Alert reader Gaurav shared with me a post-fulfillment project update from Evil Hat Productions that offered the level of transparency I love seeing from creators. I’m going to post the full breakdown below (an exact quote from the public update), then I’ll share a few thoughts after the break.
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Revenue:
- Kickstarter, after payment processor & KS cut: Just under $270k ($269,822.06 to be exact)
- Backerkit, where we did our preorders and add-ons and so forth: ~$31k
Total starting revenue: ~$301k ($301,388.06)
Expenses:
- Marketing & Miscellany (mostly marketing): ~$27k
- Thirsty Sword Lesbians book development (text & art): ~$30k (art was over $21k of that; April’s writing gets compensated through royalties; remaining text costs were for editing, system development, contributor settings authors, sensitivity reading, indexing, etc)
- Advanced Lovers & Lesbians stretch goals development (text & art): ~$61k (art budget is ~$27k of that, ~$34k for the authors & editors)
- Manufacture of the physical books: 10,500 units cost ~$39k to print
- Download codes for the Roll20 module: ~$11k
- Freight: ~$4k to get things from the printer to our US and UK points of distribution
- Shipping: $40k to get books to backers
- Project management, social media, customer service, graphic design, Roll20 character sheet and module development: $0, we do all those things in-house at Evil Hat and get our salaries covered by things like our cut of the profits.
Total expenses: just shy of ~$213k (some rounding in the above numbers) — a little over 70% of our starting revenue.
Remaining profit: A little over $88k to be divided between Evil Hat Production and Gay Spaceship Games!
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Jamey here! If you’re working on a tabletop RPG for Kickstarter (or just a tabletop game), are these proportional costs along the lines of what you can expect to pay? A few thoughts about that using the data for Thirsty Sword Lesbians:
- “Marketing” is a big category–by definition, it encompasses every aspect of the product design and rollout–but I’m assuming here that it’s referring to advertising and outreach. If that’s the case, I think $27k is on the high end. You can promote a campaign using your enewsletter, some Facebook ads, a few paid previews, and maybe a banner on BoardGameGeek for less than $5k (and you can go even more shoestring than that if you’d like). But perhaps I’m missing something big–and effective–that Fred can share.
- $48k for art (and, I’m assuming, graphic design) is a lot. I admire Evil Hat for going so deep on art, but I think it’s fairly rare for a project to spend that much on art. That’s even on the upper end for our games, which typically have at least 50 unique illustrations, often even in the 75-100 range. Graphic design is also a significant expense.
- The one big expense that I can’t seem to find here is the author/designer royalties. Fred notes that “April’s writing gets compensated through royalties,” but those royalties should include the campaign itself. At Stonemaier, for example, a normal royalty is 7-8%, and that includes Kickstarter revenue. So in this case, April would have received around $21k in royalties from the Kickstarter.
- $4k total for freight shipping to two different destinations is great these days. I’m guessing those were 20′ containers, so in the current market, you can expect to pay closer to $6-8k for a single 20′ shipping container.
- It’s notable to mention that of the 10,500 units of Thirsty Sword Lesbians printed for $39k, only around half of those units–5300–went to backers (this is noted later on the update). So that leaves 5,200 units for Evil Hat to sell post-Kickstarter. They’ve already paid for those units, so essentially all revenue earned from those sales is pure profit, which changes their earnings ratio from 30% to more like 50%, which is great.
Overall, I think these types of breakdowns are really nice to share with backers and helpful for other creators to see–thank you to Fred for sharing this update publicly! Do you have any thoughts, questions, or observations from this data?
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20 Comments on “Exactly How Much Does a Kickstarter Campaign Cost?”
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I just want to know where you get 10500 books printed for $39K. Even at high discounts, the paper alone should be more than $3.71. Is this a 10 page softcover?
