Kickstarters, good or bad?

[Leon]

With the recent surge in popularity of Kickstarter projects, are they a good or bad thing?

For those unfamiliar with them, Kickstarter is a website which allows you to advertise any given project for crowdfunding (http://www.kickstarter.com/).  This works by people seeing the project, and then pledging their financial support, working towards a set goal.  There are various levels of support within each Kickstarter, and the person receives something in return, dependant on the amount they have pledged.  So, for a $5 pledge, they may receive a single figure for example, $30 they get a full set of 10 miniatures, going up to the top level pledge where they may get a fully painted set, designing their own figure, a signed piece of artwork, etc.  Once the pledges go past the predetermined goal level, then the project gets the green light, everyone's accounts are debited with the pledges, and the company gets their money.

There have been mixed successes I've seen so far, from unfortunate projects that receive almost no backing, right up to Reaper's recent Kickstarter, which raised $3.5 million!!!    It's an interesting concept, but it does throw up some questions. 

- Is it a innovative way of getting your idea out there and visible in a competitive market place?

- Does the original Kickstarter campaign saturate the company's own market, meaning there are no sales to be had once the figures are on general sale?

- Will we start to see problems occurring where people have underestimated the amount they need to bring a project to market, and find they don't have the funds to complete it?

- Does it create a very effective buyers market, where simple supply and demand dictate what we see produced?

- Does it potentially affect the motivation of a company, when the financial risk of failure is highly reduced for them?

- Has anyone pledged themselves, and what did you think of it as a concept?




(DISCLAIMER: As usual, this is nothing to do with Pendraken, just something I thought would make for an interesting discussion.  The Crossover Miniatures stocked by Minibits were created through this method, and I know Rusti found it to be a great success, and he'll be using the process again for his next batch.)

[Duke Speedy of Leighton]

I bought into both the 'Schlock Mercenary' (game based on comic) and 'Order Of The Stick' (book reprint) Kickstarter drives.
Both did very well, because they had a huge fan base already, and they were launching product I would either use or have bought eventually for a much higher price.
However, it would have to be something I am hugely interested in to get me to pledge again, hence I haven't gone into any of the massive amounts of computer games or 28mm figure starters there seam to be around.

[zaapark]

I did for Ogre and another one that failed to raise the $600 it needed.  Seems to be a lot of these projects but haven't really found another one to follow.  But I agree with Leon and I always wondered what happens if the goal that was set wasn't enough to finish the project.

[FierceKitty]

Could something like this be used to get the Aztecs going? It's really been a long time.

[Leon]

Could something like this be used to get the Aztecs going? It's really been a long time.

I'm not sure there'd be enough people pledging for any 10mm range to be viable.  

Let's say a range was 20 codes, 2 figures per code.  With the sculpting and moulding, you've got about £1200 ($2000) of investment needed.  With a full army pack currently costing £25, combined with the need to be offering people something at a discounted rate to get them to pledge, the average pledge might only be £20 or even less.  So we'd need to find at least 60 people willing to pledge into an Aztec range before it hit the goal?

[i_am_win]

meh....don't talk to me about crowd funding.....

[Techno]

I'm not sure there'd be enough people pledging for any 10mm range to be viable.  
Let's say a range was 20 codes, 2 figures per code.  With the sculpting and moulding, you've got about £1200 ($2000) of investment needed.  With a full army pack currently costing £25, combined with the need to be offering people something at a discounted rate to get them to pledge, the average pledge might only be £20 or even less.  So we'd need to find at least 60 people willing to pledge into an Aztec range before it hit the goal?

Is that likely with the (currently, almost) 1,000 members of the forum ?
Be interesting to see if many 'jump in' to support it.
It's got to depend on the overall popularity of 'the period' with so many other ranges available at present.

Cheers - Phil

[Duke Speedy of Leighton]

Other 'Kickstarters' can be used to link in (if you have sponsored this, you might like to back...) so you may pick up custom that way, plus TMP notice.
However, here I think it will only have a limited use, may be one or two ranges, before its interest wains. It would also have to be something guaranteed to sell (like the Schlock Game where he has thousands of readers a day on his webcomic).
Personnally,  I'd kickstart a project by sending Techno an email with lots of details and a large cheque.   
BTW how are those Limber riders doing? Doth thou need any more info Techno?

[goat major]

Its a really interesting and innovative concept to bring funds to smaller/niche enterprises.

However, i cant help but feel that we are currently riding a wave and at some point the bubble will burst (and the mixed metaphors will get worse).

My prediction - in the next 12-24 months a huge kickstarter project will go completely belly up and no one will see the money that has been taken. There will then be a subsequent drop in confidence which might lead to a more rational marketplace in the fall-out.

