Hello my name’s Matt and this is Pixel Burn where I usually, barring the vagaries of real life, take a snarky look at the week’s gaming news.
Some of you are probably aware that the second annual video game awards happaned earlier this month. Particularly if you live in Europe and stayed up til an ungodly hour in the morning to watch it live. I didn’t do that of course because some of us have jobs to go to, so I watched it later before starting work on a video about the whole shebang. I even had most of what I was going to say already written, but there was a specific part of the awards that initially got me quite excited…then made my blood curdle inside my fucking veins.
The excitement stemmed from this segment where, after a brief moment of confusion, I was treated to the promise of a sequel to Psychonauts. Now I bloody loved Psychonauts, frustrating Meat Circus levels and all, so the idea of even more Psychonauts: with a added “2” on the end no less, was very relevant to my interests. Needless to say, my initial excitement was soon trampled on harder than an unsupervised toddler at the annual Pamplona Bull Run.
Because then Tim Schafer appeared and revealed this wasn’t announcing a confirmed Psychonauts 2, oh no. No, no, no, no, no, no, no, no, no. It was to announce a crowdfunding campaign for a possible Psychonauts 2. Or to put it in simpler terms, Tim Schafer waved around his fucking begging bowl again, promising the Psychonauts sequel fans have always wanted on the condition they give him $3.3 million dollars first.
Thing is Tim, I remember the last time people gave you $3.3 million to play with. More than that in fact. Y’know, for Broken Age?
A game you put out in two halves? The first on Steam as a season pass deal because you’d pissed away all your crowdfunding money, and had to use cash from sales of the first half to fund the second half? Yet still somehow found the money to host a lavish open-door party, with Phil Fish as DJ, in one of the most expensive cities in the world to live and work in. Only to then lay-off a dozen members of staff almost a month later.
[BAD TIM SCHAFER IMPERSONATION]
“Hey guys, are you enjoying the party? I really hope so, because twelve of you won’t be here for the next one!”
[/BAD TIM SCHAFER IMPERSONATION]
And don’t even get me started on that whole debacle around Spacebase DF9. A Dwarf Fortress-clone in space that Double Fine part-funded by selling it through Steam Early Access, only to later pull the plug on it when it didn’t bring in enough money quick enough. After which Double Fine cobbled together everything they already had, which was still missing significant promised game features, and threw it out the door along with the source code. Essentially saying “LOL! FINISH IT YOURSELF!” to everyone who’d shelled-out $20 for it in the expectation that it would be finished.
Note I said “part-funded” there. The rest of the money for Spacebase DF-9’s development came in the form of $400,000 in venture capital from The Indie Fund, Humble Bundle, Hemisphere Games and several others. An investment they all made back within two weeks of the game launching on Steam Early Access.
Going back even further than that, let’s not forget that Psychonauts 1 went way over-budget. Psychonauts was originally intended to be published by Microsoft as an Xbox exclusive: that’s the Xbox one, not the 360…shit, I mean the original Xbox. Y’know, the one that could flatten an entire city if you dropped one of them from orbit. Anyhow, Microsoft ultimately opted out of the deal in 2005 because Double Fine were, and I quote, “expensive and late.”
Although that “expensive and late” remark isn’t directly from Microsoft. They’re actually the words of Caroline Esmurdoc, former General Studio Manager at Double Fine .
“When Ed Fries departed Microsoft, the new management seemed to think that we were expensive and late. The assessment was accurate, though it did not reflect the progress we were finally making toward shipping the game and recovering the development investment.”
Now in Double Fine’s defence, not ALL their games have been born from a financial omnishambles. Titles like Iron Brigade, Once Upon A Monster and Costume Quest for example were developed and released without nary a whisper of any budgetary fuss whatsoever. The recent remastering of Grim Fandango, as well as the forthcoming remaster of Day of the Tentacle, also didn’t require any Kickstarter or Steam Early Access cash.
Even so, it’s still a bit of a fucking cheek for Tim “Spendthrift” Schafer to come out expecting MORE money, AGAIN, with YET ANOTHER SODDING KICKSTARTER.
“But Matt, the Psychonauts 2 crowdfunding campaign isn’t on Kickstarter, it’s on FIG! Ner ner ne-ner nerrrr!”
Ah, silly me, making such a rookie mistake there. Of course it’s not on Kickstarter. It’s on Fig. Let me tell you what Fig is.
Fig is a videogame-centric crowdfunding platform established in August of this year that has so far hosted two crowdfunding campaigns. The first being for The Outer Wilds, an open world sci-fi exploration game, that successfully met its modest fundraising goal of $125,000. The second was for a free-to-play RPG called Anchors in the Drift by Scribblenauts developers 5th Cell, which raised only around one-hundred thousand of it’s half a million dollar goal.
