Skip to Content

Taking another look at Kickstarter: Are there alternatives?

11 replies [Last post]
InvisibleJon
InvisibleJon's picture
Offline
Joined: 07/27/2008

Hi All,

On June 20, 2010, a friend of mine and I successfully Kickstarted Inevitable (http://www.kickstarter.com/projects/dystopianholdings/inevitable-dystopi...) and used that cash to produce a small (500 units) print run of it. Shortly thereafter, the folks at Clever Mojo did a fantastic job with Alien Frontiers and boardgame projects on Kickstarter exploded.

Our Kickstarter experience was (largely) positive, and I believe that Inevitable could not have been made without it. In light of that, it may seem odd that the next time I self-publish a board game, I don't think I'm going to use Kickstarter. Let's take a look at why:

What does Kickstarter really bring to the mix?

* Publicity and Exposure?:
-- When we did Inevitable, Kickstarter hadn't quite burst out as a known thing yet. It was a lot easier to get on the front page, and we did (we were pretty much the only board game on the site, and the project was colorful and quirky). Consequently, we *did* benefit from being a featured project for a time. Nowadays, it's a *lot* harder to get a coveted front-page slot on Kickstarter. And really, what got us the most hits and funding was getting featured on io9.com. (That was a $2,500+ day.)
-- Assertion: Kickstarter doesn't give you much publicity or exposure nowadays. Kickstarter does provide a convenient toolset to push updates out to your backers and would-be backers, but I address that below. Even so, you'll work just as hard pushing your project on community and industry forums, social networking sites, news outlets, and to reviewers if you were using some other "rally support" setup.

Publicity and Exposure Advantage?: Nominal

* Tools?:
-- Kickstarter provides a blog, of sorts: There are lots of ways to create blogs.
-- Kickstarter provides a delayed payment / "pledge" system: They're just using Amazon Web Payments to do this. You can do this yourself with AWS too.
-- Kickstarter provides a trusted third party to manage that pledge system so you don't take a stranger's money and run: Okay. That's a valid point. However, if you're an established entity with a sterling reputation (and perhaps a successful Kickstarter campaign or two to use as character "references"), you should be able to assuage most concerns or fears. Also, it's important to note that Kickstarter does not guarantee that a given project will actually come through on its promises. All they do is prevent someone from taking your pledge if the project does not make.
-- Kickstarter makes it easy to mail information to all donors: Listservs have been around for a long time, thanks.
-- Kickstarter protects the anonymity of the pledgers until the project makes: Fair enough. You can come close to this with existing tools, though. I suspect a competent coder could implement this fairly quickly.
-- Kickstarter provides a nifty reward/pledge structure with a big countup tracker for amount donated, along with a countdown timer: Yeah. That'll be a pain to recreate. This is probably the biggest "bonus" that Kickstarter provides.
-- Kickstarter lends its "cachet" to the projects on it: This is a straw man argument that I really should not include. Any perceived legitimacy is largely undeserved. Nowadays, anyone can put up a project on Kickstarter. When Inevitable was Kickstarted, it was invite only like the start of GMail was, so it had the "air" of being more exclusive and special. (Get offa my lawn ya' darn kids!)

Tools Advantage?: Moderate to significant. It would not be too hard to whip up your own site that does about 75% of what Kickstarter does. That last 25% isn't utterly essential, but it's certainly nice to have.

* The Cost:
-- Kickstarter takes 10%.
-- Amazon Web Services takes (if I recall correctly) about 3.5%.
-- The income is taxable, so it'll be taxed at the rate of whatever entity receives the cash.
-- Note that you should also collect sales tax for every "pledge" that's in the state you'll be selling the game from, (since they're actually sales -- they're giving you money in exchange for tangible goods)
-- There's also a significant time cost that you'll invest in creating the resources and managing the campaign.

This point makes it increasingly likely that my next project will not use Kickstarter. Of the $9,435 we raised, $943.50 went to Kickstarter and $330 went to Amazon. We paid the two of them over $1,000 to provide the tool and host our Kickstarter site. (I'll say this: The folks who started/own Kickstarter? They're sitting pretty.) On top of that, there's the taxes on the "pledges"...

