Crowdfunding and Video Games: 2018 Mid-Year Update

It has already been six months since my last check on the crowdfunding trends for video games. With everyone taking it slow because the summer is coming (I am joking, everyone is rabidly preparing for gamescom), here is the latest data and what I make of it. This is part one, as I will do another blog post on Tabletop Games.

As a reminder, I use the word “semester” for half years.

Video Games on Kickstarter

Looking at the total amount of money successfully raised through Kickstarter for video games, the first half of 2018 is at a level with the first half of 2017, sitting at +$400,000 from last year. It puts that semester as the best half year, in total amount raised, since the second half of 2015.

The total amount of money pledged so far in 2018 is the highest it has been for the past 3 years.

But the money pledged only tells part of the story, as we know now.

Looking at the total number of video games campaigns seeking funding on Kickstarter, there is an obvious, regular decline. The numbers are going down overall: a -13% drop from the previous semester, compared to a -5% drop from the previous periods.

The total amount of video games campaigns launched is at the lowest since the first half of 2012.

Interestingly, that drop in number of projects is not ostensibly affecting the overall number of projects being successfully funded. The number of funded projects compared to the previous semester is about the same, going from 168 funded projects to 166 funded projects.

The drop in the total number of projects is mostly centered on projects that fail to reach their funding goal.

Looking at the corresponding “Success ratio”, this is at its highest for video games projects since 2013.

I do not believe that this means that it’s become easier to get funded. It probably derives from creators with the inability to put together a good campaign moving away from crowdfunding, as it is now understood how much work is required to manage a successful Kickstarter.

It is an interesting data point though, as there seems to be a perception from some studios I am talking to that crowdfunding a video game has become near impossible.

Looking at the number of campaign per tier of funding secured:

  • the past semester saw a higher number of projects raising between $50k and $100k than the previous two semesters
  • the number of projects raising between $10k and $50k and the number of projects raising less than $10k are at the lowest since 2013
  • this was the highest number of projects raising more than $500k in a 6 months period since 2015 (equal to the second semester of 2016)

It is hard to tell if the low number of projects raising under $50k highlight a trend of projects with smaller goals, and potentially lower production values, are receiving less funding, OR, if successful projects overall are managing to raise more money (bringing more projects to the higher tiers).

The decline over the years in the number of funded projects doesn’t affect the number of projects raising more than $50,000

Looking at the amount of money per tier of funding secured:

  • With two projects raising more than $1 million in the past semester, it should not be too surprising to see that a significant part of the money came from the larger projects.
  • The total amount of money raised by projects in the $100k to $500k range is at its lowest since 2012. Projects in that tier raised the lowest amount on average since 2011 (prior to video games reaching scale on Kickstarter).
  • Projects in the $50k to $100k tier have raised $1.5m+ in the first six months of 2018. It was also the highest average amount raised during a six months period since early 2012.

Projects in JPY (Japanese Yen) are only second to projects in USD in the most recent semester, in terms of total amount of money raised. It would be easy to think this is entirely thanks to The Good Life, and its $720,ooo raised. However, I wanted to point out there were 4 other projects in JPY last semester that got successfully funded, including “十三月のふたり姫 ” that raised about $65,000.

I think this is important to keep in mind as there is still a notion that you have to run your projects in USD in order to be successful. Your project’s quality and your capacity to build and engage with your community matter more than the currency you choose to run your campaign in.

(Disclaimer: I am working on The Good Life campaign.)

Video Games and Other Crowdfunding Platforms

In January, I wrote an article for PC Games Insider on crowdfunding and video games, in which I drew a picture of the state of crowdfunding for video games, not just only on Kickstarter, but across four different platforms: Kickstarter, Fig, Ulule, and Indiegogo.

I have since then refined my methodology, and found that I had overestimated the Indiegogo and Ulule numbers, especially in the case of Indiegogo. Both platforms are only anecdotally relevant to crowdfunding for video games, except for a rare outlier running on the platforms once in a while (Noob, the video game on Ulule in 2017, for instance).

