Crowdfunding – For Fund or For Fraud?
Crowdfunding is exploding as a new way of attracting funding and financing for games, game tournaments and more. But is it really necessary? Let’s explore some facts.
Crowdfunding has become a popular way of finding alternative investment routes. The use of crowdfunding in video games has had a history for several years prior to 2012. The crowdfunding mechanism for video games received significant attention in February 2012 due to the success of the Double Fine Adventure game (renamed as Broken Age), a point-and-click adventure game which raised more than $3 million through the Kickstarter service, by greatly exceeding the initial $400,000 request and becoming the highest-funded project through Kickstarter during that time! By mid-2016, more than $186 million has been pledged to game-related projects through Kickstarter alone.
Kickstarter is an American public-benefit corporation which has built a global crowdfunding platform focused on creativity.The company’s mission is to help bring creative projects to life.
Wasteland 2 was announced as a Kickstarter project to develop a sequel to the 1988 RPG Wasteland,a spiritual predecessor to the Fallout The effort was backed by several of the game’s original developers now under the development company inXile Entertainment. The game successfully raised more than $2.9 million from an initial goal of $1 million, allowing them to co-develop the game with members from Obsidian Entertainment.
Blackroom, an unreleased but upcoming FPS game byDoom developers John Romero and Adrian Carmack, fell short of its $700,000 goal and managed to gather just $131,052. This was because the campaign was cancelled before its scheduled release date due to the focus on the development of a demo.
However, less than half of the crowd-funded projects successfully raise their target funds. Some examples of not-so-successful projects are:
The development of the game Alpha Colony fell short of its $50,000 goal by $28, rendering the project unfunded
Blackroom, an unreleased but upcoming FPS game by Doom developers John Romero and Adrian Carmack, fell short of its $700,000 goal and managed to gather just $131,052. This was because the campaign was cancelled before its scheduled release date due to the focus on the development of a demo.
What is Crowdfunding?
Crowdfunding is a means to raise money for a project by drawing funds from the potential users. While no third party is required for crowdfunding to occur, websites like Kickstarter have been created to share their project, provide ways for users to pledge their funds, and then supply the pledged funds to the creators of those projects. A minimum pledge assures that the funder will get the product in some form, but higher pledges will include additional benefits. Such as receiving promotional items like T-shirts or game goodies, or obtaining an early access to the game, or simply just meeting the game developers in person.
A recent and popular example of crowdfunding would be Valve’s DOTA 2 International Compendium 2016. The prize pool is currently sitting at $19,755,755 and is expected to reach over 20 million dollars by the time it begins. 2015’s International Compendium saw a total of $16,829,613 contributed, which doubled that of 2014’s contributed prize pool.
To sum it up, there are other platforms in the gaming world and there certainly will be others in the future. The gaming industry has embraced the benefits of crowdfunding and justifiably so. While the strategies for successful crowdfunding games will continue to change and grow, one thing is certain: Be it for fund or for fraud, crowdfunding for games is here to stay.