Suggestion: Kickstarter should include a clause that if not delivered by a certain date, the code and assets go public domain. Someone would finish it, meaning less wasted/dead projects for creators, and the backers more sure of getting something.

I think it's capitalizing on the "pre-order" mentality, people aren't donating to a kickstarter project, they're buying a game. As soon as you believe you are buying something that's a minefield of expectation.

Preorders, like gift cards, do not guarantee that any of the companies in the supply chain that are expected to fulfill them will be around long enough to do so (e.g., GAME Australia.) You are no more safe from mismanagement or fraud when you preorder direct or through a retailer. In those exceptional cases though, you may be provided recourse as an unsecured creditor through bankruptcy proceedings; however, you would recover only a fraction of your loss, if even that, after the claims of secured creditors have been addressed.

@Morgan depending on the preorder, there is a big difference. Many retailers will only charge your credit card the full amount AFTER the preorder has shipped/is available for pickup/ready for donwload. Some will charge before the item ships, but it is usually a small 10% or less. Same with a publisher download service like, say, Origin. This caps the amount lost because although secured collect before unsecured creditors, secured cannot collect money that was never collected by the company to begin with.

So your losses are much less than if you funded/preordered through Kickstarter where you could face 100% loss of your donation/prepurchase.

But if people are really donating funds on Kickstarter with the view that it's just like a preorder, they have a lot to learn about how businesses work. Most small businesses fail in the first three years, which is about the same amount of time required to take a game from concept to development. Why should gaming be different than any other type of industry?

A cynical view of developers and kickstarter would see some in the development community taking advantage of its most naive and passionate fans to induce them in taking terrible bets. They get no share of the potential profit if the venture succeeds and a high chance of receiving nothing. I think the onus is on the developer to explain that a Kickstarter contribution is a donation, not a preorder.

There will be many, many, many more of these types of stories in the years to come.

@Nate: Distributors typically charge for preorders immediately, especially preorders for digital products. Policies may differ, however. Barnes & Noble charges for digital preorders at checkout. Valve calls preorders "prepurchases" to make its policy clear. Amazon only charges when the product is "shipped." At the end of the day, when the transaction takes place has no bearing on the fact that Kickstarter is a platform for generating preorders.

People will now learn the hard way that backing something on kickstarter doesn't mean pre-ordering a certain game :). So maybe this is a good thing.

@Morgan: based on the power of Google, I believe you are incorrect.

Amazon: charge when they ship

Best Buy: Amount held as a pre-authorization (would probably go back to customer if BB went bankrupt)

Steam: Immediate charge

Origin: around 10% ($5 charges are common, then charge the rest when they ship)

Gamestop: Charged when they ship

B&N: Your information is false. It charges when it ships: https://www.barnesandnoble.com/help/cds2.asp?pid=26974. You are confusing an authorization hold to verify availability of funds with an actual charge.

And the elephant in the room is that pre-orders are typically purchased using a credit card. Many credit cards have buyer protection that would refund the amount charged if the item was not shipped as agreed. I believe this is imposed by federal law. This protection is notably NOT available for a Kickstarter project.

So, as I said the majority of retailers or "distributors" only charge when they ship or charge a nominal amount. Sometimes they ask the cc company to hold the amount as a preauthorization but these holds typically drop off after 7 days. In those circumstances, it is possible that the company could do another hold, but that would have to be continuous and at any time the customer could withdraw the retailer's authorization (if say, they heard the company was having problems). Regardless, the customer would most likely NOT be charged if the item never ships.

The major exception is Steam, but even for those purchases the buyer may have credit card protections to refund their payment. Those same protections would not be available for a Kickstarter project gone wrong. Plus, what's more likely -- Steam goes bankrupt and the purchasing entity decides to poison the brand by stiffing its anticipated customer base or a pie-in-the-sky Kickstarter project can't make the transition from clip art to a working product?

Kickstarters as a donation mechanism for the welfare of private endeavors are fine between consenting and fully informed adults. Kickstarters as a pre-order mechanism are a sucker's bet and shame on any companies that suggest otherwise to grab some easy cash.