Call me Cassandra 

[Techno]

Personnally,  I'd kickstart a project by sending Techno an email with lots of details and a large cheque.   
BTW how are those Limber riders doing? Doth thou need any more info Techno?

Sounds wonderful to me Lemmey !....I like large cheques !
I'll give you a shout as soon as the current limber/outriders turn up....Shouldn't take too long to do those.
They'll probably take ages and ages to do, so be prepared to remortgage your home !
Cheers - Phil

[Duke Speedy of Leighton]

Its a really interesting and innovative concept to bring funds to smaller/niche enterprises.

However, i cant help but feel that we are currently riding a wave and at some point the bubble will burst (and the mixed metaphors will get worse).

My prediction - in the next 12-24 months a huge kickstarter project will go completely belly up and no one will see the money that has been taken. There will then be a subsequent drop in confidence which might lead to a more rational marketplace in the fall-out.

Call me Cassandra 

Hello Cassandra. 

Got to agree with you Cas, that wave will collapse wiping out some surfers. South Sea Bubble for that wave? Dotcom boom? All looks familiar...

[sebigboss79]

Its a really interesting and innovative concept to bring funds to smaller/niche enterprises.

However, i cant help but feel that we are currently riding a wave and at some point the bubble will burst (and the mixed metaphors will get worse).

My prediction - in the next 12-24 months a huge kickstarter project will go completely belly up and no one will see the money that has been taken. There will then be a subsequent drop in confidence which might lead to a more rational marketplace in the fall-out.

Call me Cassandra 

You do have a strong point there.

Imho only established traders should do this kind of finance. I mean, we all know some crook could just deliver a sweet talk and great pics, we buy it and they run off with the money.

Happened before the net, will happen at kickstarter, will happen in other forms. Having said that it is up to YOU as a donor (you really ain't anything else) if you WANT to support that company.


@Leon: I do see the potential for Pendraken here. 60/1000 supporters means 6 % of us have to pledge. Call me Cassandra 2 but I feel people are willing to invest 10 - 20 USD for such a venture. Mind you it is not only people wanting something back for their financing. Some will be happy to donate a few bucks in order to be able to buy a single mini, a pack or just see a range being "done".

Aztecs is not really my thing (at the moment) but for example modern forces would be. So maybe 5 bucks on the Aztecs and 30 or so on a modern British force, or Foreign Legion or.... well whatever, you get the picture.

[crossover]

Hi guys, successful Kickstarter here.  I loved the experience and think it is a wonderful tool.  

- Is it a innovative way of getting your idea out there and visible in a competitive market place?

Of course it it!  Crowdfunding is to ecommerce what blogging is to traditional news.  Blogging and instant news has destroyed newspapers and other institutions that were the ONLY place to get serious news only 15 years ago.  Now they are figuring out how to keep up with the sites offering small, flexible sources of what folks want.  It’s a great way for someone like me to get something out to market without the traditional means of manufacturing miniatures or even having ever met someone in person who does.  

- Does the original Kickstarter campaign saturate the company's own market, meaning there are no sales to be had once the figures are on general sale?

While it does slow the original sales as many folks will already have it, but you have to figure in some profit into the mix, if MAX profit is what you are after.  I needed the original profit to get started, pay for the sculpting, molding, and lead.  But since the original kickstarter, I have sold enough minis to pay for the sculpting up front the next round, so I can now only use Kickstarter to raise the remaining money needed.  The next release shouldn’t need any Kickstarter help, then I can sell the figures at full cost off the bat.

- Will we start to see problems occurring where people have underestimated the amount they need to bring a project to market, and find they don't have the funds to complete it?

This will happen someday because many people are stupid people.  There are many issues to take into account when producing and delivering miniatures.  NONE of which I knew before I started looking into it, about 8 months before the kickstarter.  I was looking into importing another small UK range and started looking into the costs associated with improrting and selling and shipping miniatures.  When I looked into producing miniatures, there was A LOT to learn, but I did it as in depth as I could.  I have created websites for about 5-6 miniatures companies in the past 4 years, so I had some contacts to call and youtube supplied the rest.  Not everyone will research for the proper amount of info before getting started.  Someone already in the business is the most logical choice as they know the costs already.  But Kickstarter is also there to help make some folks dreams come true (like it did for an outsider like me).  But there will be some failures.  Choose well and make sure the page is put together by someone who knows their a$$***e from their elbow.  You can tell a lot by the info on the kickstarter page.

- Does it create a very effective buyers market, where simple supply and demand dictate what we see produced?

Exactly so.  My first Kickstarter started by me emailing a sculptor that I knew wanted to start a range, but none of the big boys (established companies) that he worked with would ask for a super hero range as there is no money in it.  So he sculpted 4 figures and we showed them off, I asked for what I absolutely needed to get it started, and reached 160% of my goal.  That's free market to the tee, and every backer got the figures at about 75% of the retail and a few little extras.  Some folks even got to design their own hero!  That's fantastic in my mind.  Everyone got what they wanted out of it.  It blows my mind that people try to make fun of it or the old guard that won't even discuss it as it disgusts them that folks are allowing the general public to take part in the industry.

