23 February 2014 | 26 Comments
Last July, the Kickstarter gaming world was rocked by the revelation that the creator of a successfully funded Kickstarter project, The Doom That Came to Atlantic City, wasn’t going to make or deliver any of the games he promised to make. At the heart of the project update this creator posted to cancel the project was this line: “Unfortunately I can’t give any type of schedule for the repayment as I left my job to do this project and must find work again.”
When I read that, I went over to my little list of future topics to write about on this blog and jotted down, “KS Lesson: Don’t quit your day job.”
I didn’t do anything with the topic for a while. A lot of people were discussing that project at the time, and I wanted to wait until the buzz died down a bit. People were still mentioning the project on end-of-year lists in December, which is a testament to the how one bad project can stay in peoples’ memories even more than hundreds of good projects.
And then…I quit my day job. So I didn’t feel particularly qualified to write a post about not quitting your day job.
I’ve now been running Stonemaier Games full-time for 2 months, a very small sample size. Although time will tell if this is something I can continue to do for years and years, so far I feel like I’ve taken intentional steps towards doing this full time that keep my backers’ best interests at heart, and I wanted to share with you how I’ve done it in case it’s something you’re considering after a successful project.
First, let me address the temptation of quitting your day job after successfully funding your Kickstarter project. Say you raise $100,000 on Kickstarter to make a board game (let’s say it’s $100k after all KS and Amazon fees). That’s a lot of money, and it arrives in your bank account all at once. Most people could live on $100k for several years.
Plus, this is the dream, right? Doing something you love, being creative, interacting with people who share your passions. Who wouldn’t want to do that full time every day?
But the $100,000 isn’t for your living expenses. Kickstarter’s guidelines specifically say that the platform can’t be used for “fund my life” projects. You can’t use Kickstarter to raise money for your weekly grocery bill, so you also can’t use money for a board game project on Kickstarter to pay for those groceries. That money was raised for a specific purpose: To produce a board game and deliver it to backers.
The truth is, you’re probably going to need every penny of that $100,000 to manufacture and deliver your product. Even if you budgeted very carefully to accomplish that goal, assume that everything is going to cost about 10% more than you anticipated, just so you have some buffer room.
The trouble that many Kickstarter creators in any category will run into is that it takes a lot of time to run a business, even if that business has exactly one product. So how do you fulfill the promises to the backers of your successfully funded project and still make money to pay the bills? Here’s how:
- Don’t change anything for as long as possible. It’s that simple. Do both your day job and your Kickstarter job as long as you possibly can. You’ll know when you can’t do it any longer because you’ll start to do Kickstarter stuff at your day job. I did this for about 2 months after the Kickstarter for Euphoria ended.
- Don’t pay yourself. This goes into the “fund your life” category. The money you raised on Kickstarter isn’t for your personal enjoyment. However, the nice twist is that if you have $5000 of your personal savings earmarked for Kickstarter in case you didn’t raise as much as you really needed, and instead you overfunded, treat yourself to something nice with a little bit of those funds. For example, I bought a pair of jeans.
- Try to reduce your day job hours. Take a very close look at your personal budget. Look at how much you earn each month and how much you spend each month, and use the difference to calculate your proposed reduction in hours. So, say you make $4000 a month, and you spend $3000 a month. As long as you have some money in savings for unexpected life events, those numbers would indicate that you could reduce your day job hours and salary by 25%. Propose the idea to your boss and see what they say. Many bosses are happy to save money. My boss loved the idea, and so I stopped working on Wednesdays. Having that one day completely devoted to Stonemaier made a huge difference at a pivotal time.
- Before doing anything else, produce and deliver the product to backers. This is huge. I don’t care how much money you raised–if you haven’t delivered the product to your backers, that money means nothing. What if you budgeted $30,000 for shipping and it costs you $50,000? What if the price of cardboard skyrockets and the game costs twice as much to make? What if you get sued? SO many things can go wrong with a Kickstarter. Assume that they will and deliver the product before making any life-changing decisions. I had delivered most copies of Euphoria before my last day at work.