If I'd spent time up front to create a functionally equivalent site (that I could reuse -- or even share/market to other people), I wager it'd've cost me less than that $1,000. Yes, that's an up-front expense that many Kickstarter types can't afford, but it's an important consideration. For many people, they're more than happy to let Kickstarter do this. To their minds its like, "Hey, I'm happy to give 10% of money that would have otherwise been nothing." But is that the smartest thing you can do? Shouldn't you be getting more for your money than just a tool and some "hosting"?

Consider this:
* Alien Frontiers raised $14,885. $1,488 of that went to Kickstarter (and a total of $2,010 to KS and AWS).
* Alien Frontiers: Factions raised $76,078. $7,607 of that went to Kickstarter (and a total of $10,270 to KS and AWS).
* Schlock Mercenary: The Board Game raised $82,056 $8,205 of that went to Kickstarter (and a total of $11,077 to KS and AWS).

What did Clever Mojo owe that *massive* boost in funding to for their second campaign? Did Kickstarter provide them with $4,800 worth of extra ad space on their site? No. That massive increase in funding was all due to the awesome job they did on the game and promoting it. Could the Schlock team have spent that $8,000 on internet ads and just done all the sales through The Tayler Corporation's online store? I bet they could. For that matter, I bet they could have spent only $2,000 on some website infrastructure improvements and raised roughly the same amount of funds in pre-orders while maintaining Kickstarter-equivalent features and tools. It may seem like sacrilege, but I assert that Kickstarter did not really deserve or "earn" most of the money it received from AF:F or SM:TBG. (Don't get me wrong. Kickstarter deserves to be compensated for what they provide. I just think that some projects are spending waaaay more than they need to and had alternatives that were functionally equivalent (or better) and would have cost less.)

So if I'm so smart, what's my suggested alternative? Honestly, I'm not sure yet. Also, I'll admit that my plans for alternatives rely in part on having a successful Kickstarter project in the past. All that said:

* I'm sure as heck that if you're riding the coat-tails of your prior successful project, you should find another way to gather pre-orders. Spend some cash and build your own tool... Something... Anything. The same holds true if you have a license that you *know* will gather support from a rabid fan base.
* It's easy to set up a site with forums, chat, listservs, blog, a store, shopping cart, photo galleries, etc... with any number of free open-source content management systems (My preferred CMS is Drupal). For the things that Drupal can't do yet, well... I don't yet know how to take a delayed payment through AWS, but I'm sure I could learn (or hire someone who knows how). Anything can be built, and it's better to invest in a thing you own and can re-use than to rent the use of something you're going to use over and over again.
* Investors or bank loans have several advantages over pledges, from several points of view (taxes, partnership, and expected return on investment (odds are good that with interest rates what they are, you'll be able to beat 10% to 13.5%). Funding your project with a bank loan could very well be viable -- especially if you're collecting pre-orders on your web site.

Other topics I want to touch on, but it's getting too late:
* Getting that $$$ up front makes you feel more secure (as a developer) since you know you'll get it. A no-cash pre-order is too easy for the pledger to "break". How do you address that in your home-baked pre-order site?
* Knowing that your KS project has "made" (or not) is a clear sign to you that you have a commitment to complete (or not). Can you get that same clarity when you run your own pre-order site?
* If you see a drop-off in pre-orders when you go over to your own solution, will it result in a 10% drop in funds raised? Is this a bad thing?

I'm eager to hear your opinions on this. I acknowledge that this presentation is incomplete, but I think it makes a nice starting off point.

Cogentesque
Cogentesque's picture
Offline
Joined: 08/17/2011
Jon I think that was a lovely

Jon I think that was a lovely post and you raise some important posts.

At the start I was very dismissivve ( I <3 Kickstarter) and haughty-taughting my way through your words. The more I read, the more I started understanding what you were saying and agreeing with you. My Qualifications: I did the interview with the co-founder Yancey Strickler, of Kickstarter for purple pawn recently and have helped out quite a few teams with their kickstarter pages, as well as having ketp a solid eye on kickstarter projects in recent months (I remember your game going up btw man, I thought it was very pretty!).