- Does it potentially affect the motivation of a company, when the financial risk of failure is highly reduced for them?

Not at all I would think.  This is the perspective of established companies that have ‘paid their dues.’  But all my risk was put in before the kickstarter was funded.  Once funded, it’s a done deal and you still have to do a good job.  Though I suppose you could head to the Caymans on all that dough, but most likely you’ll follow through on what you said you wanted to do.  It takes weeks or months to get your kickstarter page together and make it look good, not to mention all the other stuff you have to do to get ready.  It still takes time and money to execute.  I know what I will make this week at my day job, I have a contract that lasts throughout the year, but I go in and do a good job every day.

- Has anyone pledged themselves, and what did you think of it as a concept?

I love it and I pledge as often as I can.  There are some truly original concepts on there and some big risks you won’t find big companies even going near.  

-Let's say a range was 20 codes, 2 figures per code.  With the sculpting and moulding, you've got about £1200 ($2000) of investment needed.  With a full army pack currently costing £25, combined with the need to be offering people something at a discounted rate to get them to pledge, the average pledge might only be £20 or even less.  So we'd need to find at least 60 people willing to pledge into an Aztec range before it hit the goal?

Leon, you don’t need to fund the whole project!  In fact they recommend that you only fund a percentage.  I suppose you have to wonder if you would want to make a range that only 60 people wanted?  If the answer is yes, go for it!  If you can get the sculpting and molding paid for, then every pack you sell from there on out is much more profitable.

[crossover]

You do have a strong point there.

Imho only established traders should do this kind of finance. I mean, we all know some crook could just deliver a sweet talk and great pics, we buy it and they run off with the money.

Happened before the net, will happen at kickstarter, will happen in other forms. Having said that it is up to YOU as a donor (you really ain't anything else) if you WANT to support that company.

I think this is how many folks felt about eBay when it started, but it works, even though many people are dishonest, many more people are not. 

I wasn't an established company, just a guy with a plan who knew folks in established companies.  Everyone else who took part in producing the miniatures, sculptor, mold makers, and casters are all very well established, but it was my first rodeo.  I think we did rather well.

Respectfully, I think the word donor couldn't be farther from the truth.  All the donors to my Kickstarter received exactly the minis the wanted at 75% retail cost.   

[FierceKitty]

I'm not sure there'd be enough people pledging for any 10mm range to be viable.  

Let's say a range was 20 codes, 2 figures per code.  With the sculpting and moulding, you've got about £1200 ($2000) of investment needed.  With a full army pack currently costing £25, combined with the need to be offering people something at a discounted rate to get them to pledge, the average pledge might only be £20 or even less.  So we'd need to find at least 60 people willing to pledge into an Aztec range before it hit the goal?

So they're just not going to happen?

[Luddite]

Cloud funding's an interesting proposition.  It seems a bit like micro-scale venture capitalism to me.

I guess the problem i see is the problem with established suppliers.  The niche market figures are never going to sell well enough to make the ranges viable, which is why traditional sellers don't do them.

Also, i'm struggling to see the incentive for someone to pledge money. 
So you get a one off batch of figures at 25% discount? 
But now you've potentially kicked off the career of someone else who will go on to make lots more money - including presumably money out of you as you buy future product? 
Wouldn't the capitalist in you prefer to 'buy shares', or 'invest' for a better long term return in this venture?

I'd prefer to see a cooperative financial model.

That said, anything that gets funding to small start-ups in the hobby is a good thing surely? 
Or is it? 
After all, we already have a very large number of companies supplying a niche hobby.  Are there too many already?  Wouldn't it be better to consolidate all those into perhaps 1 supplier per scale? 
Who knows...

But it's moot as it won't happen.  And we as hobbyists don't want it to.  Look what happens to the 'big players' who corner a market - scorn, bile and hate in torrents is poured on them by the hobbyists.

Um...

I'm rambling aren't i?

OK, i'll stop.

[i_am_win]

I'm not sure there'd be enough people pledging for any 10mm range to be viable.  

Let's say a range was 20 codes, 2 figures per code.  With the sculpting and moulding, you've got about £1200 ($2000) of investment needed.  With a full army pack currently costing £25, combined with the need to be offering people something at a discounted rate to get them to pledge, the average pledge might only be £20 or even less.  So we'd need to find at least 60 people willing to pledge into an Aztec range before it hit the goal?

