them, but many experts will tell you not to claim the revenue until you delivery the product.  Please, get some expert options and don't over pay the tax man.

Good Luck!  I can't wait to play.
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Re: Trials & Tribulations of Kickstarter
« Reply #9 on: March 26, 2013, 03:24:14 PM »
I actual expect that up to 50% of the projects I backet will be end in something I dont like but hope for a ebther hit rate with my backings.
What get me angered and maybe bring me to leaving KS is when the price of the game is already lower on release then what a KS Back have payed.
As the KS Backer have the risk to never get a product at all or a product they dont like in addtion that they also have a lost in interest rates because they pay fare ahead of the release.

Jon Shafer

  • Lord of the Forest
  • *
Re: Trials & Tribulations of Kickstarter
« Reply #10 on: March 26, 2013, 06:06:03 PM »
I'm not a tax lawyer or CPA, but I do know that there is no statue saying you have to claim all the Kickstarter money as revenue until you deliver the product.  There is a lot of different option on how Kickstarter and tax interact.  You have to pay them, but many experts will tell you not to claim the revenue until you delivery the product.  Please, get some expert options and don't over pay the tax man.

Good Luck!  I can't wait to play.

Conifer has both an accountant and a lawyer, so we've got those angles covered. It is a bit of a grey area, but as with most things it's better to be safe than sorry.

- Jon
If you have any questions, please send me a private message here on the forums or an email at [Contact@ConiferGames.com]. Thanks for your support!

Jon Shafer

  • Lord of the Forest
  • *
Re: Trials & Tribulations of Kickstarter
« Reply #11 on: March 26, 2013, 06:08:35 PM »
I actual expect that up to 50% of the projects I backet will be end in something I dont like but hope for a ebther hit rate with my backings.
What get me angered and maybe bring me to leaving KS is when the price of the game is already lower on release then what a KS Back have payed.
As the KS Backer have the risk to never get a product at all or a product they dont like in addtion that they also have a lost in interest rates because they pay fare ahead of the release.

I can definitely see that being frustrating. I obviously can't say this is true of all cases, but there are definitely times when the price point you had planned on has to be thrown out due to circumstances outside of your control. If you have a publisher or even an important distributor (e.g. Steam), they have some (or on some cases, all of the) say over that. But as with everything else related to Kickstarter, transparency should be the name of the game. If something like that happens with AtG I'll be sure to let you guys know. Well, unless I'm contractually obligated not to. In which case, you guys will be able to connect the dots for yourselves. ;)

- Jon
If you have any questions, please send me a private message here on the forums or an email at [Contact@ConiferGames.com]. Thanks for your support!