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Why crowd funding is bad
PioneerStew
Member Posts: 874
Crowd funding, to me, is the scourge that has recently hit the gaming world and here is why: -
- Some people seem to believe it is an investment. Go and tell your friendly local financial advisor that you are investing in a crowd funded project and prepare to be laughed out the door. It is not investment, you are effectively gifting a company money to profit off of your goodwill.
- It is neither an investment in a business or a donation to a charity, and as such you are currently not protected by any regulation.
- There is no legal recourse if they do not deliver. None.
- Kickstarter as an example skims 5% off all successfully funded projects but absolve themselves of all responsibility to check the viability of said projects. This is money for old rope; or payment for funder's ignorance.
- If the project is not delivered, yet it achieved its funding the best you can do is send an angry e-mail.
And here is the worst part of it all: -
- Companies generally require finance to proceed with a project. In so doing they need backers, shareholder or loans; all of whom apply strict criteria to the delivery of the project in terms of budget and programme in order to obtain a return on their investment. Crowd funders do not have this ability.
- You simply have no control; a budget or programme can be extended or reduced or absolved all together.
- and if off the back off your hard earned cash, the company is successful they keep 100% of their profits with no outlay or risk whatsoever, off of the back of your money.
This is the most hideous and mercenary misuse of people's goodwill I have had the misfortune to ever see.
Please share your thoughts.
Comments
If it was a manufacturer of kitchen sinks you would not feel the same way. Stop thinking with the heart and start with the head.
If it were the manufacturer of cheeseburgers...you WOULD feel the same.
Stop thinking with your head and start thinking with your appetite!!
:P
"This may hurt a little, but it's something you'll get used to. Relax....."
Well if I kept wasting my money getting sinks that leaked or had something wrong with them and then some person came along with a new sink design that was perfect for what I needed but needed my help to crowdfund because no big company would touch it for some reason then, yes, I'd feel the same.
Your initial post is, at least mostly, not wrong but I don't understand why if someone goes into it knowing the risks and chooses to use a small amount of money to back a crowdfunding project its such a bad thing. You seem to be assuming that they only possible motive anyone would have to put money towards something is thinking they will make profit or a return out of it. Crowdfunding has a completely different mindset.
this would probably be better titled "Crowdfudning is not the same as being a shareholder"
to which my response is NO WAY?
You got me
The same logic could be applied to pyramid schemes. I just see it as profiteering off the goodwill of others without taking any of the usual risks involved in a project of this type. I find it mercenary and unpleasant.
Sure many people who look for crowd-funding are legit, but many more are arseholes as in all walks of life.
I disagree with you OP. Kickstarter is the BEST thing that has happened to humanity.
Think about it. Risk free money. Money you can use that others have provided. People who would have wasted it anyway. In a way, kickstarter is a charity because you are extracting the money from those who squander it and put it into the hands of those more able-minded.
You can use other peoples' money to do as you please. Just put up a flashy video, promise the world and you're set. Now even you can be an investment banker (think JPMorgan Chase), gambling with other peoples' money. Did I MENTION it was risk free? If you fail, the governement or in this case, the backers, have your back. Like you said, all profit goes to you, all losses go to your funders.
100% profit, no losses.
It is therefore the next step in human development. In the early days, you took a loan and gambled your life to develop your vision. When your product was out, you could see wheter that vision was foolish or briliant.
Next, some geniusses thought of selling the alpha and beta. Why wait to sell a complete product if you have people who are willing to pay to test a game for you? Whoever thought of this was a very blessed man. However, it could still backfire because a shitty alpha/beta could give you bad marketing, making the product sell like crap.
Now, the next step is the epitome of human ingenuity. I think God himself must have introduced this concept because I cannot fathom that a mere mortal would have thought of something so smart. Instead of selling something tangible, why not sell dreams and visions? Your mind will always make them look good, it's like autocorrection on word. There is litterally no way to fuck up a dream, it will always look good because the human mind is moldible. Put up some good flashy concept art, give the impression you can do it and let the cash flow stream! Should some of the backers become more wise and criticise some of the crap you put out, justify it by saying it's pre-alpha! They will swallow it like sweet candy!
