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[Davey Cakes]

Goddamn. Making niche games profitable is a bitch, isn't it?

I haven't even completed the first Psychonauts. I'm working on it. I apologize if I'm not willing to spend $60 upon release of the sequel. It's just not my way.

I really wish there was an easier way for niche games to reach profitability and to be viable in general.

 

[Wowfunhappy]

I expect that there's some sort of misunderstanding here that will be cleared up within a few days. I have no idea what that misunderstanding could be, but I also don't think Double Fine is this reckless.

Mind you, I probably wouldn't be so unconcerned about this if I'd invested $1,000.

 

[NeonBlack]

https://www.youtube.com/watch?v=9uKIeamPi2Y

Honestly it was probably not a good idea to fund them after the whole Broken Age fiasco.

 

[zahran]

cant wait

 

[Erevador]

Fig's whole investment model is a perfect illustration of just how to miss exactly what it is that is so great and innovative about crowdfunding.

 

[Matt]

I expect that there's some sort of misunderstanding here that will be cleared up within a few days. I have no idea what that misunderstanding could be, but I also don't think Double Fine is this reckless.

Mind you, I probably wouldn't be so unconcerned about this if I'd invested $1,000.

There is no misunderstanding, and none of this is about DF being reckless.

As has been explained before in this thread, DF doesn't need to sell this many copes at $60 to make money, Fig investors do.

 

[LukasTaves]

Why do they keep doing this? Why would you spent a money on a sequel you know you can't possibly make it back and end up killing the franchise for good?

 

[Wowfunhappy]

There is no misunderstanding, and none of this is about DF being reckless.

As has been explained before in this thread, DF doesn't need to sell this many copes at $60 to make money, Fig investors do.

But this is almost certainly going to scare off a large portion of their would-be investors (since to my knowledge no one has actually committed yet). Presumably, they need that money to make the game.

 

[More_Badass]

Why do they keep doing this? Why would you spent a money on a sequel you know you can't possibly make it back and end up killing the franchise for good?

Ask the FIG investors. This doesn't affect Double Fine

 

[Aikidoka]

A Fig employee replied to that reddit thread:

The 30% is intended to be a minimum dividend amount, and we'll actively monitor our business conditions to see if we can dividend more than the minimum, but obviously no guarantees

Sounds really shady to tell people to trust in your generosity, but maybe I'm just paranoid.

 

[SilentRob]

https://www.youtube.com/watch?v=9uKIeamPi2Y

Honestly it was probably not a good idea to fund them after the whole Broken Age fiasco.

I'm a Double Fine fan and I don't want to turn into some kind of fanboy defense force here but I really feel like statements like this are utterly unfounded.

Broken Age is a well to very well received Point & Click-game that was released 1 1/2 years later than the initial estimate, which is only surprising if you completely ignore that the original estimate was in regards to a way, way smaller game with a 400.000$ budget. It was accompanied by one of the most informative, transparent and important documentaries ever made about game development. Every backer got what he was promised, albeit later than plannet. I will proceed to not link the uncountable delays every video game of every type encounter to make my point, since I think we are all well aware of that.

Since then DF have released Hack ' Slash, Costume Quest 2, Grim Fandango Remastered, Massive Chalice, Day of the Tentacle Remastered and Headlander in less than 2 years. They fucked up with Spacebase DF-9. They also developed and released 17 games in the last 5 years, some self-funded, some crowdfunded.

But this is almost certainly going to scare off a large portion of their would-be investors (since to my knowledge no one has actually committed yet). Presumably, they need that money to make the game.

The game has been funded for almost a year now and has been in development since then. If you want you can further invest into the game, help it along and hope for a profit - as you can do with every other game if you have the connections. Fig simply builds a bridge.

To make this as clear as possible: This does not mean that Psychonauts 2 needs to sell 2 million 60$ copies to make a profit. It means that at that point Fig investors, who now decide they want to investet bigger money in addition to the already crowdfunded amount from the campaign back in December, will make their money back.

 

[hollomat]

A Fig employee replied to that reddit thread:


Sounds really shady to tell people to trust in your generosity, but maybe I'm just paranoid.

