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Former Double Fine COO launches new video game funding platform, Fig
- Thread starter serversurfer
- Start date
The COO of Double Fine may be Fig's founder, but Fig is -not- part of Double Fine.
He's no longer the COO of Double Fine, he works full-time for Fig as the CEO. Which is why I think the title should either say "former Double Fine" or just not mention DF.
glaringradio
Member
Assuming the numbers are reported correctly and accurately, on Outer Wilds there are currently 47 supporters, with only 45 of those supporters actually showing as backing the project on the page accounting for $2230 of the funds raised so far.
Does that mean that potentially the other 2 "supporters" have invested $34,235 between them on the project? Because that seems shady as fuck...
EDIT: Just to clarify, by shady as fuck I mean really a project should be open and honest about exactly where the money is coming from in backing a project. Saying 2 people are "supporting" the project, when really what they've given it a huge cash injection towards investment and a return on that just doesn't gel well with me. Especially when you have KickStarters that fail to reach their goal, but end up happening anyway because a publisher makes it happen. I don't feel they should be showing any funds raised on the page at all unless they have come from supporting the project by pledging towards a tier. Seems very misleading.
Does that mean that potentially the other 2 "supporters" have invested $34,235 between them on the project? Because that seems shady as fuck...
EDIT: Just to clarify, by shady as fuck I mean really a project should be open and honest about exactly where the money is coming from in backing a project. Saying 2 people are "supporting" the project, when really what they've given it a huge cash injection towards investment and a return on that just doesn't gel well with me. Especially when you have KickStarters that fail to reach their goal, but end up happening anyway because a publisher makes it happen. I don't feel they should be showing any funds raised on the page at all unless they have come from supporting the project by pledging towards a tier. Seems very misleading.
Lactose_Intolerant
Member
How does that change anything that I said? Tim Schafer is on the board, he obviously is going to be using Fig unless they run into legal issues.
a secret-boss
Banned
Inafune is intrigued
Red Ash 2.0 lives
Red Ash 2.0 lives
The issue with not showing how much money the investors put in the project is that the idea (from what I understand) is for investors to also help a project happen, alongside with backers. And I can see why they would like to keep their names private. Also, at least for now they must be Accredited Investors.
serversurfer
Member
Thanks. Added.
Sorry about that. I (basically) just copied the title from GI.biz.
Yeah, I was thinking the same. With proper curation, that could mean fewer failed projects. That said, I don't see any particular reason to "artificially" limit the number of projects running at any given time. If a million dollars is invested, Fig should be getting the same cut, whether it's invested in two games or ten.
Yes. The JOBS Act was suppose to create an avenue for non-accredited investors to partake in ECF. However, the SEC has been very slow to update and define the rules. Some states have taken it upon themselves to do so but it still remains an area full of ambiguity. There is a pretty large burden on the part of the startups in order to seek investments from non-accredited investors.
No problem, luckily people haven't jumped on it as much as I was prepared for.
I would really like to hear more about how they're handling the investment aspect or is it more of a case-by-case basis that can legally be more easily curated. It is a veritable source of troubles, but doable (hopefully).
SerTapTap
Member
Is there any reason to believe the accredited investors definition will actually be changed in time for them to make good on their statement? I know there's some proposed changes but I'm pretty sure I've heard that before in regards to kickstarter/etc over a year ago and nothing's panned out.
The SEC was suppose to issue a ruling in 2012/2013 and haven't done so yet. This is a highly debated area with many consumer protection groups being vehemently opposed to this idea. Folks need to realize that the vast majority of businesses fail and these are extremely high risk investments.
This is the part that's interesting.
Angelus Errare
Banned
I see Fig is hiring. I wonder what they're paying for that full-stack position. I imagine the gig will last like 3 years tops (because I don't see this taking off).
Might apply.
Might apply.
Sectorseven
Member
Angry gamers with co-ownership of the product, exactly what every developer wants.
SerTapTap
Member
I understand this is a concern, but I don't personally view this as a more relevant thing to "protect" the poor/middle class from than gambling and payday loans which are easily accessible ways to piss all your money away (depending on the state I guess, most places seem to have a least a state lottery though)
Stumpokapow
listen to the mad man
I don't see the major advantage here. I mean, more power to them. KS doesn't "deserve" anything, they should always have to stay hungry and fight competition. I'm all for people launching other crowdfunding sites. I just don't really get the model.
1. The "how far along are you" thing is already something you can add to your KS. I guess building it in is handy, but who are these campaigns that want to share the information but won't add 20 minutes of work to their KS to share it? The same is true for a lot of the game specific features. The asset carousel with the videos and stuff is pretty cool, but again are there KSes who have video assets to share but can't figure out how to do it? The other thing here is that, like, to the extent that these are major presentational advances, there's no reason KS wouldn't copy them. Games are a major part of their funding, there's no reason they would draw a line in the sand at adding features specific to the category.
