If I Returned to Kickstarter, Here’s How I’d Do It

18 October 2018 | 59 Comments

Let’s pretend for a day that I decided to launch a new project on Kickstarter for the first time in 3+ years. Here’s how I’d do it.

(For context of why I’m even writing about this hypothetical situation, please read Tuesday’s article.)

I’ll start with the core project specs, then I’ll delve into how I would address the reasons I stopped using Kickstarter as a creator in the first place. Other creators are welcome to emulate what I describe below, but please keep in mind that these decisions are based specifically on what I think would work best for Stonemaier Games.

Core Project Specs

  • Preview: I would start talking about the game informally 1-2 months in advance. For the week preceding the launch, as discussed here, I would have 1-2 ads (BGG/Facebook) and 1 preview. I would consider doing something like what Tang Garden did (for each e-mail collected before the campaign, they planted a tree).
  • Type of Game: The type of game that would make me reconsider Kickstarter would be an expensive game, one that would retail at $80-$100, if not more. Kickstarter would allow me to discount the game (but still have strong margins) to create a strong, wide user base in the hopes of enabling a long tail for the game, like what happened with Scythe.
  • Base Game: The base game would be 100% complete and ready for production, perhaps with the non-printed components already in production. While the Kickstarter project would be funding the manufacturing for the base game, it would not be part of the additive process during the campaign. We would emphasize through the “what’s in the box” image that the base game is fully robust and complete, offering a great value on its own. This impacts several other decisions further on this list, including the next one.
  • Reviewers: I would have our manufacturer make multiple pre-production copies of the game to use as review copies. This enables potential backers to see exactly what the final game will look like.
  • Project Page: I would stick pretty closely to the tried-and-true method for project page content, though I would try to keep it as succinct and visual as possible. Given how long we’ve been off of Kickstarter, I would not assume backers know who Stonemaier Games is.
  • Video: I would contract Josh McDowell to create the project video in the vein of the trailers he’s created for our other recent games, like this one. They’re all about 60 seconds long.
  • Funding Goal: I would base the funding goal on printing a minimum print run of the base game. So, around $20-$25k.
  • 24-Hour Goal: I’m on the fence about this. I love global improvements that inspire people to back on Day 1, though I also know there are other ways to excite and engage backers from the beginning of a campaign.
  • Stretch Goals: As I mentioned above, the base game would be set in stone, so the creative ownership backers would have for the project would stem from the stretch goals. I’d use the Root method: All stretch goals are included for free in all core reward levels, and they would be compiled to form an expansion for the game. There would be no exclusives, just early and free access to the expansion content. I think I would reveal stretch goals as they’re met, knowing that we might race through them and simply run out of them (which I’m totally fine with–I’d rather do that than negatively impact the schedule and budget). I would, however, be very hesitant to put a game on Kickstarter if I didn’t have stretch goals–if I’m not stretching, I’d rather just make the game up front.
  • Rewards: I’m on the fence about having a $1 reward. While I still love the core reasons for it, I wouldn’t want to convey to backers that there will be a pledge manager after the campaign. After that, I would have two reward levels (we’ll assume this is an $80 MSRP game + potentially $25 in stretch goals for these numbers): A $69 unlimited reward and a $75 first-printing reward limited to 10,000 individually numbered games (those would be the games that are already in production, so they would be shipped several months earlier than the $69 second batch). One risk about this strategy is that I’m sure I’d hear from batch 2 backers when batch 1 backers start to receive their rewards, asking me why their game hasn’t been shipped yet.
  • Shipping Costs: I lean strongly towards including the core shipping cost (US/CA/UK) in the price of the rewards so create “free” shipping, with the difference added automatically for backers in other regions. I want to avoid the sticker shock of clicking on a $69 reward that a backer has managed to justify to their wallet, only to be presented with an $82 actual price. The only tricky part of this is that our Stonemaier Champion program offers free US shipping (discounted international). So I would need to find a way to refund Champions later.
  • Retailers: I would let retailers pledge for 1-2 cases from the second batch (the $69 reward, but at a retailer discount). Beyond that, the game would enter wide distribution in the third printing (or maybe an extension of the third-printing? I want to make sure non-backers can get the game at the same time that backers are the most excited about it. At the same time, I want to avoid the situation where backers see the game at their local retailer before they’ve even gotten their copy).
  • Duration and Timeframe: I would launch on a Monday afternoon (there’s a glut of Tuesday launches). The project would be between 10 and 14 days long. That’s plenty of time for our current audience to back the project and for new folks to discover it. Because we’ll have already started production on the first 10,000 units, we would target a first-printing delivery date 4 months later, followed by the second second 2-3 months later.
  • Pledge Manager: The project as planned is streamlined enough to not warrant the need for a pledge manager (I’d use Kickstarter’s built-in survey). Nor would I want to encourage potential backers to wait until after the campaign to pledge. Instead, if someone discovers the project post-campaign, they’ll be redirected to our website, where they can pre-order the game (and, optionally, the expansion that we built during the campaign with stretch goals) at a smaller discount.
  • Project Updates: I would post every 2 days during the campaign and once every 1-2 weeks post-campaign.
  • Kickstarter Live: This wasn’t an option back when I was on Kickstarter, but it looks awesome. I’d want to host these every other day (on the non-update days).
  • Fulfillment: I would use OTX to freight ship to several fulfillment centers worldwide: VFI (Asia), Starlit Citadel (Canada), Aetherworks (Australia/NZ), and Spiral Galaxy (Europe). The US games would go directly to the warehouse we share with Greater Than Games, and they would handle US fulfillment (unless they aren’t available at the time, at which point we would work with Fulfillrite, Quartermaster Logistics, or Funagain).
  • Money-Back Guarantee: I’ve had a money-back guarantee on all of my other projects, so I don’t see a reason not to include it here. I think the impact is probably minimal, so I wouldn’t make a big deal out of it, but it’s important to me that early adopters know that they can cancel at any time.

