By: Stephen Crane (Photo: Courtesy Star Command)
Kickstarter projects are all the rage for indie developers these days. Crowd funding was popularized by Double Fine when Tim Schafer launched his project for a new adventure game. Unfortunately, taxes and rewards take a hefty toll on the budget as the developer behind Star Command recently learned.
The developers were eager to ship those products out, but they ended up costing a total of $10,000 for printing and shipping. Amazon took $3,000 in payment fees. War Balloon Games also spent $6,000 for game music, $2,000 for poster art, $1,000 for iPads, $4,000 for Attorneys and associated startup costs, then finally $3,000 to attend PAX East. Another $2,000 was taken out as tax. If you've done the math properly, that means the developer is left with less than a sixth of what was raised.
War Balloon Games has stated that if they could do it all again, they would keep the attorneys out of it, spend the money before tax day, and pay more attention to the costs of physical rewards. On Twitter, they stated their books were "made public to help other kickstarters - really nothing to do with the game at all."
The Star Command developers should not be faulted for revealing what happened with the money. To the contrary, they should be praised for their honesty and for showing the transparency expected from similar projects. In reality, they have put $16,000 towards game development and marketing, and the $4,000 remaining puts them at the $20,000 they asked for. The attorney fees may have been an unwise investment in retrospect, but keeping everything legally sound is a good idea in the long term.
The news is a bit difficult for some fans to swallow. Backers should always keep in mind the youth of Kickstarter as an investment method. There are associated risks as many projects play with the rewards systems and learn from mistakes. With no set model for developers to follow, many project creators are winging their rewards and hoping for the best.
We have yet to see whether there will be a chilling effect on future Kickstarter investments. Potential backers and project creators would do well to learn a lesson from this story and beware physical rewards. Vanity items, like a name in the credits or as an NPC, or even in-game items may be the best route to take.
Kickstarter has been on the tips of everyone's tongues whenever an indie project is considered, and it's become a phenomenon so young that no one really knows what to do with it yet. This is just one of those growing pains, and with the issue out in the open hopefully other other projects will be less risky.