The manufacturer I work with, Panda, has a printing press for books. If you’re looking to print a book, I’d recommend talking with them (I can’t speak to their exact prices, but I’ve printed an art book and rulebook with them that had a very reasonable cost and I’ve printed many rulebooks with them that are far, far less expensive than $3.71).
Hi, I am collaborating with a development studio for the launch of our first Kickstarter campaign and I found the Stonemaiergames Blog, a very precious source of information, so first of all I would like to thank you. My question is this: how much does marketing influence the actual success of a Kickstarter? and above all, what is the magic behind the transformation of a Followers of the project to a Backers? I know the question might seem silly and I guess it depends a lot on the project, but with how many real followers can you start to feel calm about the success of the campaign?
Thanks Carlo, and welcome! I don’t think there’s an exact science to this, and I have many articles about pre-marketing and marketing that will delve into how to convert followers to backers and why this is all important. But overall, yes, it’s crucial to have followers before you launch, and I’d aim for 4x the number you need to actually fund the project. So if your real funding goal is $15,000 and you determine you need 300 backers to make that happen, you would look to have around 1200 project followers before you launch.
Thank you very much Jamey I’m going to read the articles you talked about right away. If I have any doubts, see you there: D
The thing is, the Kickstarter goal for Thirsty Sword Lesbians was $19,999. Now, I know that attempting to recover sunk goals with a Kickstarter is a fools errand, but it seems that if this campaign had simply and successfully made its goal it would have been in huge trouble. Can I ask what the logic behind the almost $20k was exactly and what the plan was if the campaign had made around 100%?
I always think that the purpose of a campaign’s goal and length is that it should aim to reach around 100% at around the end of the campaign, with more more quickly being a bonus. It seems though that more and more often campaigns are actually aiming at some hidden true goal that has little to do with the stated one.
I’ve never run a Kickstarter project, so take my views with at least a pinch of salt, but it’s fairly obvious that there are costs associated with failing to reach your goal on Kickstarter, and less obvious that there are others associated with looking like you might fail to.
While there’s certainly an argument that you shouldn’t set your target below what you need in order to break even on the project, by the time you bring something to Kickstarter, there’s already a lot of sunk cost involved, which means you only really need to cover the production and distribution costs through the Kickstarter to be better off for having run it – and as Jamey points out, you’ll pick up additional revenue later from selling the rest of the production run, so even making a modest upfront loss on the Kickstarter can be offset by the increased revenue coming from word of mouth once people get your product in their hands. So, overall, the hard floor on your goal probably ends up a lot lower than you’d think just looking at this sort of breakdown.
My feeling is that, provided you can afford it, you want to target hitting your funding goal in the first day or two of the campaign. That way anyone backing after that knows that they’re actually spending the money and should get their pledge reward eventually, rather than not knowing whether the campaign will fail due to lack of funding. If you’re only reaching your 100% threshold on the last day, you’re going to miss out on people who prefer to put their money toward a more certain success.
And, of course, if you set a target above your hard floor, and then just miss out, that puts you in a bad position – do you write off your sunk costs, or do you launch a new campaign and hope the enthusiasm carries over, or do you back your own project enough to make up the difference, effectively paying Kickstarter a percentage of the shortfall to make your project fund.
So, yeah, setting a relatively low goal, provided it’s above your hard floor, makes a lot of sense, even if you’re hoping for/expecting to get a lot more.
Firstly, I often hear it said that there are lots and lots of backers who only want to back a full funded project. On a platform that’s about being part of making something that wasn’t going to happen happen and funding the creation of something new I’m not certain that’s the undeniable draw that is often suggested. Personally, if something has funded in the first 48 hours its a pretty safe bet its going to hit retail and I can pick it up from my FLGS without paying postage so the idea that its a huge encouragement to pile on the bandwagon rather than putting my money towards something where I might tip it over into existing isn’t totally encouraging.