The key difference between Fig and Kickstarter is while Kickstarter only allows you to pledge to a game, in return for some physical rewards, Fig promises to also let people become actual investors who can expect a Return on that Investment, or ROI for short. At least in theory…but more on that later.
Another interesting little detail about Fig is that TIM SCHAFER IS ON THE COMPANY’S ADVISORY BOARD! Yep! He didn’t mention THAT little tidbit during his Psychonauts 2 pitch, did he? Nor did he mention that he’s a board member and shareholder in Fig’s Parent Company, Loose Tooth Industries Inc, or that former Double Fine COO Justin Bailey is one of Fig’s co-founders.
And it seems one of the perks of of being on the advisory board for the crowdfunding platform you’re using, is you get to change the date the campaign ends at a whim. In this snapshot taken on December 4th, the day the campaign started, the funding campaign is shown having thirty-two days remaining. Fast forward two days and what’s this? Thirty-seven days left? How can this be? Are you secretly some lost Time Lord of Gallifrey, Tim? Or did you just extend the time to try and squeeze more money out of it?
Well according to Fig it was always intended to be a 40 day campaign, but a bug with the site’s backend had set it to 32 days instead. What, so you can’t even get the day-counter working properly? Boy, let me give you all my money! Or I could wait to see if the campaign is even a success, Psychonauts 2 ACTUALLY gets made and ends up being a worthy sequel. I loved Psychonauts, and I’ve enjoyed Double Fine’s games, but right now I trust anything finance-related with Tim Schafer attached about as much as I trust advice on healthy living from a Coffin Salesman.
That’s MY personal choice of course. If you want Psychonauts 2 badly enough to give Tim Schafer even more money then more power to you, so long as your decision to do so is an informed one. And that unfortunately means doing your own research. Because most of the gaming press aren’t going to fucking help you.
Coinciding with the announcement of the Psychonauts 2 Kicksta- I mean, Fig campaign, came a flurry of articles and interviews with Tim Schafer about it via the usual outlets. Some, like Game Informer did in this excellent article, spelled out the risks while advising caution and research. Many other sites however churned out little more than puff-pieces derived from the same press release. Eager and willing cogs in an orchestrated hype machine, shilling the idea that YOU can become an investor and get a slice of the game’s “profits.” Not “potential profits”, no. Just “profits”, as though their guarantee had been laser-etched onto the fucking moon by the colossal hand of The Market Itself. Guess how many of these articles mention Spacebase DF9 by the way.
Perhaps the most insulting piece of all however was this shameless, two-bit handjob over at Polygon. A sycophantic scrawl so brown-nosed and servile you’d honestly think the wri ter was angling for a job at Fig. “Anyone can profit from it’s success?” Bollocks can they! To invest in Psychonauts 2 right now, in a way that’ll actually get you any meaningful profit whatsoever, you are required to be an Accredited Investor under United States law. And to qualify as an accredited investor you need to have either $1M in net worth, not including the value of your primary home, or a yearly single income of $200k or a combined household yearly income of $300k over the previous two years.
“But Matt, Regulation A+ of the 2012 Jumpstart Our Business Startups Act, or ‘JOBS’ for short, allows Fig to raise investment from multiple sources including UNACCREDITED investors.”
Did you read about that in this article by any chance? Also on Polygon and also by the same sodding writer? An article that reeks so much of a press release, slightly rejigged just enough to make it sound like it was written by an actual human being and not a robot powered by shoving $10 bills up its arse, that merely reading the headline made me want to projectile vomit my own spleen through three feet of solid concrete.
And besides, I’m still correct. Right now any interest you give Double Fine and Fig as a potential unaccredited investor is completely non-binding, involving no obligation or commitment of any kind.
Y’see the new rules allowing unaccredited investors to officially invest in a Fig-funded game don’t come into effect until the 29th January, 2016. What Fig are actually doing right now is inviting people to “reserve” an investment opportunity, in anticipation of this change becoming federal law.
So for the time being, while you’re under no obligation to give Fig any money, Fig are also under no obligation to reserve any shares for you. In fact there’s a $1.5 million cap on all unaccredited investments, so which offers do you think are going to get priority? The big ten-grand chunks from people with way more cash than they know what to do with, or the comparitively-piddly bare-minimum investment of $500 you scrounged from behind the sofa?
Either way, you’re still technically not an investor yet, meaning not just anyone can “profit from it’s success.” Speaking of profits, lets talk money.