Overcoming Past Concerns

You can read in detail why I stopped using Kickstarter as a creator, but I’ll recap below and talk about how I would address these concerns:

  • Fulfillment Risk: I think it may be impossible to ensure that all fulfillment companies will do everything perfectly. I think the split-batch system I’m proposing would help mitigate the risk a little bit, though. If a fulfillment center really messes up the first batch, we’ll simply use someone else for the second batch.
  • Time/Emotional Toll: As you can tell from the timelines described above, I’m trying to condense everything as much as possible. I think that’ll help quite a bit. I also might hire someone during and after the campaign to represent Stonemaier in the comments and private KS messages. I’d still run the campaign and be active in the discussion, but I’ve seen how much it helps to have other people moderating our Facebook groups, and I think the same would apply here.
  • Human Nature: I experienced an unfortunate side of human nature during the Scythe fulfillment process that surprised and disheartened me. I don’t know how to fix humans, so this is another area where I would probably need the boost of a helper.
  • Retailer/Distributor Relationships: This is tricky, because I’ve spent the last 3 years investing heavily in our relationships with retailers and distributors. Our long-term success hinges on them. I think I would have a frank conversation with them prior to launch in which I would emphasize the impact that Scythe’s Kickstarter had on forming a really solid foundation for the game, propelling it and its expansions/accessories to monumental profits for retailers and distributors, far exceeding the original campaign. I know that Scythe is an anomaly, but the game I would choose for a Kickstarter campaign would have similar potential. [Update: I polled the retailers on our list, and the results are split between retailers who would actually like us to return to Kickstarter and those who wouldn’t like it.]

***

I think that’s it! That’s how I’d run a project if I ever returned to Kickstarter. I’m certainly open to feedback, though. What do you think about these methods? What areas are you curious about that I didn’t mention?


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59 Comments on “If I Returned to Kickstarter, Here’s How I’d Do It

  1. I was just wondering about your thoughts on this after that Ludology episode and your last blog :D

    I’d be interested to read an article in a similar style if you had little to no followers and needed the money from KS to fund initial print runs.

    For example, let’s say I have a decent job that allows me to invest $1500 per month into a game project, causing me to go slowly into a very manageable debt over time on a 0% card or a Home Equity line. That describes a lot of first time creators looking to bring a good game to life.

    What would be the smart way to get this done, assuming you have the money you need for prototyping and sending review copies printed off TGC, but you have a limited budget for advertising and production. I would imagine this hypothetical is full of holes, but do you see enough merit in this to write about it? :D

      1. Wanted to write the same idea / question Andrew :D. Lost of us who follow you Jamey are in that boat Andrew described.

  2. I just bought Scythe and played it for the first time last week. Thank you for the wonderful. But I want to commend you for staying involved with the fans. It has to be tough to keep on “it” some days, but you do a fantastic job.

  3. Hi Jamey,
    That’s an incredibly useful article I will have to read this a few times. Thanks for writing it.
    But you made a mistake on the shipping. It should be:
    “(US/CA/UK/IE) in the price of the rewards so create “free” shipping” :)

  4. What a great write up! It was very informative but made me want to throw up at the same time.

    As a first time creator it would seem some things might not apply. For example, starting the production of the game prior to even launching/funding. You’re past successes and reputation give you more leeway to do that. Where as a first timer probably doesn’t have the capital to do the production ahead of time nor the following to be ordering 10k ahead of time.