Yeah that's what made me sure I hadn't missed something in the calculations. If the break even was lower the FIG employee would have pointed that out instead of stating they may raise the div payout if they're feeling generous. But they have no obligation to.

I'm a Double Fine fan and I don't want to turn into some kind of fanboy defense force here but I really feel like statements like this are utterly unfounded.

Broken Age is a well to very well received Point & Click-game that was released 1 1/2 years later than the initial estimate, which is only surprising if you completely ignore that the original estimate was in regards to a way, way smaller game with a 400.000$ budget. It was accompanied by one of the most informative, transparent and important documentaries ever made about game development. Every backer got what he was promised, albeit later than plannet. I will proceed to not link the uncountable delays every video game of every type encounter to make my point, since I think we are all well aware of that.

Since then DF have released Hack ' Slash, Costume Quest 2, Grim Fandango Remastered, Massive Chalice, Day of the Tentacle Remastered and Headlander in less than 2 years. They fucked up with Spacebase DF-9. They also developed and released 17 games in the last 5 years, some self-funded, some crowdfunded.

I'm a huge double fine fan as well and absolutely loved that documentary. I just wish they were more transparent with investors about this.

 

[More_Badass]

https://www.youtube.com/watch?v=9uKIeamPi2Y

Honestly it was probably not a good idea to fund them after the whole Broken Age fiasco.

You mean the time that a much-expanded game took longer to develop and release?

 

[Striek]

Yeah that's what made me sure I hadn't missed something in the calculations. If the break even was lower the FIG employee would have pointed that out instead of stating they may raise the div payout if they're feeling generous. But they have no obligation to.

Could be a lot higher too. See my previous post. The calculations you used are assuming Fig invests $1.8million themselves. As I posted, if they only invest $600,000 then it will take 13,000,000 copies to break even. Its all in the SEC page.

 

[Bulzeeb]

well I thought the first one wasnt bad but it was far from being the awesome game some users here hyped it to be, well, best luck for them because unless they manage to do something really amazin I wont be paying more than $15 on a steam sale for it

 

[hollomat]

Could be a lot higher too. See my previous post. The calculations you used are assuming Fig invests $1.8million themselves. As I posted, if they only invest $600,000 then it will take 13,000,000 copies to break even. Its all in the SEC page.

True. 2 million are the minimum for break even, but as you pointed out it could be a lot higher. A lot of investors are going to get burned.

 

[Maximo]

https://www.youtube.com/watch?v=9uKIeamPi2Y

Honestly it was probably not a good idea to fund them after the whole Broken Age fiasco.

Psychonauts is in my top 10 favourite games of all time, and even I didn't back this.

 

[SilentRob]

Yeah that's what made me sure I hadn't missed something in the calculations. If the break even was lower the FIG employee would have pointed that out instead of stating they may raise the div payout if they're feeling generous. But they have no obligation to.



I'm a huge double fine fan as well and absolutely loved that documentary. I just wish they were more transparent with investors about this.

What do you mean? The only reason you know about this is because they were transparent with it. This also isn't really up for debate. There are rules and laws for how this works and they are following them.

 

[koolaroo]

Who could have guess a Tim Schafer gig would be a bad investment?

 

[Wowfunhappy]

To make this as clear as possible: This does not mean that Psychonauts 2 needs to sell 2 million 60$ copies to make a profit. It means that at that point Fig investors, who now decide they want to investet bigger money in addition to the already crowdfunded amount from the campaign back in December, will make their money back.

I was under the impression that the "investor" portion of the funding hadn't actually gone through yet because Fig was waiting for new laws to come into effect. Is that not the case?

 

[CosmicQueso]

But this is almost certainly going to scare off a large portion of their would-be investors (since to my knowledge no one has actually committed yet). Presumably, they need that money to make the game.

And now you know why there are fewer AAA games being made now and why those that are made tend to take fewer risks.

Welcome to the upside down economics of big game development.

 

[Shaanyboi]

Guys... what are you doing?

 

[Whompa02]

so uhhh making a game for the fans I guess...

Yikes

 

[BigEmil]

Er....ok

Spoiler

not paying anywhere near $60 for this.

 

[PaulloDEC]

Who could have guess a Tim Schafer gig would be a bad investment?