I think an important point to note is that Kickstarter is bigger than you and me. Once (as you put it) you have completed a kickstarter, you become more famous and as such have more sway and have dedicated fans (A very common "why do you buy games" is todo with repeat performance from designers and pubslihing houses).

As soon as you have the one or two games under your belt - you are in a much easier place to wield buying power and fandom all up-in-here. Kickstarter in the first instance gives people the confidence to start their game and produce and deliver it. Once they have done this, they will have probably put a decent amount of work and marketing and all into their product meaning that they are in a better position than before kickstarter.

Once you are in this magical zone, I think it would be very easy to move away from the crowd funding/finance side and go direct to making games. But since kickstarter is fast becoming a steady mechanism, it already has expectations and boundaries set and people know.

For example: "Now we are releaseing the sequel to our very popular Kickstarter funded game!" does have a nice ring to it - I would trust it. And as such I would buy it.

I think kickstarter is a springboard that helps you launch into board game publishing easier than creating a website "www.nobodyknowsthesegames.org.com/myfirstgame.php" however fancy looking, is a lot less attractive (and "hype-able") than www.kickstarter.com/mygame - press here to back.

However I do agree that you could probably do the same (as many other site have done) homebrew stylee. And not have to pay out the 10% to kickstater. But your site wouldn't be as known, slick, easy, prepared, or popular as Kickstarter.

Looking at it from a very simplistic and logistcal stand point:
I have never "pre ordered a game" I would (at least at this point in my life) probably not back anything from an indy dev/publisher that has anything like a kickstarter backing system and also (perhaps to illustrate the point again?) have never backed anything on any other of the crowd funding sites (indy gogo, rocket hub, we fund etc x 100 )

It's just, it's just not Coke is it? It's pepsi...

Also another, more stifling point would be that I know for a fact (check the interview!) that Kickstarter did a huge market tour of a finance option for the "we take your money, but you dont pay anything until a certain point" that amazon do: I honestly don't think that any semi-pro team could arrange something like that on their own at all. you need a company and contracts and assurances and minimum levels and credit checks and things. I think your option would have to be "pay us the money in full - if, after a month, we do not have sufficient money - we promise to refund you the money" Which would be another barrier to the money-interested person. I know for a fact that if I pledge and the project doesnt go through - I am not out of pocket (Even thogh in all honesty this is probably not a big issue, at least it is one of the assurances that I, as a customer who likes to be treated well, like)

As said before Jon, great points man :)

zipplockbag
zipplockbag's picture
Offline
Joined: 01/12/2012
So what I'm getting from this

So what I'm getting from this exchange here is that for start-ups, Kickstarter is a fantastic resource but for followup projects, you should be able to save some money with a roll your own site and shopping cart?

Also, I think KS only charges 5%, not 10%. I wonder if this is a recent change? I haven't had much experience with Kickstarter until only very recently. How would this change the whole argument as far as using Kickstarter as a tool to generate funds as your business model?

P.S. I like Pepsi better than Coke :)

InvisibleJon
InvisibleJon's picture
Offline
Joined: 07/27/2008
Ooh... A critical fact is shown to be incorrect...

zipplockbag wrote:
Also, I think KS only charges 5%, not 10%. I wonder if this is a recent change?
Egads! I wonder if that's a change, or if I just got my facts wrong. If so, I'm wearing egg on my face.

Thanks so much for pointing that out to me!

zipplockbag
zipplockbag's picture
Offline
Joined: 01/12/2012
No problem! It might make the

No problem! It might make the difference between going with KS or not!

InvisibleJon
InvisibleJon's picture
Offline
Joined: 07/27/2008
Going over my records...

...I see that we received $8,443.51 from Kickstarter for a project that raised $9,435.

What we received was 89.5% of what we raised. That could meant that KS took 10% and AWS took .5%, but I find that unlikely. Perhaps it was 5% and 5.5%? At any rate, it seems that my math is out of date and inaccurate, since the total "cut" from KS and AWS combined for us was 10.5%.

I'd love to go back and edit my original post with new math. After all, I don't really want to include the processing fees from AWS in my "debate", since you're going to get hit with processing fees no matter what you do.