    For clarity on the minimum print run, you would set the goal based on 1500 copies versus the full 10k that you are already producing?

    I’m curious about the margins. Assuming it is $80 MSRP that would be about $16 to produce. However only charging $69. Plus freight, shipping and fulfillment. What is your target per profit per unit in this example?

    Again, super informative and much appreciated. I just have a lot to do before my first launch next year.

    1. I agree, a first-time creator would probably want to take a different approach for several of these aspects. I think they would probably want to use a more traditional premium option instead of using the system i’ve proposed here.

      For a game that costs $18 to make (like Scythe), we typically stretch that down to an $80 MSRP. Freight and fulfillment would vary based on weight/size, but let’s say $15. So That’s a total cost of $33 (we’ll round up to $35 to have a buffer)–that still offers a profit margin of $34, which is excellent. If we sold that same game to a distributor, they would pay $32, so the profit margin (assuming $3 in freight shipping/trucking) would be $11.

  5. Jamie, your honest and well-thought out commentary on the industry (and specifically, your company, obviously) is always refreshing.

    Personally, the part that really jumped out at me in your plan is the idea that the final product would be shipped out in 4-7 months after the close of the campaign. A trend I’ve seen recently — including at least two high profile(?) releases this week — is to have the product date in late 2019 or even 2020… add on the typical KS delays and you’re paying at least $150+ for a product you won’t see for more than a year. Needless to say, I’ve decided not to back either of these campaigns that had previously interested me.

    Aeon’s End (IB&C) has been doing the same thing as Root for awhile now; compiling the stretch goal content into a ready-for-retail expansion, which is a model I likewise thought was an excellent balance between the KS model and retail distribution. It also allows access to rules, near-finalized art, and such to be available during the campaign (another trend I’ve seen less-and-less of recently). To me, it tells me that I’m getting a finished product, that has been well tested and balanced, in the core box; one that won’t be impacted by the input from the KS campaign (which can lead to delays in production, shipping through feature creep). However, the valuable input of the KS contributors can still make an impact on the expansion content, which can be somewhat separated from the functions and play-ability of the core box.

    Otherwise, just quickly: the lack of a pledge manager doesn’t bother me at all; I’m a fan of a simple, straight-forward campaign. The idea of “free/included” shipping as a Canadian is *so* appealing; the exchange rate is often sticker-shock enough for me.

    Looking forward to what others have to say!

    1. Eric: I’ve noticed that trend too. I suspect that creators are (a) padding campaigns so they can deliver early (which is perfectly fine) or (b) creators aren’t finishing the game before launching (which is fine for new creators, but doesn’t make as much sense for repeat creators). I would try to reduce that timeframe as much as possible, and the method I proposed here would enable us to do it. The only tricky part is the expansion content–I would need to either print some of it in advance (knowing that if we didn’t reach the stretch goals, I would release the content as promos later) or ship the expansion separately with batch 2.

  6. I truly appreciate this insight! I’ve been studying your blogs and reading your book over the last 13 months …and I’ve been wondering how you would handle KS these days. I will definitely be updating my notebook. Thanks again!

      1. You obviously have a considerable amount of knowledge and experience in this area. I’ve read through your blog multiple times, and James Mathe’s as well, but I’m sure we still made at least as many bad decisions as good ones when it came time to do our first campaign. There’s no substitute for experience, and you could possibly monetize yours for the betterment of the industry.

        It would function like a loose studio alliance with cost-savings coming from economies of scale happening in marketing, printing, and shipping. This “alliance” has the flexibility to take a one-time creator with a great game or returning high-performers.

        Assuming you want to continue designing and making games, I would spin up a new LLC and work with someone you trust to run it. That person would not have to take all comers, but instead pick projects that were likely viable and then serve as the lead project manager. The publisher would not be divorced from the work though and would be counseled on who to contact, when to do it, and how much it will cost.

        The nice thing is that for backers, they’d know the product is happening through a well-rehearsed sequence of events. They could back comfortably knowing the game play, component quality, turn-around time, and fulfillment would meet their expectations regardless of who the publisher is.

        The small publisher gets some hand-holding, recognition, likely increased sales, and security in the knowledge all the right moves are being made. We had outside marketing help, shipping and fulfillment help, etc. I don’t think we’re alone in going not going it alone. I would have gladly paid the company I just roughly outlined to help us.

        If successful, you could expand the operation by bringing on additional project managers. In time and with enough volume, you could expand further by setting up your own distribution and fulfillment network; eventually even creating a replacement for Kickstarter that is strictly board game focused.

        Why be the gas station when you can be the petroleum company?