- Create alternate revenue streams and budget for the future. When you really start to think you want to run your Kickstarted business full-time, look towards the future. The revenue from your Kickstarter project was a one-time deal–sure, you raised $200,000. But you’re going to spend the majority of that money on making and delivering the product. How will you earn steady income month to month for the next year or so–not just enough to cover your living expenses, but also to keep enough cash flow to make more copies of your product? I diversified our revenue streams by arranging partnerships with production partners in Australia, China, and Europe, making plenty of copies of Euphoria for retail sales, developing other games for future Kickstarter campaigns, and partnering with a developer to create an iPad version of Viticulture.
At this point, you might be just fine–you might have found a great balance between your day job and your Kickstarted business. If so, stick with it. If not, consult with friends, family, and your business partner(s) before taking the next step.
Here are my recommendations for how you do it. Of course these will vary widely depending on the type of organization you work for.
- Tell your boss one-on-one before any other coworker. Your boss should be the first person to know–you don’t want them finding out from another employee. Just like a break-up, don’t make it about your boss or your job–explain that the decision is rooted in your passion for your growing company. I debated the best way to do this, as I was worried about my boss’s response. After chatting with several friends and family members, I decided to tell my boss first–privately–and it was absolutely the right decision.
- Don’t burn bridges. Some people out there truly despise their jobs, and it can be really tempting to go out in flames. Resist those temptations. People are going to remember you by your exit, so exit gracefully and respectfully. I did everything I could to help with the transition–in fact, I still drop by my old job when needed to help train people who are now doing what I did.
- Coordinate the logistics of your future employment in advance. Remember when you started your day job, and you filled out a few forms for human resources to take of your health insurance, salary, 401k, life insurance, etc? Well, now YOU are human resources, so you have to do all that stuff. Contact your insurance agent for health care, life insurance, and disability insurance. Transfer your 401k to an IRA (I use and recommend CapitalOne). Figure out a schedule to pay yourself from company funds. If it’s just you, payroll is actually quite easy–you don’t have to worry about taxes until next year (your salary counts as expenses against your company revenue–your accountant will take care of it). Also, if you get a lot of company mail, sign up for a forwarded PO box.
Finally, the day comes when you’re working for your company full-time. I’ve learned a few things about working from home, and I bet other people can add to these comments.
- Get out of the house once a day. This was my biggest concern when I started working full-time. I’m an introvert, so I’m perfectly happy only seeing people a few times a week. The problem is, I would rapidly become a hermit if I lived that way. Even as an introvert, I need to interact with people (not just my cats) on a regular basis. Plus, I need to do things like wear clothes and shower–I’m more focused on work when I feel like I’m at work, and it’s hard to feel that way when I smell like bed. So I’ve tried to get into the habit of leaving home at least once a day or inviting people over once a day. Sometimes that means not taking care of all errands on a single run, but for the most part it’s meant that I get to play a lot of games with people multiple times of the week.
- Separate work and personal space. I’m single, and I have a two-bedroom condo. For the last year, my second bedroom has been the place where I keep game supplies, and my bedroom has my computer, bed, clothes, and other personal effects. When I started working full-time, I spoke with a professional organizer, who recommended that I completely separate my work and personal space. It’s important to create a mental and physical divide between the two. So now my bed, clothes, and books are in the small bedroom, and all Stonemaier stuff, my desk, my computer, and my playtest/prototype supplies are in my “office.” Someday I might expand into a separate office space, but for now this is all I need.
- Be intentional about work and play. When people learn that I work for myself at home now, the most commonly asked question is, “Is it hard to get work done?” My answer: “It’s hard to not do work!” Within minutes of waking up, I’m replying to e-mails, blog comments, BGG posts, etc. Then I’m designing and developing games, coordinating logistics, and planning for our next Kickstarter. I stop working around 1:00 am when it’s time for bed. So…that’s 16 hours of work a day and 8 hours of sleep. Rinse, repeat, no weekends. So other than getting out of the office or inviting people over, I try to be really intentional about not constantly working. Sometimes that’s a 20 minute break to play an iPad game, or I watch one extra TV show after eating dinner. And before I go to bed, I make sure to read fiction for at least 20-30 minutes, because it completely gets my mind off work so I can sleep well before starting the cycle all over. Everyone has different needs in this area, so figure out what’s right for you.
My conclusion for this post is the same as when I started writing it last summer: Don’t quit your day job. But if you realize that you can afford to live your life and at least test the waters of a career in whatever your Kickstarted business is, I hope this template gives you a starting point.
If you have any thoughts, ideas, or questions to add in the comments, I look forward to seeing them.