I know this stuff is boring but please bear with me. Assuming the right laws go into effect, your $500 reservation is accepted and Fig offers you a share in Psychonauts 2, you won’t see any returns on that money until the game is finished and goes on sale. That’s estimated to be sometime in 2018 by the way, meaning at least a two year wait from your initial investment before it starts to pay dividends. Even then Psychonauts 2 has to sell at least 670,000 copies, at an average wholesale price of $21, whereupon your return on investment will be…exactly the amount you put in.
Yep, that’s just to get your investment back. Or to put it in business-speak, that’s an ROI of 0% after two to three years, if not more
Also a very generous prediction considering the original Psychonauts only sold 100,000 copies during its first year in 2005. A result that contributed to the CEO of its publisher, Majesco, resigning, and the company’s stock plummeting. But that was then of course. Psychonauts has since built up a cult following and sold almost 1.7 million units in total. Except that’s nearly 1.7 million copies over TEN years. Even if Psychonauts 2 hits that target in half the time, you’re still looking at five years before you can expect a return on any investment.
By the way 1.2 million of those sales were only during the last five years, and not all of those sales were at full-price either. In fact Fig’s own infographic shows the majority of these sales came from Humble Bundle deals, and when developers put games in a Humble Bundle they can usually expect to earn about $1 per copy. Even the Steam and GOG.com figures don’t take into account the game’s numerous discounts during sales, or that it now retails for $9.99.
Still, if Psychonauts 2 sells as many copies as Psychonauts did then an investment of $500 will give you a profit of $300, or an ROI of 60%. You’d still have to wait at least two to three years without any return whatsoever though, and that’s on top of however long Psychonauts 2 takes to hit nearly 1.7 million sales.
By now you’re probably thinking “Enough Money talk Matthew! What if I don’t want to be an Investor, huh? What if I just want to support the development and get a free t-shirt?”
That’s actually the least-risky option, since you’re at least guaranteed something by way of a tangible reward. Kind of. You need to chip in at least $150 before you qualify for a t-shirt.
Double Fine have learned some lessons from their Broken Age Kickstarter – for which they still haven’t delivered all the promised backer rewards by the way – so most of the incentives are digital this time round. Which is fair enough! Making various gewgaws and nicknacks, then posting them around the world, can be expensive.
Which also gives us a clue as to why the the whole “investment” angle is being played-up in the press and promotional materials. That, my dear friends, is because it’s a great deal for Double Fine. They only have to pay out dividends if the game is a humungous success, and they get to raise up to $1.5 million without having to splash out on physical rewards and shipping costs. It’s practically free money!
And why should games journalists care about informing you of this stuff? It’s not like they’re spending their own dosh or anything, and they get to hang out with Tim Schafer for a while! Isn’t that cool? Aren’t you happy for them? Now start throwing your money at the screen, filthy gaming plebs. After all, according to Polygon: “It’s up to fans to push funding over the top!”
Nevermind that you’re not getting even a fraction of the protections a standard games development agreement would give to a publisher. You get no stake in the ownership of the IP, no right to make some of the funding conditional on reaching certain milestones, and your investment is not counted as an advance againt royalties. They even get to do what Gearbox allegedly did with the funding for Aliens: Colonial Marines, by using assets raised for one game to pay for the costs of another game. Meaning your Psychonauts 2 investment may not actually get spent on Psychonauts 2. By the way you also have no recourse if Double Fine fails to make the payments owed under the agreement, or if the whole thing goes tits-up and the game is never made. Also be aware that you won’t see a single cent from any DLC, sales on VR platforms, or sequels, prequels or spin-offs. So if Psychonauts 2 is released at a steep discount for example, and Double Fine flog a shit-ton of DLC for it, you’re screwed.
With all that in mind, if you still want to actually INVEST in Psychonauts 2 as an INVESTORY TYPE person of INVESTMENT then be my guest. I’m not telling you how to spend your dosh. just trying to give you an idea of some of the risks, which is more than some people are willing to do.
Otherwise, if you’re THAT desperate for Psychonauts 2, ignore the hype from so-called journalists and stick to pledges and rewards. It’s not risk-free, but still safer than chucking away $500 for potentially nothing with absolutely no recourse whatsoever. Although do bear in mind however that unlike Kickstarter, which holds creators to a legal requirement to follow through on their projects, and give backers a recourse if they don’t, no such provisions are apparent on the Fig website. Meaning the only thing holding Tim Schafer to account is Fig itself, which has Tim on its advisory board, and Fig’s parent company, of which Tim is a shareholder and board member.
Hmmm, yeah. Methinks I’ll wait til Psychonauts 2 comes out on Steam. If it comes out.
That’s all for this episode of Pixel Burn. If you liked it then do me a favour and click the thumbs up button down below, and let your friends, family and Fig’s marketing team at Polygon know all about it. At the very least I hope you found it tolerable. In the meantime, til next we meet, as always, you can go now.