@Nate: BN states their policy quite clearly, "Your credit card is charged only at the time we ship the product. The only exception to this is digital pre-orders such as NOOK Books, NOOK Magazines, NOOK Newspapers and NOOK Apps—for these items, the credit card account is charged immediately."

I don't know if it is better to turn out a game that looks like crap than to just not deliver a game at all. People who backed it might understand when a project flops, whereas they could be resentful of a poor project that was finished just to satisfy a contract.

All I'm saying is that without programmers, you don't even have the *option* of finishing, regardless of whether it's a good idea.

Fair enough. You'd have to retool a significant amount of the game (like turn it into a board game) to still get it out.

@Kenneth If you're poor and have been relying on the project for your livelihood you may have to release crap just to avoid bankruptcy. It's unfortunate but true.

They asked for $25,000... so a game like this in 5 months? From nothing? Good lessons learned I'd say.

"We’ve spent $42,500 on development so far and just need another $20,000 to see us through to completion"

@Sean That quote is one of the more puzzling elements for me. You would think that after putting up their own money and seeing how far it got them, they'd have a solid understanding of what it would take to finish. Apparently they had absolutely no clue whatsoever.

yeah Google is just a silly lil tiny company, why would anyone think of using a language they are building.

Oh brother..

This game would not have shipped if it had been programmed in C++, C# or for that matter Basic. The issue is poor planning and being naive when it came to the financing, which is all too common in the game industry.

The choice of language means nothing. Mine Craft was programmed in Java so I guess that project wasn't serious either....

I don't see how being a large search and advertising company says anything about said company's ability to design a language good for making games.

The choice of language dictates the learning curve, how easy it is to find programmers with knowledge of the language, performance capabilities, what libraries are available to reduce the boilerplate you must implement, and what platforms you can release on and how easy it is to port to other platforms. I'm not going to make a value call on their decision to use Go as I don't know their team's skillset or goals, but the choice of language does not mean "nothing".

They picked Go because as industry veterans they had tons of experience building games with that language. I mean most games use Go right?
Also Go is super wide spread so you can find programmers that know Go quite easy. Oh wait...

@Jane
"The choice of language means nothing. Mine Craft was programmed in Java so I guess that project wasn't serious either.... "
Java is actually an ok language, especially for tiny games like minecraft. I don't know what made you say that.

I'd be concerned the other could happen also, in that people end up ponying up a lot more cash then they wanted to due to mass loss aversion bias.

For VCs investing in projects, the expected fail rate is 80%. Why would kickstarter be expected to be any different? If you look at the budget and think "they're nuts, you can't do that for $25K" then you don't invest.

I think what we'll see over the next year is that the kickstarter investors will become more educated and learn to choose more wisely. People looking at this as pre-ordering a game may well decide to go elsewhere, but as they leave hopefully more savvy investors will take their place. I'm all for that.

FTL is my first pick. They had a successful crowdfunding campaign and recently had a very successful launch.

Zachary, would you mind submitting that? Just a link to the crowdfunding page and the game's homepage would be awesome.

Unemployment Quest. It shipped shortly after the campaign was successfully funded, though it got some backlash for being too short and using RPG Maker defaults considering that it made 1000% of its goal.

Since our days developing Desert Combat on our own we've always been very community focused, though it was challenging to maintain the same level of connection on subsequent projects with publishers. Now that we're independent, crowdfunding has helped us to connect with fans old and new on a different level.

As a new virtual studio/publisher, 2Dawn.com raised $38K for Ravaged marketing support on Kickstarter...but just as important was the help backers/fans provided through design feedback, beta testing, and grassroots publicity for this new vehiclular FPS franchise. Backers with relevant skills volunteered to help because they liked we were doing something different with vehicles and the FPS genre and our CM even started as a fanatic fan (he is from Denmark ;) Fans even created our awesome launch trailers with gameplay footage from our beta (which is impressive as it was an actual beta). Ravaged would definitely not be what it is today without them and though we have a great fan base from our other multiplayer FPS titles, Kickstarter helped us connect with more of them and in different ways.