Secondly, I said that chasing sunk cost is a fool’s errand, but here fulfillment cost $79k and the campaign itself apparently cost $27k, meaning that if they’d hit their actual goal exactly they’d be $86k in the hole. That’s not a modest upfront loss, that’s a pretty huge price for hitting launch. In addition, having said that about sunk costs, I’m going to go out on a limb and say that if you have sunk costs of over $30k, another $27k on the campaign itself and your campaign ends up taking $300k you might have had a sneaking suspicion you were going to take something close to that. I know campaigns go better than were expected, but when a reasonably established company partnership invest that much money they have a pretty clear idea that its going to come back, I’d think, so again, stating a goal that doesn’t cover fulfillment and isn’t what is expected to me made seems a little disingenuous during a process that’s meant to be about building a relationship with backers.
Thirdly, the idea that a project having fully funded means 100% certainty of getting your reward is, sadly, false. Projects often fail to fulfill due to not being able to afford to complete due, sometimes, to stating goals that aren’t sufficient to fulfill. BGG’s controversial Kickstarter list is packed with projects that are in exactly that position. While spotting red flags like insufficient goals is part of being a defensive Kickstarter backer it shouldn’t be necessary if creators set honest and responsible goals.
Lastly, again, the idea that a campaign which picked up $298,568 needed to set a goal of $19,999 of they’d have risked narrowly not funding is a bit crazy, but yes, in that case you’d learn a lesson and re-launch. Re-launching is far from a curse, essentially meaning that a project gets two shots at the mighty Kickstarter day one it usually results in a project that gets much higher funding than it originally would have, Jamey has written a blog on exactly that point. It might be tough to “lose” the sunk advertising costs, though having raised your profile with advertising is the point of that, and that’s happened either way, but that doesn’t stop it being the right thing to do sometimes. Its great that this project ended up doing well enough to cover this decision and turn out as a good choice, which is why we’re now seeing this break down, but there are tons of projects where it stays a bad choice. Irresponsible choices is leading to people starting to view Kickstarter as a games production wild west in some cases and driving backers away from the platform. The idea that perceived momentum with its unproven benefits is worth that seems hard to grasp.
I’m planning to launch a KS late in 2022, and have been working on budgeting to see if its a pursuit that I can afford. I haven’t actually done a campaign yet, but maybe my perspective can inform how some people choose to think about it.
I plan to have all of the art done around 15k and to sink a minimum of 10k into marketing, with more being put if the campaign is doing well and I am getting a good return on the marketing dollars.
That said, I think my break-even point will be around $65k in revenue. I plan to set my goal around $28k. With 28k I will take a full $30k loss, which is more then my sunk costs largely because I need to hit minimum order size of 1500 units with manufacturer. If my print run is that small, I may have a hard time in retail since the game wouldn’t really have made a splash. So I wouldn’t count on that to make up the diff,
My reasoning is mostly that if I can’t make up the sunk costs, the money is already spent so I may as well finish. However, there is also value in finishing the campaign for its own sake. In my case, I get to see the project through. If the game is liked, I can maybe return with a reprint with fewer fixed costs. I build my reputation a bit. It’s a bad investment, but I think it’s worth about $5-10k to make sure that $25k invested in art etc. doesn’t end up doing nothing and just sitting in the garage.
That said, I can’t really speak to a more experienced publisher and their motives. It does seem like a big loss they would have had, but I think its more then you expect. The art would still have been 21k, but the writing would be less because of the royalties, and there would be no stretch goals hit.
1) “Marketing” here by and large involved working with BackerKit’s marketing arm to do a ton of ad placements, where the fee we paid them was the cost of the advertising spend + a percentage of pledges that analytics confirmed could be credited to their campaign. The difference they made in terms of pledge traffic was super palpable, and they took care to keep it scaling up in an acceptable proportion to the amount of revenue it was bringing in.
2) $48k on art is split across over 400 book-pages of associated content, and the budget there was boosted (over double) by some of the stretch goals we did during the campaign specifically about amplifying artist pay.