2. "Accredited investors" can already invest in a KS, as they routinely do if the company is looking for them; it's just not through the structure of the site. Why would it be? Clearly profit sharing and equity (I assume most investors would far rather an equity share in the company than a profit share in the game) would require manual conversation between investor and receiving company. The most common KS investment arrangement is a publisher picking up a KS game after the fact, which can't happen here. And actually, the profit share here makes it less likely for post-funding investors to get involved because there's less profit share to give away on the game, right?
3. Even when you expand it to Joe Schmo, I can't see this being the sweetener that makes a project that wouldn't otherwise get funded to get funded. When people don't fund projects, it's often a lack of faith in the project. Profit sharing doesn't change the numbers on your risk as an individual pledger, because the vast majority of individual investors would make infinitesimal profits (my napkin math can't really find a believable scenario where backers make more than a small fraction of their pledges back, using real funding numbers from major KS projects and SteamSpy sale numbers and running different profit sharing projections and different ASP numbers)
3. "There are lots of game projects on KS, you get more visibility here". That's self-defeating. If this gets popular, then this will no longer be the case. If it doesn't, then this will be a bad thing because KS will bring more traffic. Also, the article claims that KS is bad because half the projects on it are fantasies like "buy me a Minecraft server" level stuff. Sure, I can dig it. But those signal-to-noise ratio issues aren't impacting major projects. It's not like people couldn't find Red Ash from browsing KS. Discovery on KS is quite good. I don't think the converse is really true either; obviously if your project is big enough people will fund on any site, so I'm not saying projects will be lost here either. I just don't see the comparative advantage.
One area where I do see the investment thing helping is maybe encouraging companies to be a bit more honest with their budgets. Right now if you need $500k, but you think you can get $200k from investors, you should ask for $300k on KS. Here there's... somewhat less motivation to deceive, although still some motivation.
A massive cut equal to 5% plus payment processing fees (the latter of which are positively unavoidable, and they're using Stripe, so they're paying comparable to what KS pays with Amazon Payments). The investment makes the effective cut actually higher from a developer POV. Now, this could be a net good because Fig maybe brings more pledges than KS would (since currently those investments don't give any profit share to backers). But then we've gotten away from talking about the "massive cut" and we're back to talking about ROI.
1. The "how far along are you" thing is already something you can add to your KS. I guess building it in is handy, but who are these campaigns that want to share the information but won't add 20 minutes of work to their KS to share it? The same is true for a lot of the game specific features. The asset carousel with the videos and stuff is pretty cool, but again are there KSes who have video assets to share but can't figure out how to do it? The other thing here is that, like, to the extent that these are major presentational advances, there's no reason KS wouldn't copy them. Games are a major part of their funding, there's no reason they would draw a line in the sand at adding features specific to the category.
2. "Accredited investors" can already invest in a KS, as they routinely do if the company is looking for them; it's just not through the structure of the site. Why would it be? Clearly profit sharing and equity (I assume most investors would far rather an equity share in the company than a profit share in the game) would require manual conversation between investor and receiving company. The most common KS investment arrangement is a publisher picking up a KS game after the fact, which can't happen here. And actually, the profit share here makes it less likely for post-funding investors to get involved because there's less profit share to give away on the game, right?
3. Even when you expand it to Joe Schmo, I can't see this being the sweetener that makes a project that wouldn't otherwise get funded to get funded. When people don't fund projects, it's often a lack of faith in the project. Profit sharing doesn't change the numbers on your risk as an individual pledger, because the vast majority of individual investors would make infinitesimal profits (my napkin math can't really find a believable scenario where backers make more than a small fraction of their pledges back, using real funding numbers from major KS projects and SteamSpy sale numbers and running different profit sharing projections and different ASP numbers)
3. "There are lots of game projects on KS, you get more visibility here". That's self-defeating. If this gets popular, then this will no longer be the case. If it doesn't, then this will be a bad thing because KS will bring more traffic. Also, the article claims that KS is bad because half the projects on it are fantasies like "buy me a Minecraft server" level stuff. Sure, I can dig it. But those signal-to-noise ratio issues aren't impacting major projects. It's not like people couldn't find Red Ash from browsing KS. Discovery on KS is quite good. I don't think the converse is really true either; obviously if your project is big enough people will fund on any site, so I'm not saying projects will be lost here either. I just don't see the comparative advantage.
One area where I do see the investment thing helping is maybe encouraging companies to be a bit more honest with their budgets. Right now if you need $500k, but you think you can get $200k from investors, you should ask for $300k on KS. Here there's... somewhat less motivation to deceive, although still some motivation.