        1. This is very ambitious! A company called Game Salute tried to do this a while ago. It didn’t work for them, but not necessarily because it’s a bad idea (perhaps they just weren’t good at executing it).

          You’re wise to notice that it’s not something I could budget any time or resources towards, but someone else could run it. For a short time I offered Kickstarter consulting, but I stopped doing that because it was taking me away from my core focus: running Stonemaier Games (it’s an 80-hour-week job, so the maximum amount of time and energy I’m willing to spend on other creators is writing these articles and engaging with creators here).

          I do appreciate you sharing your thoughts in detail, though! Thank you. :)

  7. How successful are your current fundraising methods because of the audience built on Kickstarter? Would you be as successful using this method first instead of Kickstarter?

    I have a friend who has multiple published American Revolutionary War games with GMT. They work through a P500 system – after 500 sign ups with a credit card, they are put in a production queue schedule, and then build/ship. However, as someone ordering the game – the time between sign up and receipt of the game could be well over a year if not closer to two. The profit margin cleared is probably much higher, with much less “overhype” talk, and less problems than you run on kickstarter.

    All my friends who see this game played are like “What is that, this is awesome?!?”. The game is just not known. I had thought to myself “Wow, what would happen on one round of kickstarter”. Would a better target audience be hit and a bigger fanbase built? Even if Kickstarter is not ideal, the fanbase built and the target audience hit would probably transfer to another fundraising method later. The fans would follow the game to whatever fundraising method is done in the future, right?

  8. I had a question about the video portion.
    Which Is more important to you when sharing a project video, reach or engagement?

    While of course there is always more reach than engagement and you of course want both, I was wondering which was more important to you personally? And if you have an engagement to reach ratio goal, such as 5% of those reached engaged with the post.

    Or do you perhaps have another metric you value much more than these, such as retention?

    1. Zack: For me, the project video is a pitch. It’s a pitch to draw someone into the project. So, I would probably say the main goal is conversion.

      The reason I like them so short is that if I’ve seen the playthrough stats on videos, and I know how many more people will watch a 60-second video compared to a 120-second video. If I’m going to spend time and money designing a video pitch, I want as many people as possible to see the whole thing.

      But, if my only options are reach or engagement, I’d say engagement. What about you?

      1. I personally don’t watch most of the videos, though I certainly agree that a shorter one is better. I have stopped watching some after seeing the length of them.
        The example you gave is great. It gives a short introduction to the mechanics, art, theme, … of the game. Enough to see whether I am further interested in it or not.
        In my opinion, an execellent example of a great video (even if it is longer than your 60 seconds at 2:38) is the one for the Fireball Island Kickstarter. I have actually gone back a few times to just watch it and have a laugh. I think that mood is not fitting for most games, though.

  9. Interesting article again. I wonder if you could expand a little more about shipping to the EU (which includes the UK… for the time being at least). I’ve noticed that recently more projects have become less EU friendly again. Some creators have stated that it is now impossible to ship to the EU without adding significant costs (usually around 50% of the base cost). They are often accused of being lazy or hostile to EU backers while protesting that there is nothing that they can do with VAT often cited as the major blocker. Would you have any advice for them and does your article about how to fulfil to the EU still hold (sorry, can’t find the link at the moment )?

    1. I would say my article about the EU still stands. I’ve talked to Spiral Galaxy about it recently, and as long as you’re only sending games for fulfillment (not for sale post-Kickstarter, it’s pretty much the same it’s always been).

      1. Very odd. In the more recent one that I cancelled my pledge for due to this issue, the publisher is adamant that everything has changed recently and they have to charge VAT for each order separately and only for the EU, including on the shipping cost, leading to around $30 additional cost compared to the US (this has led to some heated discussion on the comments section as you can probably imagine). I wouldn’t expect you to comment on another publisher, but it’s interesting that two companies/people can have such drastically different approaches or reactions to the same problem.

        1. Jon this is Dan from Spiral Galaxy Games. The publisher you refer to is right in that the law is changing, we ourselves had to do a lot of consultation to determine what the correct process was. During that period we changed our mind several times before we were confident our understanding was correct.

          Im unsure on which publisher you refer to but depending on a few factors they maybe correct in the VAT they are charging (for example if they are warehousing goods for later sale, as Jamey stated). Even for those who may be operating on flawed understanding, it’s almost unsurprising considering the number of people who post their opinions on how to deal with VAT online. These opinions are wildly circulated as fact despite the fact they maybe incorrect.