People who don't know what they're talking about?

 

[Striek]

And now you know why there are fewer AAA games being made now and why those that are made tend to take fewer risks.

Welcome to the upside down economics of big game development.

Eh theres plenty of ways they could've structured the payouts to make it more equitable and assuming a reasonable budget and decent sales, a profitable venture.

*Don't increase payouts to DF (and thus less for investors) after $13,333,333 of receipts
*Reduce payouts to DF until investors (and Fig) have recouped their costs
*Don't base payouts to investors on how much Fig themselves invest
*Fig takes a smaller proportion until investors are repaid
*Fig only takes enough to cover costs after their own investment is repaid, until investors are repaid




Basically, at the moment, both Double Fine and Fig (but especially DF) have to make an absurd amount of profit before investors are repaid. The risk:reward for DF and investors stand at complete polar opposites.

 

[hollomat]

What do you mean? The only reason you know about this is because they were transparent with it. This also isn't really up for debate. There are rules and laws for how this works and they are following them.

They're only transparent enough as required by law. Back when the campaign was announced they had a chart that was adjustable and showed the breakeven point by number of copies sold and average price of copy sold. See the polygon link in the OP.

Now that they can actually accept money, the breakeven point is significantly higher than previously advertised. FIG didn't advertise or note this difference at all and has removed the chart for calculating break even. The only reason you'd know the break even increased is by reading the offering document (which everyone should do before investing in something like this) and doing the calculations yourself.

 

[LukasTaves]

Ask the FIG investors. This doesn't affect Double Fine

Sure, it's not their money, but they are they are the ones that asked/accepted the money and put in a project that has a very chance of flopping, would the FIG investors put any more money in their projects if this fails? In the very least they wouldn't touch the franchise again.

 

[Sword Of Doom]

Is Psychonauts actually good? I've seen videos of it and it seems like the writing and humor might be good, but the gameplay looked really uninteresting compared to other 3D platformers (Mario Galaxy 1, Mario 64, de Blob).

Yes it's a great game but if you're looking for a Mario game then you won't like it

It's a point-and-click adventure game disguised as a platformer.

Not really. I guess every game with an animated look in third person is called a platformer for some reason.

 

[Odrion]

https://www.youtube.com/watch?v=gjVmeKWOsEU

 

[Tabasco]

I guess every game with an animated look in third person is called a platformer for some reason.

Except it actually is a platformer, for those of us that have played it.

 

[SilentRob]

They're only transparent enough as required by law. Back when the campaign was announced they had a chart that was adjustable and showed the breakeven point by number of copies sold and average price of copy sold. See the polygon link in the OP.

Now that they can actually accept money, the breakeven point is significantly higher than previously advertised. FIG didn't advertise or note this difference at all and has removed the chart for calculating break even. The only reason you'd know the break even increased is by reading the offering document (which everyone should do before investing in something like this) and doing the calculations yourself.

I see, thanks for clearing that up. As you say I'm also of the opinion that anyone who actually wants to invest in something should have the sense of reading the actual, finished documents and not just follow estimates from a year before. But I can totally see how they could be a lot more transparent with this now, yeah.

 

[koolaroo]

People who don't know what they're talking about?

What? Double fine games have had pretty shaky success over the years. Psychonauts didn't sell well at launch. Neither did Brütal Legend. Broken age turned into a mess, along with space base. Sorry but Tim Shaffer seems like a kind of risky guy to invest money in.

 

[Sword Of Doom]

Except it actually is a platformer, for those of us that have played it.

Not sure if you're implying that I haven't played it but my point is that platformer is a broad term applied to a lot of games. To me psychonauts is an action game with platforming elements.


I wonder how this will effect funding. It sounds like a bad deal for investors but I wonder how people who normally help fund games on sites
Like kickstarter feel about contributed a relatively small amount for this game

 

[Raybunny]

Might be a little harsh but after Tim past actions and results to me he became a crook. Nothing will persuade me to bother with any of his projects. Adding Tim's name to Fig's platform rings something from a world that exists surely in nightmares.

Aside that Psyco game was alright.

Now regarding the main post, for non main investors it's quite a hit and miss situation.

