Are We Consumers or Investors in Crowdfunding?

I think this is the starting point of the conversation. Because, I believe that what we should expect is different between the two and often people don’t consider that. When I say people, I mean both backers and the project creators themselves.

According to Kickstarter, and I believe Gamefound as well, we are investors in the project. This is important to note because it does not mean that we deserve anything more than the project creators best attempt to turn out a product. If they fail, well, our investment failed and we don’t have recourse.

On the flip side, a lot of backers and project creators, treat the backing as being a consumer only. If we are consumers only, we deserve a refund if they can’t fulfill. We pre-order something and we should have the ability to cancel a pre-order if we decide that we want the newer shinier thing.

However, by the letter of the law, crowdfunding has us not as consumers, though we will – most likely – get a product at the end. We are investors in what the company is doing, whether it is a bigger company like CMON or a small company that’s launching their first game ever. By that, they do not owe us a product.

What Are We Owed Then?

This is interesting, because by the nature of investing, we aren’t really owed the product. The project creator is promising us one, but we aren’t owed it. And we might need to pay in more for our investment to get that return, the game, from it. And that is kind of lame. I want to get my product, so you do. Thankfully most board game projects deliver, albeit maybe late or costing more.

However, since we invest in the game and the project, we should expect some things. Mainly, I expect good communication on the status of the project. Jesse from Quackalope did a very good video covering this.

But I want to talk about it more as well. Because I expect good communication. And I think what that means can vary from person to person. And for a project creator, it might not seem that people are reading your updates. Here’s a secret, most people aren’t and that is a good thing.

Communication

I expect consistent communication once the project is done. Let’s make it simple, pick a day of the month, the 1st, last day, 15th, whatever day you want, and give me an update that day. Even if it’s just a thank you for backing message with a little of an update on development, that’s great. In particular, a thank you and some pictures, I will love that.

What I don’t want is no message for four months. Then a short message, maybe a picture, and letting me know that shipping has doubled. I want to know shipping has doubled, but that shouldn’t be the only reason for sending me a message. If shipping is doubled, I want you to link to an article about the shipping crisis. And I want to know what if anything I need to do about it. But I also want the benign updates that things are progressing.

But People Aren’t Reading My Content

Now, that is just fine that they aren’t. I know it might seem wrong but you don’t want people reading them, you just want people getting them. If people are getting an update, they will see the e-mail or notification for it. Then they will know that things are progressing and skip what you wrote. Sending out the communication is about what it says, for some people, but also to reassure people you are still working on the game.

If you send updates sporadically now people will assume either production is starting, shipping is starting, or something has gone wrong. And people will read those and be primed to be frustrated when something is going wrong. Also, more people read it and more people are frustrated. If you put it out normally, even if announcing a delay, people feel like you are staying on top of it.

But I Don’t Have Much to Say

Again, that is fine. I invest in your project because I like the idea of it. But also, I invest in your project and your company. The point of the message is to keep your investors happy. And you want to keep two groups happy. First is the group that always complains, it’s a loud but small group. The second, also small, is the group who will defend you.

If you don’t send messages, you lose that second group. I am willing to go to bat for you and for my investment, because I invested in you, if you keep me informed. Instead of that, I will be critical of you if you do not send consistent messages. For example, I still kind of defend Grimlord Games, I understand it is not their fulltime job. But they do not send consistent updates, they are well delayed at this point. My willingness to defend them is reduced because they do not communicate.

On the flip side, when Nemesis Games sent out a message asking for more support for shipping, I will defend them. I understand that shipping is crazy, and because they communicate now I am willing to give them more grace. Same with Creative Game Studio. Even though they ran into issues with shipping and how things are being charged, they keep communicating.

So Is There More?

Honestly, it is all about communication. If you show that you are being responsible with my investment, setting aside money, building in margin, and communicating success and struggles that I need to know, I don’t need to know all of them. I feel like my investment is in good hands.

Yes, behind the scenes, you need to know what you are getting into. And I expect that before going into your crowdfunding project that you have a plan. If you don’t, if you don’t have plans for shipping, for production, if you don’t have estimates, you aren’t ready. And as Quackalope talks about, it is hard to make money on a first Kickstarter or Gamefound campaign. So plan contingency money, plan not for everything that goes wrong, but plan to communicate when it does.

It is important to keep it moving forward, and it is important to keep communicating. It might feel like added work, something you don’t want to stop work on the game for. But just a two paragraph message with a picture of playtesting, or an update that says what you are working on. I keep on harping on it, but that is what I expect as an investor.

Finally, yes, I expect to get a product at the end. And whenever that end might be. But if for some reason that can’t happen, I expect to know why. And if it is because everything costs 2000% more than when you ran your campaign, I will try and understand. It sucks, but things happen, and I want to be understanding, but that means I need to know through the process. And hopefully, eventually, I receive that product.

What do you expect from a crowdfunding campaign? Do you see yourself as a consumer or investor?