          The long and short of it that how and when VAT is applied is very complicated, so how you deal with it really depends on how much research you have done. To that end, I link you to my colleague David’s excellent post on the subject:

          https://www.facebook.com/groups/TabletopKickstarters/permalink/2029191320474839/

          1. Dan, that’s is very interesting and worrying. Your link goes to a closed facebook group. Any chance of “copy and pasting” the text here for people that don’t want to join the group in order to read it?

            I thought the law is that funds from KS is liable to sales tax/VAT. Meaning what ever tax laws apply to you in your state (U.S. or EU) also apply with KS.

            Example: if your company is from an EU state (countries are states now) you need to pay VAT for every backer based in the EU.
            If you are based in New York then you have to pay sales tax for every backer based in New York (and any other sales tax law that apply to New York).

            Is it still like that, or now U.S. companies must pay VAT for EU backers?

          2. Hi Dan,

            Thanks for taking the time to explain things. I am also unable to access the Facebook post, which may have the answers to some questions I have, so I’d also be grateful if you could find a way to share the text.

            I guess my main question though is, in your opinion, assuming everyone understands the law correctly and abides by it completely, are the days of Kickstarters from the US being able to deliver to the EU for the same or slightly more money than to US backers over? Let’s assume that the company makes roughly equal profit from each game shipped to either destination. It is my understanding that, with VAT, the cost of EU games should be no more than around 20% higher than US ones, all other things being equal. What I’ve seen in the past and what appears to be happening more now is games costing 50% extra. This additional cost seems high compared to the 20% that VAT should be adding. What am I missing?

          3. I got access to the group and read the post. It seems there is a law coming in for fulfillment companies in April 2019. I’m not sure if the is EU wide or just UK.

            Lots of good info but from my understanding of that info there is a bit of a contradiction, it appears.

            Point C (about bulk importing) says no sales tax (VAT) has to be paid (apart from a small import VAT fee), if the publisher has made all the sales already and will not make any more in the UK with this batch. Just fulfillment basically. It says this is EU friendly, the backer and the publisher don’t need to pay anything extra.

            But then it ends C with a contradiction: “So apart from small publishers making some KS games and never selling any more games, all publishers will need to become VAT registers by April 2019 and hence we as backers will all have to get used to paying more.”

            I don’t understand how backers will have to get used to paying more if Point C is true, which says backers don’t have to pay more.

            I don’t understand ALL publishers must now register in the UK for VAT. Why a company like Stonemaier Games need to register if they got 50,000 backers in the UK and shipped 100,000 copies to the UK. The extra 50,000 being sold after they arrive. As the extra 50,000 would be to a distributor or to FLGS that already paid weeks to a U.S. bank account. The retailers would paid VAT when they sell the games at a higher price. I don’t get why every medium to large publishers need to.

          4. Chaps I have copied Dave’s post below, hopefully this answers your questions but I’ll do my best to answer anything that is unclear:

            Dave Gilham, Spiral Galaxy Games:

            “As there is so much guess work around VAT on this and other forums, I thought I would add my understanding from the perspective of a backer and a fulfilment house (Spiral Galaxy Games). I do apologise for the length of this.

            VAT as many will be aware is not a simple subject. Recently we at Spiral Galaxy Games have had to look at this in great depth and even hire an expert to check our understanding, advising on upcoming changes coming in April 2019.
            VAT comes in many forms but let’s just look at the scenario of a US Kickstarter Publisher shipping to a UK backer, and HMRC’s interest in this transaction. HMRC stands for Her Majesty’s Revenue & Customs and is our version of the IRS for our American gamer friends.

            The following post refers to Sales VAT and Import VAT. it’s worth stressing that these are terms we use to differentiate two distinct instances where a publisher may be charged VAT, rather than 2 different taxes. There is only one type of VAT, though it is charged at different rates depending on the EU country, the type of product and the reason for import.

            When you back a kickstarter project HMRC’s view is simple; you are making a purchase from a US supplier and importing it into the UK. Forget any talk of backing a project and the game is some sort of gift, reward etc. HMRC will not support this view. At this point there are 2 scenarios that can occur:

            1) The game already exists in the UK – (more common with ongoing fulfillment than a brand new project) In this situation the publisher must immediately become VAT registered, no minimum threshold exists in this case for a non-EU company. The publisher must pay HMRC VAT at 20% (in the UK) of the total pledge amount plus shipping. So, they need to make sure they are charging the backer this else they will be seriously out of pocket.

            2) The game does not yet exist in the UK (as is this case with most KS project) – If the publisher is already VAT registered in the UK they will pay VAT as outlined above. If they are not VAT registered, then no VAT is generated at this stage.