Don't forget that you could tempt potential supporters with any items from your back catalogue of minis with your support levels, I think as an established firm you'd be fine to get funded in this way, only thing is, your going to have to have mass appeal, and not everyone wants or needs 10mm Aztecs.
To get around this you could offer a choice of different figure packs and option other than just aztecs. I myself wouldn't support it if all I was going to get aztecs, but I would if there were other goodies from your ranges...

From my past Indiegogo campaign I have learned a great deal, and even though I failed epic (yeah, I suppose I underestimated what was needed in the first place, etc.....) I am still going to relaunch with a kickstarter next year. I am in the process of getting the sculpts done one at a time as and when I can afford it (Getting the greens done first would have probably got more support in the first place)

http://thegrinningskull.wordpress.com/2012/09/14/15mm-oggam-sculpt-almost-final/

The sculpt has certainly added some support for getting them done and by the time the greens in the line are done, I should have enough for a win (and I am win!!)
Im doing loads of market research next time to make sure that everything is right and hopefully it'll be a success.

There is a good report here about crowdfunding and the RPG market with stats, its a good read if you want to gauge success Vs fails etc, best strategies and so on....

http://qitsune.wordpress.com/2012/05/06/a-great-market-study-on-kickstarter-success/

[crossover]

Also, i'm struggling to see the incentive for someone to pledge money.
So you get a one off batch of figures at 25% discount?

Let's look at it.  You've been given what you want at a discount.  Let's not forget that product would not have been created if it were not funded in this way.  So you have helped create the product as well.

But now you've potentially kicked off the career of someone else who will go on to make lots more money - including presumably money out of you as you buy future product?

Talk about presuming.    I think "lots more money" is a possibility, but in my case you will just do your part to insure more models.  So what you are doing is helping to insure that the toys you want will be available. 

Wouldn't the capitalist in you prefer to 'buy shares', or 'invest' for a better long term return in this venture?

I'd prefer to see a cooperative financial model.

That just isn't what this is.  It's a reward system for folks backing a project.  Not an investment, if you are going to look it as an investment without an investors reward, you will certainly be disappointed  in the process.  Many people that have a problem with Kickstarter are trying to compare it to oranges.  It's new and different, you have to judge it on it's own merit.

An investment or 'buy shares' arrangement just isn't going to work.  It's too complicated and you need lots of lawyers to make it work. 

I always find it interesting how supportive folks are of the current way of doing things.  A larger company says "this is what is available, take it or leave it."  They have no problem with that company spending the piles of money they make on hookers and blow in the Caribbean.    But offer someone the opportunity to get a very niche figure produced for a discount, and the questions of 'what's in it for me?' pop up.  Or, 'you want me to help you out?' seems like a reasonable response suddenly.

I don't mean to sound harsh with the last paragraph as I'm enjoying the debate Luddite, just trying to get quick responses out at work.   

[i_am_win]

They have no problem with that company spending the piles of money they make on hookers and blow in the Caribbean.

Wow, if i had known that miniature companies had this in mind with the proceeds, I really hope that my next campaign gets 100%, although I think Amsterdam would be a better bet with the Hookers and the Blow....I would have started a minis company years ago...

[Leon]

After all, we already have a very large number of companies supplying a niche hobby.  Are there too many already?  Wouldn't it be better to consolidate all those into perhaps 1 supplier per scale?  
Who knows...

Very possibly, and I think we'll see a lot of consolidation in the next 10 years.  There are many companies which have sprung up on the UK circuit, in my mind, due to the economic situation, and people starting their own businesses as regular jobs are so insecure.  Unfortunately, not all of these will be able to survive beyond the 'honeymoon' period, and I think they'll slowly get bought up by the bigger guys.

This is probably a separate discussion though!

But offer someone the opportunity to get a very niche figure produced for a discount, and the questions of 'what's in it for me?' pop up.  Or, 'you want me to help you out?' seems like a reasonable response suddenly.

That's something I'd not considered actually, and it does ring true.

From my past Indiegogo campaign I have learned a great deal, and even though I failed epic (yeah, I suppose I underestimated what was needed in the first place, etc.....) I am still going to relaunch with a kickstarter next year. I am in the process of getting the sculpts done one at a time as and when I can afford it (Getting the greens done first would have probably got more support in the first place)

I was surprised that your project didn't get off the ground, and as I followed it, I did wonder whether it would have received a more positive response through Kickstarter?  

So they're just not going to happen?

They'll happen, just not through this method.  Our requests method is similar, the only difference being that we don't ask for any money up front!

It's got to depend on the overall popularity of 'the period' with so many other ranges available at present.

I think that's the key for us, in that we've already covered all the popular mainstream stuff now, that any new range only appeals to a smaller group anyway.  That's the theory behind the requests, where we can see how viable it is to create something.  There are still ranges/items we've never turned a profit on, and some we never will do, but they can be balanced out against the solid sellers like WW2, Naps, ACW, AWI, etc, etc.