In fact, I think we can already spot the next step in gaming which is having a cash shop for a game that does not exist yet. Just tell people they are part of the development and are special (LOL!) by giving you free unrestricted cash. Additionally, I think big companies are already having kickstarters, to alleviate the wealthy shareholders and pump up the profit. IMO they are doing the work of God by taking the cash of those who would have squandered it anyway and put it into the hands of those who are more money-savy. As momma always said, do not let things go to waste. If people are giving it to you freely, who am I to say no?
So can you see, my friend why it is the best thing ever? Why let money go to waste in the hands of those backers when you can put it to good use?
Star Citizen. Nice post.
It's all relative.
People who backed a failed idea and didn't get refunded will think it's bad.
People who backed a succesful crowded funded idea will think it's good.
I don't think it's bad.
What I find strange is when gamers find the AAA MMO titles being released by the big boys garbage and DON'T pledge into an idea.
You can't be that interested in the hobby if your not willing to fund an idea.
Crowd funding is not actualy for game company's that need money.
Itt was invened for "perons" that did not have the funding for somthing.
Like a guy thats poor and needed a wheelchair.
Or a single mom with a child that needed some special glasses and could not aford them.
But nowday's with so many just plain and bad ideas that everyone knows is going turn out bad.
The normal investors that normly would invest in the game dont wanna tuch it with a ten foot pole.
So they put their games into "crowd funding" to see if other peeps want to go with they dumb idea's.
If investors dont want anything to do with it, well that says enough about the game.
Moost of the time the games have "one" single person who did somthing somwhere back in time that worked.
Like hey i made "wingcommander" it was a hit 50 years ago i can do it again.
Hey i am sir "bladibla" i made Ultima online 50 years ago it was a hit i can do it again.
(if he did not spend millions going into the ISS space station he could invest in it him self but he did not)
Crowd funding is all about marketing and hype.
Project does not have to show asset worth.
Project does not have to even use the money for the said project.
Project can run unlimited campaigning on multiple sites.
Project has to build their own hype through marketing. aka news on major sites.
Crowd funding fraud is not punishable as federal crime.
Crowd funding is not for business startup but loopholes exist for such.
These things may get fixed soon.
If you are interested in making a MMO maybe visit my page to get a free open source engine.
Can I haz cheezeburger?
we were talking about crowd funding and suddenly I'm hungry for cheese burgers. I'd like to invest in some cheese burgers, going to look for crowdfunding for burger joints.
==========================
The game is dead not, this game is good we make it and Romania Tv give it 5 goat heads, this is good rating for game.
faster way to make your own!
https://www.kickstarter.com/projects/1389924514/the-burger-master
EQ2 fan sites
The problem isn't crowdfunding, its the way its described in the gaming media and by fanbois and that's by no means something exclusive to crowdfunded games.
The hype for kickstarter started due to Tim Schafer's Double Fine Adventure kickstarter, now known as Broken age. This led to multiple high profile names starting kickstarters, gaming media spread the word and a lot of kickstarter gathered a lot of money. The risk for kickstarter was marginalized by pretty much everyone, and that's the exact problem with crowdfunding.
More people are aware of those risks today, the massive funding that happened in 2012 and 2013 doesn't happen in 2014, except for the rare project. That's not to say that the spending spree didn't result in good things, if it hadn't been for kickstarter we wouldn't have had Shadowrun returns, divinity: Original Sin, Wasteland 2 and soon to be released Pillars of Eternity.
I think its a sane thing that people criticize game developer projects, the real problem are fanbois that think they are doing a service by writing developers a blank check, and the gaming media that doesn't ask the hard questions. Gaming media should be for the players, and not a promotional tool for publishers.
I agree with many of the points the OP makes.
Crowdfunding has its place imo. In this time of rampant marketeering, it's very hard for any radical new projects to emerge, projects that don't fit into the strict little statistical analysis that marketing departments shoehorn many developers into. Kickstarters and the like can help to let those projects see the light of day.