            Point 2 is where most Kickstarters fall, meaning no VAT has been paid on any of the EU sales. Once the games are manufactured in China (or anywhere outside the EU) they need to get to the backers, and there are a few ways to do this. How VAT Is collected at this stage is outlined below:

            A) The pledges can be shipped directly to backers from outside the EU. They should be declared as a sale and NOT as a ‘Gift’ and should have a declared value equal to the full pledge (sale) price + the shipping charged. If this value exceeds £15 in the UK then the courier will pay the VAT on the backers behalf before they deliver it to the customer. Usually, in addition to charging the VAT back to the customer they will also charge an admin fee or handling charge for the “privilege” (inconvenience) of them having to deal with this on the backer’s behalf. There’s no guidelines for how these are calculated, and can vary wildly between couriers. We’ve seen charges between £15 and £60 on top of the VAT!

            This method is called DDU (Delivered Duty Unpaid) and is not EU Friendly but puts no onus on the publisher to handle VAT. It is usually more expensive on carriage for the publisher than option C below, and is much more expensive for the EU backer mainly because of the courier charge and increased shipping.

            B) The pledges are shipped from outside the EU with the VAT already paid, usually by the sender. Again they should be declared as a sale and NOT as a ‘Gift’ and should have a declared value equal to the full pledge (sale) price + the shipping charged. To avoid being out of pocket, the payer should still charge the backer the VAT.

            This is called DDP (Delivered Duty Paid) and is the most awkward method for publishers to manage. The customer would have no need to handle the payment of VAT themselves as it will already have been paid, nor will they need to pay a courier fee. This is EU Friendly and HMRC Friendly, but more difficult for the publisher to arrange and normally more expensive on carriage than C below.

            C ) The pledges are shipped in bulk from China to a UK fulfillment company. At port HMRC will charge the fulfillment company VAT based on the commercial invoice. In this instance the sender can legitimately list the factory price on the commercial invoice. Once the fulfillment company pays the VAT they receive the shipment and start sending the games to the backer with no additional VAT being charged.
            The import VAT will be charged back to the publisher.

            This is EU Friendly and HMRC agnostic- by which I mean HMRC gets some VAT but not the full amount. This is currently legal as long as the Publisher is not registered for VAT and NEVER sells a copy of the game after it enters the UK. However, if the publisher intends to make ANY sales after the games have entered the EU they must register for VAT and pay the full VAT amount. While nothing is certain, the changes in the law listed below suggest that this ‘loophole’ may be closed in the future

            D) The Publisher is already VAT registered. In this case, they will declare the total number of sales in their next VAT return, and pay VAT on that amount. Should they ship the products to an EU Fulfillment house (which they may do to utilise cheaper shipping rates) they will still be charged VAT at port as described in option C. However, if they are VAT registered they should also be able to apply for an EORI number, which is free and has no additional requirements on the company. Using this EORI number, they’ll be able to claim back this VAT on the same VAT return.

            Those are the current options that exist, and always have, for non EU publishers offering EU Friendly services. Currently fulfillment companies are not required to police this, which is why so many KS Projects can get away with only paying import VAT, and have been for years. However, as of April 2019, a fulfillment company must be a government approved agent and must ensure its clients are VAT registered if they make any sales of goods already in the UK. The fulfillment house will also need to keep accurate records to show this being applied. If a publisher is reported, the fulfillment house could be required to cease all shipping of the publisher’s goods (effectively impounding them) until the matter has been resolved to HMRC’s satisfaction. If a fulfillment house fails to report any of these infractions they can lose their license and be unable to provide fulfillment services.

            There are various reasons why a publisher may choose one of the 3 methods above. A lot of publishers will choose to warehouse additional stock with their EU partners, making the freight to the UK more cost efficient and allowing them to continue to provide EU friendly shipping on an ongoing basis. Unless the project is intended to be a one off, with no further copies being sold once fulfillment is completed (including selling off any leftovers copies), all publishers will need to become VAT registers by April 2019 to be able to offer EU Friendly shipping and hence we as backers will all have to get used to paying more.

            What we as backers need to understand is that VAT is ultimately our responsibility, not the publishers. By offering EU Friendly fulfillment the publisher is removing a barrier to entry for you to back their game. As you can see, they do this at great personal effort and expense (in both costs and time). We pay the full 20% VAT on products we buy from stores within the UK (or x% in other EU countries as appropriate), so why should we be angry with publishers for charging us the right amount? Yes, it’s terrible that Kickstarters may become more expensive for Europeans, but this has always been the real cost of games. We’ve simply been getting away with paying less than we should up to now, and it’s not reasonable for a non-EU business to take the risk of being unable to sell into the UK/EU because it’s going to cost us more. If you think the cost is too much, bear in mind it’ll still be cheaper than buying the game from the US and importing it in yourself (see option A above).