InvisibleJon
InvisibleJon's picture
Offline
Joined: 07/27/2008
Thanks for the thoughtful and insightful reply.

Cogentesque wrote:
Jon I think that was a lovely post and you raise some important posts.
I really like your post too. You make some excellent points and shared new information I did not have. I sincerely appreciate it.

I'm busy now, but I *will* give your reply the attention it deserves in the form in the near future.

sedjtroll
sedjtroll's picture
Offline
Joined: 07/21/2008
Indeed...

Indeed, Kickstarter takes 5% (I believe AWS may vary) and has as long as I've known (though they may have increased this, or maybe even decreased it between Inevitable and Eminent Domain's project).

If you have the time, gumption, know-how, and capital to make your own personal version of Kickstarter, then by all means - do it! If not, you could start a Kickstarter project to fund it ;)

But if you don't - and really that's a lot you have to have - then it becomes more and more worth it to pay Kickstarter their 5% (you'll have to pay whatever credit card service you go with, so the AWS amount is irrelevant).

- Seth

Fhizban
Fhizban's picture
Offline
Joined: 01/11/2009
I liked the initial post very

I liked the initial post very much, there are some gems about the "system kickstarter" hiding in there.

Just wanted to add my 2 cents (despite i live in germany and cannot host / have not hosted a project on kickstarter yet)

Besides being a real funding alternative (I am evaluating to give it a try myself once KS become available in germany/international), there seems to be some kind of bitter aftertaste to the idea: Sometimes it looks like that projects use KS merely as a staging area for promoting their project and either have heavy-weight backers already up their sleeve or do not care for backers at all. dont get me wrong - i really like the KS concept and don't want to start flaming it here. But, maybe its just me, some of the campaign interactions are rather miraculous (like projects with no updates at all, receiving 300% overfunds within a extremly short timespan etc.) while others fail right from the beginning due to the lack of community support (FB, twitter, mailing list and industry sponsors).

please dont get me wrong, this just represents my own - subjective oppinion. but a friend of mine failed twice on KS despite mobilizing all the community power he could - while other projects (mostly from already established companies/brands/producers) succeed without lifting a finger (apparently).

Just wanted to shed some light on this spot - reality-checks like these are necessary for every web 2.0 concept in my oppinion. its the same with banners and google ads - many praise it as "the ultimate solution" - but the truth it, that it works out only for a few gifted projects.

zipplockbag
zipplockbag's picture
Offline
Joined: 01/12/2012
Crowdtilt

There's a new alternative, literally started last week, of a crowd funding alternative to Kickstarter called Crowdtilt: https://www.crowdtilt.com/

They charge no fees, even for the credit processing fees. Not sure what the catch is yet, but it's worth a look!

PauloAugusto
PauloAugusto's picture
Offline
Joined: 12/04/2011
From Kickstarter

From Kickstarter fans/supporters/pledgers 's opinions (bgg's many forum discussions about it), it is clear that most pledgers are pledging mostly to support the board gaming world, kind of like making donations to help the underdogs, to help come to fruition out-of-the-box and unique game ideas, and to stimulate board gaming in general. They are not really pre-ordering games.

My greatest concern is if those people understand that 10% (not including taxes) of the money they are spending in the hobby is ending up no where near the hobby or the idea/company/designer they are trying to support. They may feel like they are being taken advantage over.

If i had ever supported any campaign without having been clearly informed that ~10% of the money would go somewhere else than it apparently should (the campaign itself), i would be extremely upset once i found out.

rpghost
rpghost's picture
Offline
Joined: 03/03/2009
And while admittedly this

And while admittedly this isn't all that great of an idea and the buy in isn't all that cheap... there is something to be said for this campaign having 0 pledges. https://www.crowdtilt.com/campaigns/colored-baggies-for-board-game-organ...

It it was on Kickstarter I bet they would have gotten a few to plenty by now.

Most gamers do not pre-order at a publisher site either, they will pre-order from a online store and get it cheaper. So that's not a good comparison.

I think the P500 thing that GMT does is about the closest comparision around - it worked to a degree...

James
Minion Games

Syndicate content


forum | by Dr. Radut