Kickstarter How does a Kickstarter Bleed Money?

SkidAce · Mar 23, 2013

I suppose its simple, but I'm missing the point. Money comes in, how does it go out?

http://www.kickstarter.com/projects/178087494/thon

Henry · Mar 23, 2013

This post may help explain:

http://boardgamegeek.com/thread/949388/thon-kickstarter-cancelled

I'm as surprised as anyone though. First time I've seen something like this.

Morrus · Mar 23, 2013

SkidAce said:
I suppose its simple, but I'm missing the point. Money comes in, how does it go out?

http://www.kickstarter.com/projects/178087494/thon

I presume something causes a lot of people to cancel their pledges. I don't know enough about this specific one to know what though.

Hand of Evil · Mar 23, 2013

I would say outside forces, family issues, lawsuit, health, disagreements with team...something to force the creator to stop production.

darrell_uk · Mar 23, 2013

Could the bubble be bursting?

Morrus · Mar 23, 2013

Hand of Evil said:
I would say outside forces, family issues, lawsuit, health, disagreements with team...something to force the creator to stop production.

You got it backwards. He stopped the Kickstarter (apparently) *because* it started to bleed money (i.e. floods of people started cancelling their pledges); it didn't bleed money because he cancelled it.

Morrus · Mar 23, 2013

darrell_uk said:
Could the bubble be bursting?

One guy cancels his Kickstarter and the bubble's bursting?

MatthewJHanson · Mar 23, 2013

With Kickstarter you don't actually pay the money until the campaign ends, so at any point in between you are free to cancel you pledge or reduce it from a high priced reward to a lower one. . I had a few days in my recent Kickstarter campaign where I actually had a net negative, and I've seen other other campaigns that will have a few net negative days, but never anything as dramatic as happened with THON.

I'm not sure why that happened but here's some possible thoughts:

People might have been initially excited, but then as they learned more about the project they became less interested.
People might have joined early to grab some of the exclusives even if they were unsure that whether or not they really wanted to support it.
Another project might have come out mid-way through the campaign, and people with limited budgets decided to change what project they backed.
Peer pressure. Normally this works in Kickstarter's favor, but in this case it might have backfired. If you hear your friend cancels a pledge, you might do the same.

Janx · Mar 23, 2013

it sounds like from the 2nd link that the creator was changing what the rewards were (not adding new ones, changing existing ones, and had some gaps in his communication (like he stepped away for a while), and couldn't answer some questions about the game (like the size of the minis).

this caused backers to back out, which caused a rush. it probably didn't help that they declared their reasons online, so it incited others to also back out.

I would posit that you'd want to start a Kickstarter after having everything all planned, the product design, rewards, etc. It looks like kickstarters add rewards in an ad-hoc fashion, but I would bet that this is a marketing ploy to induce excitement as the number gets higher. I would expect that the creator has these worked out in advance, so he's not unprepared for the higher levels of rewards.

Or at least anybody who doesn't plan it that way, is adding risk to their project.

I would think, the time to launch a kickstarter is when your planning is all done, and now you need money to go into production and execute on the plan.