Crowdfunding has really taken off in the past few years. Websites like Kickstarter, GoFundMe and Indiegogo have had a lot of success in helping to fund small development teams. But what’s really amazing about crowdfunding is that it is a new way for individuals to help create their own entertainment.
The biggest beneficiaries of crowdfunding are people with niche interests. For some time, if you wanted a certain kind of game, book or even music, you’d either have to wait for someone else to make it or do it yourself. By pledging funds to a prototype creation, you help support the creator by showing there is an audience for their product. It’s a great way for consumers and creators of niche genres to communicate with each other, especially when the consumers of niche content have been swept under the rug by the more popular genres.
The best example of this is the recent proliferation of metroidvanias. Most people remember these games as popular PlayStation One titles. We’ve seen little of these games in recent years. The lack of metroidvanias suggests there’s a lack of audience for such a genre. But when you look at the amount of people supporting metroidvanias through crowdfunding, that is clearly not the case. Bloodstained, developed by Koji Igarashi (maker of Castlevania), recieved $5 million from 65,000 backers. Indivisible has raised $1.8 million from 33,000 backers. There have been many metroidvanias pitched and plenty of them getting funded.
If there are supporters for a project, they will come. And it isn’t limited to video games. Unbound.co.uk is a website where you pledge support to authors who pitch ideas for books. With enough pledges, they’ll write the book and ship you a copy. Many short films have been created thanks to Kickstarter and Indiegogo, my favorite being “Kung Fury,” which I highly recommend.
Crowdfunding is really the ideal relationship between producers and buyers. It’s a great way for consumers to exert some control over the product they’re getting. This is an ideal excursion for people with niche interests.
However, it’s far from perfect. Many investors have been burned by crowdfunding projects that couldn’t deliver. In 2012, there was a massive string of products on Kickstarter that promised much and delivered little. Since then, Kickstarter has rewritten the terms and services on their website, now demanding that all products must present a working prototype of the product before they can request funding. Crowdfunding is still more of a donation process. There’s not much these sites can do to guarantee against mishandled funds or outright scams. Though there have been relatively few serious cases, equity crowdfunding lacks any kind of serious regulation. The first successful court-ordered restitution against a delayed Kickstarter project took place only a few months ago.
Many of these failed products come from a lack of proper budgeting. Project managers with little understanding of finance will make their funding goal too low, and when that goal is barely met it’s often a guarantee that the developer will run out of money. For that reason, it’s usually much safer to support products that have a high goal with a larger team. However, nobody is free from risk.