Lime said:
A massive cut equal to 5% plus payment processing fees (the latter of which are positively unavoidable, and they're using Stripe, so they're paying comparable to what KS pays with Amazon Payments). The investment makes the effective cut actually higher from a developer POV. Now, this could be a net good because Fig maybe brings more pledges than KS would (since currently those investments don't give any profit share to backers). But then we've gotten away from talking about the "massive cut" and we're back to talking about ROI.
PoweredBySoy
Banned
Fuck making interesting games happen.
Sucks to be you.
Aren't you such a special snowflake? Congrats!
Yeah, that's some very heavy investments from a few wealthy investors. Means they'll get a much larger pool of the profit...
Stumpokapow
listen to the mad man
Here's an example of why I don't feel KS discovery is a real problem. Suppose I have never been to KickStarter, and I am interested in finding viable game projects. Here's what I should do:
Kickstarter -> Discover -> Games
Refine Search
Games -> Video Games
Advanced Search -> Live Projects
Goal ->
1mil+: I see three games, all of them are unserious (0% funded, descriptions plainly indicating inexperienced or amateur developers). Okay, so there are no megaton big projects running right now. Next...
100k-1mil+: 23 projects. 20 of these projects are unserious, and KS's default presentation sorts those last. The three projects that you might want to consider are first. Just based on the one sentence blurb on the page, 2 of the 3 games are made by people who have experience. Checked the third one, and it's made by experienced developers too. 2 of the 3 games appear to have some chance of being funded. I think GRIP is toast, tbqh. Eco looks cool though, I'd give that a second look. Did a five second scan through the other 20 projects to see if any looked even in the slightest bit appealing, and they didn't.
10k-100k: 96 projects. Okay, we're in the meat now. By KS's default sort, the bottom 16 of these are all 0-pledge 0-chance campaigns, and so were I'd guess around half of the other ones. It takes about 5 minutes or so to scroll through all the projects and open tabs for the ones worthy of actual consideration. Another way to do this would be to sort by End Date. If a project is above 65% and in its last few days, it's probably going to get funded. If it's at 10% in its last day, it ain't happening.
Ta-da, you've done all the discovery you need to do on Kickstarter for the month, come back next month. If you really really want to support no-name indie stuff no one has heard of, you can go to the 1k-10k range, but at that point you're clearly someone who likes to learn about indie games as a hobby, so discovery isn't a problem for you, it's a good way to kill an afternoon.
Of course 99% of people don't even need to do any of this, because they would simply hear about major projects through their preferred news source and find those.
Kickstarter -> Discover -> Games
Refine Search
Games -> Video Games
Advanced Search -> Live Projects
Goal ->
1mil+: I see three games, all of them are unserious (0% funded, descriptions plainly indicating inexperienced or amateur developers). Okay, so there are no megaton big projects running right now. Next...
100k-1mil+: 23 projects. 20 of these projects are unserious, and KS's default presentation sorts those last. The three projects that you might want to consider are first. Just based on the one sentence blurb on the page, 2 of the 3 games are made by people who have experience. Checked the third one, and it's made by experienced developers too. 2 of the 3 games appear to have some chance of being funded. I think GRIP is toast, tbqh. Eco looks cool though, I'd give that a second look. Did a five second scan through the other 20 projects to see if any looked even in the slightest bit appealing, and they didn't.
10k-100k: 96 projects. Okay, we're in the meat now. By KS's default sort, the bottom 16 of these are all 0-pledge 0-chance campaigns, and so were I'd guess around half of the other ones. It takes about 5 minutes or so to scroll through all the projects and open tabs for the ones worthy of actual consideration. Another way to do this would be to sort by End Date. If a project is above 65% and in its last few days, it's probably going to get funded. If it's at 10% in its last day, it ain't happening.
Ta-da, you've done all the discovery you need to do on Kickstarter for the month, come back next month. If you really really want to support no-name indie stuff no one has heard of, you can go to the 1k-10k range, but at that point you're clearly someone who likes to learn about indie games as a hobby, so discovery isn't a problem for you, it's a good way to kill an afternoon.
Of course 99% of people don't even need to do any of this, because they would simply hear about major projects through their preferred news source and find those.
Stumpokapow
listen to the mad man
Are people really going to shill for a dollar or two?
Imagine that profit sharing is done proportional to pledge investment. Imagine that a game fundraises 3.3 million dollars and needs no external cash infusion (pretty unlikely in the KS world). Imagine that the game releases and goes on to sell 190,000 copies on Steam at prices from $6-25. We'll say an average sale price of $15 (so it earns $10.50 a copy). That's about 2 million dollars in profit. If 100% of the profit is redistributed, people get around 2/3rds of their pledge back. But that's crazy, because then the studio shuts down because it can't pay salaries. So, instead, let's say 20% of the profit is redistributed. You get back about 12 cents on the dollar. As an average person, say you donate $50, you get $6 back. Say you donate $100, you get $12 back. This is notably after two or three years of development. And there's risk because not every game is going to release, and not all of those that release are going to sell a couple hundred copies.
