Crowdfunding games is a growing slice of the crowdsourcing market. Many developers are creating video games and the products that do well can be highly lucrative. With video games, however, word of mouth can be very important as can allowing the gamer to try things out – so of course crowdfunding for video games has emerged. There is also crowdfunding for games that involves only “regular” traditionalgames such as various card ad board games. We cover all of this in this post.
Types of Crowdfunding Games
There are two main types of crowdfunding for games, rewards-based and equity-based. We go over both:
Crowdfunding for Games Rewards
Of course the main reason that developers enter the crowdfunding for games market is that they want exposure and PR around their idea. But in most cases these video game crowdfunding pitches are not an equity type of crowdsourcing – there is no offer to get a share of the revenue or profit. Instead the pitch is that you can get certain perks with your investment, such as:
Crowdfunding for Video Games for Early Releases
- Beta testing new versions of the game or new rules: In this case you get to be one of the first to try the latest version or to give feedback about a modification or change. You truly feel like you have had some influence in the development of the game, and you get to enjoy the improvement first. This may be the most sought perk of video game crowdfunding.
- Getting free copies: Of course a perk that is very related to the first one is that you can get an early copy of the game itself. You can not only be helping with its design, but also one of the first to own it. And given that you are an investor of sorts you will want to spread the word and let other try the game so they might invest too.
Crowdfunding for Games to Be Part of the Team
- Often people in the game development space are quite creating and fun. You may feel great about connecting to these people who are making these games and a part of the entire production process
- Meeting the team in person, or getting together with others with similar interests can be a rewards offered to those who invest.
Other tangible perks and rewards can be given that have value to the investor and are in the gaming sphere such as meet-and-greets with well-known developers or gamers, or reciprocal help – when a gamer invests in the project of another group and receives free advice about their own project. In many cases crowdfunding games involves just perks, with no equity or other financial payback, yet there are some ways that you can benefit beyond just the ways listed above, and that is what we go over in our next section.
Crowdfunding Games for Equity
It is possible that a company that is in the crowdfunding games market could make itself available in an equity deal. In other words, a certain amount of the company would be available to the crowd as part of an equity transaction. This could happen in two ways: The company could put its entire book of business up for equity investors, or the company could put the potential equity of one game up for “sale”. Each of these options come with some obvious pluses and minuses for both sides. Investors may be quite interested in the entire company, but this will require a much larger investment and comes with the pitfalls that only one or two or just a small number of the games actually make it big. Choosing to invest in just one game might have led to almost the same payout for a much smaller amount of money. For the company, selling off a percentage of its entire inventory means giving up a substantial amount of the future earnings across all products, but it also of course leads to the largest investments.
One way or another video game crowdfunding that involves equity stakes are a great way for both sides to meet their financial needs, and just like any other equity investment the risk and reward is shared and the degree of potential risks and rewards becomes the basis for the negotiations between the two parties.
Crowdfunding Games Sites
Here are just three examples of crowdfunding games websites. Each one is a little different and unique, so if you are just starting out as an investor or someone looking for perks you may want to look at all three of these and perhaps others before coming to a final decision:
- Gambitious is an example of a rewards-based crowdfunding games platform, but there are also equity opportunities as well. On the equity side this site is what is called “all-or-nothing” meaning that you may lose all of your investment if the game is not successful, but the benefits if it is will be great. Examples of “rewards” may include being able to beta test new games or receiving certain behind the scenes information and releases before others.
- Pozible is a site that uses rewards based crowdfunding games only. The site uses a tiered approach – not all investors get the same rewards and instead your rewards may depend on how much you invest in each project. Pozible also is a nice site if you want to look beyond games but want to stay in the category of creative projects.
- Kickstarter for games must be mentioned on any list of crowdfunding games sites. Of course this is one of the best known crowdfunding websites in general, and they have a robust games category where designers can offer rewards based on the level of funding offered. Kickstarter for games has helped launch close to 4,000 crowdfunding games projects and there is a reasonable success rate of close to one-third.
How to Choose a Crowdfunding Games Website
Once again, these are just three examples and it is worth checking out as many as you need to arrive at the best fit for your project or investment. Look for sites that have attracted a good amount of funding, that has a strong success rate, and where the customer service seems solid. Aside from that you want to look for a site that seems to match your idea or your interests.
Whether you are going to invest in a crowdfunding for video games pitch for the perks, or to become a part owner, and whether you are a company deciding which type of path to choose, there is a lot of fun, excitement, and potential in the crowdfunding games space!