We launched Ravaged and a demo this week on Steam as well as Origin and other digital distributors. We're fortunate to be the first Kickstarter project to be accepted on Origin and we're happy to help devs that have any questions on the process...seriously, just hit us up. Any success is because of dedication and hard work from the team, great partners, and most importantly our fans - who will always be involved in the how and why of what we do as well as the what, by helping with the roadmap for regular Ravaged updates. We're actually really enjoying putting the finishing touches on their rewards now...and though only a small part of our funding came from Kickstarter, I feel we have the Kickstarter community to thank for everything.

Good planning\scheduling and doing some form of common sense analysis on how much money you will need to finish the game is not reserved to just suits and business men.

Or, accountants who are gaming nerds and understand both sides of the fence. *raises hand*

what? an accountant and suit would of just siphoned off more money off the top while bringing nothing to the table. This game has missed its projected ship date because they switched from a single player approach to a multi player approach late in the design process. The two coders left for personal and possibly other reasons. This was not a money issue per se.

This is far from vaporware, and I would not be surprised to see this out by next Halloween.

Suits would of not helped here, they rarely help anywhere.

TC, although I agree with you about "suits" which is used exclusively as a pejorative, it is entirely false that there was nothing that could be done to save the project.

Someone who could watch the money, establish better milestones, reduce waste by keeping people on task, make the hard call to cut a feature here and there, or pitch for further investments could have saved the project.

The point William is making here is that although these guys are the "bad guys" in most companies, they can go a long way towards keeping the lights on.

The problem with suits and businessmen is that often they are great at making money -- for themselves, remainder of the company be damned. I am expecting/hoping for a new breed of more ethical CEOs to change the negative image that "suits" have frankly earned for themselves over the decades, but a large part of the allure of kickstarter for both developers and fans is the ability to escape the creative stagnation/poor wages+working conditions that the suit-driven AAA sector has set up. I would agree with William that an accountant on the team that views his coworkers as teammates instead of "human resources" would be great, but we have to be careful to prevent the rising Koticks of the world from poisoning the new-found well.

Kenneth,

these guys have an almost feature complete game, which just needs testing, they did it on 5k a month. Christ an account would charge 5k a month just to put his freakin 2 cents in.

Suits add nothing except their invoice to a project.

I've worked at a developer with lots of suits and seen games that failed to ever see the light of day there too. Making games is hard and sometimes they don't come together.

Wow you guys must use expensive accountants. Mine only charges for the tax return at the end of the year (and not even close to $60K). All advice is free.

I'm not sure this is admirable at all. People should not be treating Kickstarter like a store. Reinforcing the misconception does a disservice to the other developers.

Some of you remind me of my 3-year old, who contradicts everything I say just to be difficult.

@Alexey, how is taking personal responsibility not admirable? my god...There is no misconception here, people understand the risk.

He is behaving ethically without an expectation or requirement of dong so. You cannot fault him for that.

In the tv/movie industry (where I at least have a lick of experience) suits add nothing.

What makes tv/movie projects work are Assistant Directors.
ADs are not suits, they are usually people with extensive knowledge in the industry and production with their own qualifications in the field.
They are not pencil pushers, nor accountants, they usually come from film-schools themselves.

Unfortunately smalls game studios usually don't bother with an AD and the senior designer takes over that role, which leads to all kinds of trouble because designers don't come trained in the necessary skill-set.
In general in the videogame industry i see the trend that game designers are taking over too many responsibilities they shouldn't have, being an AD is just one of them.

Having someone solely dedicated to watching over project flow and budget is very useful.

Exactly my point. Someone watching over a project flow and budget, a financial planner.

http://www.cabrerabrothers.com/indielife/kickstarter-haunts-manse- macabre/

I think they'd basically have to lay out a business plan that includes potential risks and setbacks as well as specific figures taken from actual discussions with contractors for what the manpower and various other aspects will cost.

If the 2nd Kickstarter had the same business forethought as the previous one... I don't know. Fool me once, shame on you; fool me twice, shame on me. I'm not sure how many people would throw money at the "shame on me" option.