Send an Email
Message me on Twitter at @TheScando
Visit us on Facebook here
Support us on Patreon here

What is Kickstarter?
Starting out with the basics here, but Kickstarter is a crowdfunding website. What’s a crowdfunding website, it’s a site where someone asks for money to help fund a project, that could be something like Go Fund Me with helping someone with medical expenses or whatever need they might have, but on Kickstarter, you’re almost always Kickstarting a project that is going to create some sort of end product. It might be a play, it might be a comic, a chair, a video game, or, as I’m going to be talking about board game or an RPG. Normally, when you help fund something, the company or creator gives you something in return for helping them.

How Does a Project Work?
I’m going to be tackling this from the consumer side, I’ve never run my own kickstarter, and I doubt I ever would or will. But, the creator makes their project, so they create a video (ideally), and write up information on the game, showing images of prototypes or of what they are planning on the components looking like. They explain how the game works, what sort of game it is, and why you should help them fund it. They also talk about what shipping costs might be and what they could see as risks for their campaign so the people who fund them know what they are getting into.

The final big thing they create though is the reward levels and funding level. These are how much they are asking people and how much money they need for it to actually happen. For example, if they think they can make the game that the whole cost of production is $20 but they need to 2,000 people to back them to get that production cost, they can make their funding goal $40,000. And there would be a reward level of $20 where people can back them and get a copy of the game as a reward. But what is more likely to happen is that production costs $20, so they offer a reward level of $30 for the game, because they need to pay themselves and kickstarter takes some of it, and they set their funding goal at $30,000. The reason for that is that while they want to hit 2,000 people, they can go over their funding goal, and if they do, more people are apt to back it, because they know the project is happening, and that’ll help them get to 2,000 people.

Then, with the Kickstarter up and running at kickstarter.com, they wait through their campaign, however many days it is, and that’s where we step in as the consumer. I look at the page, decide if it’s a game that I find interesting, and then if I do, I can back it. Now, maybe I just like the idea, but I don’t want the game myself or I know the creator of the game or like their company, whatever it might be. I can back it for however much I want without a reward, or I can select the option to back for $30, in our example, and get the game. So I back it, but I don’t get the game right away, this isn’t a store, they don’t have the games yet (most of the time, future Kickstarter lesson), they are getting the funding to then make the games. So they’ll send out updates to everyone who has backed them thanking them for backing and letting us know what their plans are and most often, letting us know about stretch goals. Stretch goals are extra things added to the game if it reaches a certain funding level. So in our cast, they really need the level to hit $40,000, but let’s say it’s doing well, and the game hits $50,000 or $60,000, they might add in some extra cards, a cool first player maker, an extra scenario, an extra character class (for an RPG), whatever it might be at certain points in the campaign based on how much they’ve made, because now they can afford to do that. This helps encourage people to back it because some of these things might be exclusive to Kickstarter (future lesson).

So, they’ve funded their campaign, now they get the money, but not all the money, Kickstarter is going to take some as well, because Kickstarter is a business and they need to make money as well. So even though they Kickstarter made, let’s say $80,000, the creator maybe sees around $72, 000 to $76,000. Now that it’s funded, they’ll send you the game, right? Not quite yet, they need to still get it made, so they get the money from Kickstarter, now they need to schedule with factories to get the game made, and most of the time, they also will be sending out a backer survey, this might be done through Kickstarter, but most often through another company, because $30 pledge for the game didn’t cover shipping. So you’ll have to pay a bit more to cover shipping, but the good thing is that this should basically just be the shipping cost because Kickstarter isn’t taking money from them for it. Though, the other site might be. Now you’ve paid shipping, let’s say $10, and for the game $30, it’ll get shipped soon. Almost, first, it gets into a production queue for some factory somewhere that is probably making a lot more and different board games throughout the year as well. So it might be 6-12 months before production begins, if not more. So production has happened, now it gets shipped, literally shipped on a boat, around the world, this can take a few weeks and up to a couple of months if there are delays at customs. From the ships it goes to a fulfillment company or to the creator to fulfill. They’ll be the ones sending you the actual game. So probably around a year after you Kickstarted it, you’ll get the game.

And that’s the general life cycle of a Kickstarer, it can take longer than a year, and it can be shorter than a year. But the cool part is that you can help small companies (or buy more of a sure thing from a big company) get their games out to the market.

I’m going to be talking about various things, such as what happens when a Kickstarter fails, what happens if it doesn’t deliver, what makes a good Kickstarter, what to watch out for, what stretch goals are, and how to avoid Kickstarter FOMO (if it’s even possible).

What are some of your best experiences with Kickstarter? Have you had any that have failed or not ever come? Are there any other topics I should cover around Kickstarter? Let me know in the comments below.

(All the images are of games that were brought to life on Kickstarter)

Share questions, ideas for articles, or comments with us!

Email us at nerdologists@gmail.com
Message me directly on Twitter at @TheScando
Visit us on Facebook here.