 

[CertifiedFP]

Well, if there's one thing I like about FIG, it's that since it has to obey SEC regulations unlike Kickstarter, it has made it very transparent why these games were rejected by traditional publishers.

It's why I've never backed and - With one exception - never will put money onto a Kickstarter campaign, speaking as a man who has money in the stock market. If someone with a history in the AAA publisher space is presently relying on crowdfunding, it's a Red Flag for me that they've failed professional investors too many times and have been given The Boot. Tim Schafer is The prime example of this, and his crowdfunded history has only reinforced this for me even more.

Trust me, they never go to Kickstarter because they're "seeking independence". They go to Kickstarter because no one in the industry who's serious wants to slit the money wrist for them again after doing it multiple times before.

 

[PaulloDEC]

What? Double fine games have had pretty shaky success over the years. Psychonauts didn't sell well at launch. Neither did Brütal Legend. Broken age turned into a mess, along with space base. Sorry but Tim Shaffer seems like a kind of risky guy to invest money in.

Oh, I thought you were just taking a crack at their supposedly terrible Kickstarter track record. My mistake.

Although, Double Fine have actually released a shit-ton of games (many of them well-received) with little or no drama over their 16 years in operation. Plenty of bigger-profile studios have closed in less time, so I guess they're doing something right.

 

[Frozenprince]

It only renders the ability to turn a profit to nil for the investors. For the developers themselves, the break even is much lower.

The service itself won't survive without the investors constantly keeping projects going through it. So if it gets it wrong, the platform will die.

 

[CertifiedFP]

Oh, I thought you were just taking a crack at their supposedly terrible Kickstarter track record. My mistake.

Although, Double Fine have actually released a shit-ton of games (many of them well-received) with little or no drama over their 16 years in operation. Plenty of bigger-profile studios have closed in less time, so I guess they're doing something right.

Arguably their ability to stay afloat is because they're not "bigger-profile".

Look at Running With Scissors, who stayed afloat with two games (Postal 1 and 2) and an expansion for a decade doing literally nothing until they released another expansion before vanishing off into the ether again to coast on sales of that expansion. Though I'll admit, as far as I can recall, game development is a hobby for them in the present and their real business is in the adult film industry under another name.

Most of the studio failures I can think of of the past decade involved 100+ man studios doing $25+ million follow-the-leader projects that tanked due to being mediocre clones of the Flavor of the Week that had a bigger marketing budget than game design budget. Double Fine has largely stayed out of that trap thanks to being independent.

The problem is that at the end of the day they've got a history of fleecing investors with poorly budgeted money sinks - And since they're independent and small, they're able to find a new sugar daddy once the previous one cuts them off instead of being Pandemic Studios'd.

I mean seriously? The target for breaking even for a sequel to a sub-million selling game is 2 Million? Please.

 

[Wozman23]

In Fig's/Double Fine's defense, the original estimates that assumed the game could sell 1.7 million units at an average sale of $21 seemed like an extremely liberal calculation.

As the OP stated, the vast majority of the copies were sold far below $21 via digital PC platforms, at single digit, almost negligible dollar values.

When I was deciding if I wanted to invest, I tried to calculate a more realistic average based on retail discs selling at $30, Digital sales at $5 to $10, and the Humble Bundle sales at $1, which gave me an average closer to $10.

With those numbers, investing seemed too risky, and more in line with the new projections.

Plus, those numbers don't even account for the large amount of initial sales lost due to crowdfunders receiving the game. Theoretically that eliminates a sizeable chunk of original's physical release sales.

Plus, platformers don't exactly sell well in today's market.

Plus, that Frankenstein combo of physical sales, digital sales, and bundled sales, isn't guaranteed to happen with the sequel.

So I didn't invest, and I didn't even back it. Granted, I'm looking forward to picking it up when it launches.

Also, if you didn't play Headlander, it was great! One of Double Fine's best since Psychonauts.

 

[hollomat]

In Fig's/Double Fine's defense, the original estimates that assumed the game could sell 1.7 million units at an average sale of $21 seemed like an extremely liberal calculation.

As the OP stated, the vast majority of the copies were sold far below $21 via digital PC platforms, at single digit, almost negligible dollar values.

