Kickstarter and Big Business: A Dangerous Union

A little over a year ago, the Kickstarter craze began. You can trace the roots of the phenomenon to a joint project between 2-Player Productions and video game developer, Double Fine. The project went on to garner $3.3 million and prove to the world that Kickstarter was a legitimate home for crowd-funding  Since then, the Kickstarter projects have come pouring in. Small but amazing games have thrived in the Kickstarter environment, resulting in such fantastic titles as Faster Than Light. In 2012, games accounted for the most successfully funded projects and the most income to Kickstarter. However, the future of Kickster has become a troubling question as the website attempts to balance its indie-friendly image with larger, more popular, projects.

It is often hard to remember, with all of the goodwill it has cooked up over the last year, that Kickstarter is first and foremost a business.  The more money that is raised per page, the more they turn a profit as a business.  Thus, when a project like Double Fine Adventure, or Project Eternity from Obsidian make multimillion dollars, the profit margins for the company are considerably higher than when a two person team get $1,000 for their new iOS project.  However, the company’s business model is strong as they basically rent the web space, do the promotion for the campaign, then send the backers and project off into the world married to one another with no further weight on the company.  Its hands off, non-stress, and profitable.  Kickstarter has made it apparent that they have little interest in policing their site and will leave the door open to anybody.

But that is exactly one of Kickstarter’s biggest problems, that anyone can use it. You may think that I am referring to uneducated or unqualified people making promises on Kickstarter that they can’t keep, but I am not. Most people who put together Kickstarter pages have done an impressive job with showcasing their talent and laying out their long term vision. It is rare for an inept developer to get the ball rolling on Kickstarter. The bigger problem that Kickstarter has is its open forum nature attracts celebrities and large companies. The argument was quickly raised after the success of Double Fine and 2-Player Productions if Kickstarter was the future of business, using crowd-funding as a legitimate way of testing the market for monetary enthusiasm before taking large financial gambles.

The problem with this is that Kickstarter begins to lose its focus and goodwill. The site was originally designed to give the independent artist a place to pitch their once-in-a-lifetime idea to an audience. A group of individuals could throw what money they could at the artist and help make their dreams a reality. On a small scale, that idea is exactly what Kickstarter is all about and should be applauded. However, the commercial side of Kickstarter is something different altogether.

The most recent big money Kickstarter project was the recent drive to get a Veronica Mars movie. The campaign was promoted with a short film in which the stars of the series and creator come up with an idea on how to make the movie. At first, there was skepticism about the logistics of getting a movie, especially a studio film like Veronica Mars, made on the measly $2 million the Kickstarter was asking for. But then a deeper realization struck, as it was mentioned in the write up that Warner Bros would back the movie if the Kickstarter got high enough. This is troubling on multiple levels. Essentially Warner Bros, is looking for fans of the show to donate $2 million plus to the cause. They didn’t send out a survey to fans of the website, didn’t do market research, or focus testing, they simply said to the fans of the show, “You want this movie? Pay $2 million for it”. What is more troubling is that there is no guarantee that the movie would be properly funded or given the attention paying fans deserve.  How much will Warner Bros put into the film after the fans are done donating?  Is this what Kickstarter has become? A place where fans of entertainment go to donate their money to multimillion dollar corporations? If Warner Bros, releases the film and it is a roaring success, they will make millions of dollars, not the fans of the show who were the first to throw their money down.

One of the most eyebrow-raising Kickstarter campaigns was when Gas Powered Games turned their campaign for a new RPG called Wildman into a fund to keep their company afloat. While video game companies going under is never good and it is truly saddening to hear about people being laid off, it is not the responsibility of the Kickstarter crowd to ensure private or public companies stay in business. There is a fundamental difference for a game designer living in his parent’s basement, asking for $5,000 to keep his dreams alive and an established company trying to avoid going under due to the Dungeon Siege franchise running out of steam.

It always seems like world has good ideas, then big corporations find a way to get involved and ruin everyone’s fun. The free-to-play model used to be a way for small developers and publishers to allow everyone to try their game and pay what they could to keep it going. Now it is used to monetize struggling MMOs and ensure that someone spends $120 over the course of a year, instead of $60 upfront. How long is it before we find companies like EA start saying they want a $2 million pledge before they make another Mass Effect game, or Ubisoft asking to see an upfront investment for the next Far Cry? I hope this not the future of Kickstarter, that it can maintain its image of helping the little guy find a path to success. But it will be hard to see the little guy with all the giant companies standing on top of him.

What do you think the future of Kickstarter is?  Did you donate to the Double Fine Adventure game, or Veronica Mars?  Or maybe you’ve put your money toward smaller projects?  Let people know you thoughts in the comments below