This is napkin math, of course. All of these figures are just hypotheticals. Maybe the profit sharing will be higher. Maybe most games sell more copies relative to their pledge intake. I don't know. But I figure to the extent that any of those assumptions might be too conservative, the assumption that the game doesn't take external funding is exceedingly generous.
You should read the Polygon article. The idea is to curate very, very carefully which games will be allowed to get on Fig. They don't want a scenario where hundreds - or just dozens - of projects will fight for attention on Fig.
"The other key to making Fig successful is not to flood the market, so to speak, with equity crowdfunding opportunities. Part of what makes Kickstarter so challenging, Bailey said, was the sheer volume of projects going live on the service every day. With Fig, there will only ever be one or two campaigns live at any time. It will be up to the advisory board to pick them."
If that's a good thing is another matter, though. Seems like limiting yourself to just one or two projects at a time won't really help you to get off the grounds.
Gambling and Investing are not the same thing but I understand your analogy. I don't necessarily agree with the consumer protection groups but their concerns are legitimate. Under the Securities Act of 1933, any offer to sell securities must be registered with the SEC unless it meets certain criteria to be exempt. REG D contains the rules listing these exemptions. Rule 505 and 506 are what's at issue.
PoweredBySoy
Banned
Uuugggghhh being fiscally responsible and having all this money is such a burden.
Sumio Mondo
Member
I like the approach for quality over quantity. Kickstarter and Indiegogo aren't going anywhere, so let's wait and see on this. Pretty cool for it to be an investment instead of a charity now, might encourage more people within the industry to support the idea too.
zenosparadox
Member
The interesting thing about profit sharing is generally people that invest money feel that they should have a say in the creative process. I wonder if Fig will separate creative control from investors, or maybe that will be left up to the developers on a per-project basis.
serversurfer
Member
I see where you're coming from, and sure, there are risks in any investment, but there are also rewards. The same can be said for the developers themselves, for that matter; there's no guarantee they'll get any return on their three-year investment either. But as I said, there are potential rewards as well. In your example, if the game sold 1.9M, you'd be getting 120¢ on the dollar, right? Of course, then your return is predicated on your ability to accurately pick winners based on potential, but again, that's true of all investments. And while the curation certainly won't ensure huge success, it should help to minimize projects which completely fail to launch, or are horribly broken, etc. Also, it will likely depend on the individual project, but even if/when investment is opened to the general public, it's likely not all donors will be considered investment tier and even be eligible for profit sharing in the first place.
Stumpokapow
listen to the mad man
this seems like kinda a stupid thing to lord over people. you're on a video game forum. yes, people buy video games. you do too. i have no doubt that lots of KSers make stupidly high pledges for garbage they can't afford, but that's not inherent to the format. no one is begrudging you that you are more risk adverse than others, just the rubbing in people's noses
The ideal scenario is that someone funds a game that's a break-out multi-million unit hit and you're the only person that pledged it. But I think in reality there's a high correlation between success on Steam and initial support, so most likely the games that are going to go on to sell 1.9 million will dilute the profit sharing further. I guess there are probably exceptions with crazy left-field stuff, but I'd expect most of that stuff has significantly higher downside risk. (I mean, this is obvious: you can't make money from nothing!)
This makes sense, but it's also going to be something that limits the umbrella effect and thus the maximum funding level. Like I said, if your project is drawing people to KS then this isn't going to hurt you, but if your project is drawing people from KS then this seems like a downside.
mgs2master2
Banned
So they get 10%... like kickstarter. also investing is 1000 dollars minimum? lol okay.
Plus the 3 individuals named are people i wouldnt trust with money anyhow. good luck to them, but i rather stick with KS than this.
edit: wait. 5% of sales in perpetuity? so they are essentially taking more than 10% if I am getting this right. What the hell?
Agreed.
5% of funds raised + 5% of sales in perpetuity is a much worse deal than 10% lump sum....
Nonexistent? Oh shit. Deleting Outer Wilds from my HD as we speak.
Stumpokapow
listen to the mad man
Looks like Fig takes 7.9% + rounding error upfront (KS takes 8% + rounding error upfront), and Fig takes some backend sales as well. So this is definitely not something that's competing on service overhead.
TouchMyBox
Member
Are they going to be screening projects to try and minimize scams and just outright shoddy work?
I'm guessing that 7.9% doesn't include payment processing?
I'm guessing that 7.9% doesn't include payment processing?
Stumpokapow
listen to the mad man
That's including payment processing.
The Polygon thing says they're taking 5%, and they use Stripe (2.9%+change) for payment processing. KS takes 5% and uses Amazon Payments (3%+change) for payment processing.