Similarly, some charitable goals have also found their way through crowdfunding. Some redistribution of wealth in that way is a pretty good thing.
BUT, this whole thing has been growing way too fast for any sort of regulation to follow suit. People are also not being critical enough of the stuff certain naive individuals are proposing.
Money is thrown at projects that are unlikely to ever get finished or are run by people who have no clue what they're doing. I've personally had to interview people who were trying to set up a project for local windmills with crowdfunded money where not a single individual involved was an actual engineer who knew anything about windmills. It was set up by a bunch of idealistic social scientists who didn't have the first clue of the practical implications of their plans. Still, it got funded, result: nothing has happened since, only a few open letters have been sent.
Finally, in terms of redistribution of wealth, the truly rich will probably find their way to investments that actually give them a return far more easily due to having the correct financial advice and instruments at their disposal.
Feel free to use my referral link for SW:TOR if you want to test out the game. You'll get some special unlocks!
Crowdfunding is the BEST thing to ever happen to gaming. The very best because it allows the consumer to guide the direction MMO's will take. I can guide the direction by funding those projects that say they're going to try to make what I want.
Too many people want to be protected in this world. If someone rips me off, then I certainly won't invest in them again and if it happens too many times then I won't fund anything. Even if the latter happened I'd think it was a great thing.
I like to gamble a bit, I usually take $200 and play with it until I run out. I don't go over my limit, I don't feel bad about losing that $200 because it's the cost of gambling. I see this as the same thing. I'm willing to gamble and if I lose I went in prepared to lose.
Instead of the negatives I'd like to take a look at the positives. I'll use Star Citizen as an example because they're the king of funding. I've always wanted a game that had space battles, space boarding, FPS, trading and land based game play. Now I get to gamble on this game. I can send a real monetary message to devs that this is the kind of game I want. If I win my gamble I get something I've really wanted for a long time. If I lose, I lose less money than I spend on a single Xbox game that I'm not all that happy with.
If you're not a responsible person don't gamble either with funding or at the tables. I am a responsible person and don't need or want your protection.
Asdar
yes everything u said is correct from business point of view, but you are missing an important concept and that is to help independent companies and people to get something ((you believe its good)) done,for example i gave 50 euro to star citizen because i believe they can deliver a very good space game, i do not look for profit out of 50 euro lol what is in it for me?? the joy of playing very good space game when it comes out.
Crowdfundind is a tool. So, is the use people make of it that make it bad, good, evil or the best thing that happens to games. THe danger of misunderstanding that tool is great, people that think it is a an invest are sure wrong. Someone say that it is like gambling and it is a quite accurate observation.
The bad side is the lag of legal regulations. It is usual in internet, cause it changes quicker that lwas. But legal rules are needed.
The good side is that it make possible to perform projets that may be impossible to fund by tradicional ways. Se we could see interesting games (in this case) or many other projects not related with gaming industry.
The op said that local finalcial advisors would laugh out the crowdfunders...it is a joke isn´t it. Bankers always laugh of what could be a danger for its bussines. And crowdfunding is a relative danger for banks.
And then there are the well intended developers who have no business sense.
This is the situation that I think is the most prevelant risk. There are many talended developers who want to show what they can do and have great ideas and concepts, but when it comes to managing those financially,, well.............2 words.
Brad McQuaid
This falls into the "painting everyone with the same brush" scenario.
The idea behind crowdfunding is good but just like anything and everything including the worshiping of your favorite god it's open to abuse.
"Be water my friend" - Bruce Lee
Ah, the purpose of crowd funding is to support a business. They aren't creating stuff out of the goodness of their hearts. It's a business model. Now they're asking for money but when the game launches they will be charging for it. The purpose of a business is always to turn a profit or it's not considered a successful business.
There model is Pay to play. That's why people are putting money into it.
"We all do the best we can based on life experience, point of view, and our ability to believe in ourselves." - Naropa "We don't see things as they are, we see them as we are." SR Covey