3) Our royalties deal with April amounted to her getting considerably more than $21k; we operate on a “together we cover the expenses, then we split the profits remaining” footing. Because it’s a cover-expenses-first deal, the royalties percentage we offer on the net profits is much much higher than 7-8%.
4) No shipping containers involved due to our operation being 90% domestic. We printed around 10k books with Taylor Specialty Books here in the USA. Freight was transit to Alliance Games Distribution in the US, and then a smaller freight shipment (about 1k units) across the Atlantic to our international fulfillment partner in the UK.
5) Yup, we try to size our print runs from Kickstarters such that they produce as many sellable copies as they produce sold copies, on the very approximate notion that you maybe manage to reach half your audience via the campaign itself. Sales have been pretty nice since; wouldn’t be surprised to see us at over 2000 units sold outside of the KS, after we released the book to the general public this past June (2021).
Thanks so much for chiming in with these clarifications, Fred! This was an awesome project update. I see about the royalties on profit (I personally prefer royalties on revenue, as the designer isn’t responsible for how much a publisher does or doesn’t spend, but I respect that decision if April is happy with it!).
We tend to prefer royalties on profit due to it investing all members of the partnership in achieving said profit — and also for cashflow/sustainability (covering a product’s expenses first = more stable, more likely to be able to do more for us). The (much) bigger royalties percentage is a counterbalance to that, and as noted, also meant April still walked away from the KS with more than she would’ve gotten at a 7-8% revenue royalty.
Hell All! Just a reader here, not a game designer or anything but I am an accountant, and I just wanted to pop in and say THANK YOU SO MUCH for sharing this kind of info. For whatever reason profits and finances of a project end up such a closely guarded secret that many people get into these as a first time creator with almost no knowledge of what to expect. I love seeing this kind of financial transparency and discussion, and I hope it’s something you’ll all continue to share for the good of every new creator out there!
I just want to say that I was one of the Thirsty Sword Lesbians KS backers, and that book is incredible. The print quality is fantastic; the art is everything I wanted; the overall content and campaign materials are just top-notch.
I am thrilled that you covered expenses so you can truly divide the profits among the creators, and I appreciated as a backer having the option to pledge more or support stretch goals which led to artists being paid a truly fair wage. All ’round, a great campaign, one that I was very proud to support. I bought two books, already gave one to a friend.
“$4k total for freight shipping to two different destinations is great these days. I’m guessing those were 20′ containers, so in the current market, you can expect to pay closer to $6-8k for a single 20′ shipping container.”
This was a book, so I believe the printed it in the US. It was likely a full truck load from the manufacturer to the US fulfillment center and then a small (LCL) shipment from the US fulfillment center to the UK fulfillment center.
I’d say it mostly goes to show that if your product can be manufactured in the same continent as the majority of your customers are, there’s a lot to be saved in shipping costs. Of course, in the case of games, the factories to manufacture high quality punchboard and detailed plastic minitures just don’t exist in North America.
Ah, that makes sense, particularly if it was printed in the US. Good call.
Yup, Alex is exactly right.
Oh wow, this is so very helpful, Jamey. As I see our own KS campaign coming to a close later this week, I’m feeling overwhelmed by the amount that needs to get done, and know that there are a lot of hidden costs that I haven’t even planned for yet. Many of my friends and family see the total amount we’ve raised on Kickstarter and instantly imagine me swimming in a pool of money like Scrooge McDuck. Little do they know that much of that pool will be emptied by the time I dive off that diving board. Let’s just hope I don’t break my neck on an empty pool floor ;)
I’m so glad to see Distilled going strong as you enter your final few days! (https://www.kickstarter.com/projects/paversongames/distilled)
Thanks Jamey – much appreciated. I have your blogs, experience, and wisdom to thank for much of that success! I also still remember the great feedback you provided to me, from Virtual Stonemaier Design Day – many thanks! 🙏