            From the publishers perspective registering for VAT is not a difficult process, there is an online process you can follow on HMRC’s website. The Publisher’s responsibilities once they are VAT registered are also not onerous , you simply need to send in a return every 3 months. HMRC only really require 4 figures:

            1) The total value of sales you have made into the EU in that quarter (including any KS that have finished in that time)
            2) The total VAT you owe on these sales (20% of the above).
            3) The total amount of VAT-able purchases you have made in the UK that can be reclaimed. This is a whole other topic but will rarely be applicable to US publishers, unless they have an EORI number and are claiming back import VAT.
            4) The total amount of VAT you are claiming back on these purchases.

            Publishers will then pay the balance of Value 2 and 4, with values 1 and 3 being used as checks.

            HMRC also run a simple VAT scheme for small businesses that allows you to pay a reduced rate of sales VAT, but you cannot claim back your VAT on expenses (including Import VAT). This is called the FRS Scheme and some smaller publishers may benefit from this method.

            OK, breath, relax, and then discuss.”

  10. First, I must say I’m in awe at the profound knowledge, care and effort that went into this post. This should be bookmarked by every up-and coming KS creator and used as a basis for their own projects. Immensely useful content, as usual.

    I agree with most of the things you said, but I’d like to stress a couple of them: I wish the in-built shipping cost could be an industry stardard. Like you said, it is truly disheartening to see that the actual “final price” go up crazily after you’ve made your mind about pledging (especially as a non-US/UK/CA backer) – sometimes it results in not pledging at all). I would be willing to have the base price go up a bit more just to have the shipping cost increment “ofuscated”. It might be an “ignorance is bliss” kind of situation, but as we all know, backers’ sensititivities about value and their money, and the way that kind of information is presented, play a huge role during a KS campaign.

    Another thing that I love is how you’d be borrowing the Root system for content/SG, which I think was superb. The thing with KS these days, something that I think wasn’t so obvious during your KS days, is that the barrier between pledging and buying retail is more and more diffuse, or even non-existent at all. Generally speaking, prices have gone up and the (in)famous KS discount is no longer applied (in the most extreme cases, KS prices are more expensive than retail!). In some cases there’s little to no incentive to be backing instead of waiting for retail. I think the way Root did it is perfect from a backer perspective and possibly even for a publisher perspective, because it creates the perfect atmosphere during the campaign (backers are getting things for free, and we all know how we like that) and after, with a boxed expansion that can be sold separately, uniting all stretched content and not only avoiding the dreaded KS exclusivity for future buyers but also giving distributors and brick-and-mortar stores a wink, for the same reason.

    1. Jesus: Thank you for highlighting those points. I tend to agree about the built-in shipping cost. For me, I can add around $5 and be fine with it, but beyond that–especially a double-digit addition–really takes me aback. I understand that creators need to pay for shipping, but we’re already getting pretty great margins by selling directly on Kickstarter.

      I absolutely agree with you about the Root model (stretch goals go into an expansion)–I appreciate the detail you went into here.

  11. Sorry for all the questions. There is so much great stuff in this article.

    The reward level of the first 10,000 already in production arriving 4 months later is absolute genius! It gives the same positive effects of an early bird without the negative side. I strongly feel it is an even bigger motivation than getting $10 off early bird. 100% it is.

    I guess the expansion, created by stretch goals, could not be in pre-production. If it was then I can imagine internet people complaining how the stretch goals are fake. You know how they are. If you say all the future not yet reached stretch goals will be given to the $74 backers regardless then it might remove their motivation of trying to get others to back the project because it is guaranteed. Most likely 90% would be $74 backers. So, would that be shipped to the first printing backers separately at a later date (with the 2nd printing of the game)? If that is the case then wouldn’t that have an additional box, freight, fulfillment and shipping cost? Would that not make the $69 reward more profitable for you than the $74 reward? This is a fascinating problem that I’d love to hear the solution to.

    I noticed that you are are losing the magic 9 on your “best” price ($74). I know you are a fan of 9. Could you make the base components even better and have the price at $74 and $79? What if that 9 in 69 is too attractive? :)

    Facebook Live? Do you mean Kickstarter Live?

    Retailers
    You mentioned not having the game in the stores before backers get it.
    If retailers back the $69 reward do they have to wait for the 3rd printing?
    How many weeks later would the 3rd printing come after the 2nd?
    Do retailers pay $69 for 1 case mean they pay $69 upfront and the rest through paypal during the campaign, or its a deposit and they pay the rest later when the case is on the boat?

    Is there any way a first time creator could hold off on stores having it first? I don’t think it would be possible as they don’t have the economy of scale or assurance before hand of a big campaign.