When I was deciding if I wanted to invest, I tried to calculate a more realistic average based on retail discs selling at $30, Digital sales at $5 to $10, and the Humble Bundle sales at $1, which gave me an average closer to $10.

With those numbers, investing seemed too risky.

Plus, those numbers don't even account for the large amount of initial sales lost due to crowdfunders receiving the game. Theoretically that eliminates a sizeable chunk of original's physical release sales.

Plus, platformers don't exactly sell well in today's market.

Plus, that Frankenstein combo of physical sales, digital sales, and bundled sales, isn't guaranteed to happen with the sequel.

So I didn't invest, and I didn't even back it. Granted, I'm looking forward to picking it up when it launches.

Also, if you didn't play Headlander, it was great! One of Double Fine's best since Psychonauts.

This is what's crazy. Selling 1.7M copies at $21 seems very unlikely. Now they have to sell 2.2M at $60 for investors to break even. Even selling enough copies to leave investors with a 50% loss seems unlikely.

 

[CassidyIzABeast]

Taking one for the team.

 

[njustus]

The terms are completely different, and based on the terms of the offering agreement

Hello there, CEO of Fig here.

What you are referring to is the minimum amount, it can be higher.

Like to point out this sentence also in our offering circular:

'Fig’s Board of Directors may in its discretion from time to time pay more than 30% of Fig’s revenue share from Psychonauts 2 to Fig Game Shares – PSY2 holders, if in its view business conditions permit it.'

An offering statement relating to Fig Publishing, Inc.’s Fig Game Shares - PSY2 has been filed with the U.S. Securities and Exchange Commission and has been qualified. Prior to any investment in Fig Game Shares - PSY2, you should review a copy of the offering circular included in such offering statement by clicking on the following link: Fig Game Shares - PSY2 offering circular, or by requesting a copy by phone at 415-689-5789 or by writing to Fig at 599 Third St., Suite 211, San Francisco, CA 94107. No offer to sell any securities, and no solicitation of an offer to buy any securities, is being made in any jurisdiction in which such offer, sale or solicitation would not be permitted by applicable law.

 

[Slayven]

Who ran the numbers on this investment?

 

[NoKisum]

Psychonauts 3 officially cancelled then

 

[CrichtonKicks]

The game has been funded for almost a year now and has been in development since then. If you want you can further invest into the game, help it along and hope for a profit - as you can do with every other game if you have the connections. Fig simply builds a bridge.

You keep saying this but this is wrong. Because of SEC complications FIG could never get the money from unaccredited investors in the original campaign. These mailings are going out now, almost a year later, because the SEC stuff finally cleared up. No unaccredited investor has ever put money into Psychonauts 2. If people change their mind now then it will leave Psychonauts with significantly lower funding than was anticipated when the campaign closed.

In short, this isn't a new round of funding. This is trying to collect on the promised amounts from before.

 

[IdreamofHIME]

If you put money in this to make a profit, you're an idiot. Sorry.
This campaign was pretty much a charity drive so people who craved this game could fund it pretty much for themselves.

 

[Striek]

Hello there, CEO of Fig here.

What you are referring to is the minimum amount, it can be higher.

That doesn't seem like a smart way to invest to be fair, hoping on terms that could be more favourable than you agree to.

But if you have the time, can you answer just one question - why does the payout for "game share" investors rely so heavily on the amount Fig invests?

I mean, based on the minimum payout, and the minimum amount from Fig invested, the game would have to produce revenue of $750,000,000 for investors to be paid back....

Fig AGR until $13,333,333 = $0.57 per copy to investors = $181,000 repaid to investors from the first 317,000 copies sold. After that it takes another 12,250,000 copies at $0.23 per copy.

And that assumes all copies are sold at full price! At that point you must assume Psychonauts will be one of the best selling titles of all time.

 

[Man God]

Except it actually is a platformer, for those of us that have played it.

A really, really bad platformer at that.

The people who do like it certainly don't defend the gameplay, which is awful. It's all about the writing.

 

[hamchan]

Fig is so incredibly shady. I would actively encourage everyone to not invest anything because these terms seem bad and unclear. You'd have to be dumb to actually give them a large chunk of money through Fig.