    1. Gerald: These are lots of great questions! I’ll do my best to answer them.

      1. I would probably already have the stretch goal components in production, but I would only assemble them into the expansion if their stretch goals are met. Otherwise they would be set aside for future promos.

      2. Because the long-tail of the game involves having a reasonable MSRP, and the KS prices are being compared to MSRP, I don’t think I’d want to go higher than the prices I mentioned. I could maybe go with $65 and $69 with a $4 add-on for shipping.

      3. Yes, I meant Kickstarter Live.

      4. If a retailer is a backer, they would get their backed games at the same time as other backers. They just wouldn’t get a discount if they backed at the early level, so most likely they would back for the second batch. I’m not sure how long I’d wait for the 3rd printing (the retail printing). I like the idea of retailers paying $69 up front and paying the rest later (at the retail discount)–that will help their cash flow. Though if I’m limiting it to 1-2 cases, that isn’t all that much cash up front, especially with a tighter delivery window like I’m proposing.

      5. As for first-time creators (or any creators, really), just set a retail release date. Other than backed copies, stores can’t release those games before the release date (distributors will hold them accountable for this).

      1. Those answers were great, and will help for sure, especially 2, 4, 5. Very interested in seeing 1 in action. Thank you.

        Also that is a creative way to resurrect the 9 :) We’ll have to ask Dan Ariely which is more powerful, a 9 or free. But maybe you are not really sacrificing “free” as backers are used to paying for shipping nowadays. They’ll probably feel happy and lucky to only pay $4. Plus it might stop others irrationally feeling some are getting it for free while others are not, even though they still might have to pay $30 to the North Pole.

    1. Thanks! I would mostly use BGG banner ads, but I would like to dabble more into Facebook ads as well. However, I would treat advertising as a nice bonus, not a sure thing–I’d want to go into the campaign with a critical mass of people who are already aware of and excited about the product.

  12. Great post, as usual. I read the comments diagonally though, and didn’t see any mention to Collaborators. You know, taking the time to answer on your behalf, maybe they all (3-4) having a copy with important info to share and not confuse the backers.

    I very much respect your 80h/week program and that would help , moreso if you had less stress . Have a nice Sunday!

  13. I would be very happy with a campaign run in your hypothetical. I like the idea of the first printing level and you pay a little more to get it early. And the people who either miss out or don’t care about the extra months wait they get it at a discount. I like the idea too that all SGs would be a retail expansion so there are no exclusives and everyone that wants the content at retail will just end up buying it. There are some campaigns I’ve backed that I felt like I needed to because I would “lose money/miss out” on the exclusive content. Also getting the game around 4 months after backing would be amazing as I’m used to 12-16 months on average.
    All in all I have missed every kickstarter that Stonemaier has done and if you did come back to KS with this model, for a game that justifies the need of KS, then I would hop on board. Always love your communication and transparency with the community.

  14. For your poll, I answered “Maybe”

    I admit – After learning Scythe, I planned to buy 2 copies of whatever your next Kickstarter was. Seeing how amazing a value the Kickstarter pledge was, I knew that even if I didn’t like it, it would not be hard to find someone who would. I probably would also (if you offered a tier that it made sense to do so) just combine my order with a friend’s to cut down on shipping costs (but then again, if it showed as free shipping, we probably wouldn’t actually do that unless the game showed as cheaper when you bought more copies.)
    Also, I think being a part of the excitement of a campaign would be a blast.

    The reason I didn’t put “yes” for the poll is because I don’t “need” you to be on Kickstarter and I know you haven’t felt it was the best fit for you any more. So, why would I WANT you to use it if you didn’t feel it was good for you?

    I want the company to grow and for you to remain happy in it. It makes for happy customers. If that means continuing to buy retail or direct through other methods, that is what I’m doing. But, yeah, I would be happy you came back to KS.

  15. Excellent article. I’m sure Stonemaier would run another excellent KS campaign. I answered “maybe” because I am inclined toward seeing pro companies “graduate” from Kickstarter so that it remains a venue for startup and small publishers. I am not particularly inclined toward backing projects from bigger publishers.

  16. Jamey, looks like a big company tomorrow will do your idea of 10,000 units shipped in a short time. 8 weeks in this case.

    I hope that guy doesn’t accuse you of stealing HIS idea when you do it, and threaten to sue you. It not being protectable doesn’t matter to him as he ruined someone else’s KS campaign doing just that.

    1. That would be perfectly in line with his character, unfortunately. Though their idea (which I was aware of before I wrote these recent posts–I reference it in one of them) is a little different, as I don’t think they’ll have any stretch goals. They’re just running a straight-up pre-order through Kickstarter in the truest sense of the term.

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