It does leave Fig as a second platform to keep track of, which is relatively easy as they curate their campaigns and the volume is small enough to handle manually. Here are few high-level data points on Fig’s performance over the past few years – just keep in mind the fact that Fig is a curated platform when comparing its numbers with Kickstarter’s.

Fig is a much smaller platform than Kickstarter, with fewer projects. It has done very well whenever a high-profile project was released on its platform, but it is interesting to see its level of funding outside of these large projects is modest, raising on average $40,000 for its successfully funded projects.

There is a higher ratio of projects funded on Fig than on Kickstarter, probably thanks to the curation process. However, the percentage of projects getting funded is significantly lower than previously, in this past semester. The low number of projects means this not necessarily statistically relevant.

Beyond the curation, another important differentiating factor for Fig is fact that the campaigns allow users to back for a reward (like on Kickstarter), or as an investment in the project.

The graph above highlights Fig’s strengths when it goes to lower-profile projects, where it displays an ability to raise Project Equity funds.  In the first semester of 2018, 75% of all the money raised on Fig was through this scheme, up from 66% the previous semester which had a similar profile (roughly same size of projects and same number of projects). As before though, this might not be statistically relevant considering the low volume of projects.

Kickstarter and Fig Numbers Side-by-Side

Adding Fig numbers doesn’t tell a very different story when considering the total number of projects funded during the past 6 months. There is a slight drop in number over the past few years, but projects haven’t fled to another platform.

As for the total amount of money raised, this is likely the same story too. Large projects have chosen Fig over Kickstarter in the past couple of years, but none in the past 12 months (with the exception of The Good Life, that tried to get funded on Fig in September last year, but didn’t manage to reach its goal then).

It is interesting to note that the five projects that were successful on Fig this past semester raised a total of $57,000 through the reward scheme of the platform, putting the emphasis on the equity side of their model to get successfully funded, setting the platform apart from Kickstarter which solely relies on the rewards system.

Considering the total amount of money raised in the past year on Fig, and the amount of money it requires to function, it might be interesting for its team to consider either widening its reach and loosening the curation criteria, or, to focus solely on high-profile projects that are making a significant impact on the amounts the platform raises.

In a couple of months, I might do a deeper dive into the Fig campaigns as there is much to learn in looking at each of them.

 

 

 

Kickstarter and Games – 2017 mid-year status update

Like last year, I did a mini-research on games on Kickstarter at the mid-year point. It allows me to keep an eye on any trends, and to check hard data properly a little more often. On top looking at the Games category and the video games and tabletop games sub-categories, I am also throwing in a few numbers on Kickstarter overall.

As a side note, it was interesting to see that our Campaign Review service has been very popular this year, and I updated the page about it.

A few disclaimers on this article and the data:

  • A significant change I have made in my methodology is to use different exchange rates. I used to have a fixed exchanged rate applied to all projects. I now use the average of a given year. It will have an impact on the numbers you saw in the past.
  • I use the term Semester for a half year, from the Latin semestris, “of six months”.
  • Data is, as usual, collected with the help of our friends at Potion-of-Wit.

Kickstarter Overall – a steady course

Before we get into the numbers, I wanted to highlight a few things that have happened in the first half of the year:

  • As a Public Benefit Corporation, Kickstarter has released its first annual Benefit Statement. It is a very interesting read.
  • Kickstarter launched the Hardware Studio initiative. It comes on the heels of increasing reports of Kickstarter projects being copied and beaten to market.
  • Guest Pledging was introduced, allowing to back a project without having to create a user account.
  • And lastly, but more anecdotally, Yancey Strickler, the current CEO of Kickstarter, is looking for a replacement.

The last one I wanted to highlight as I sometimes find my research in media discussing Kickstarter, and they came up quite significantly in relations to that last announcement. But to the numbers, that’s what is of interest here.

As I have mentioned in the past, the Potato Salad campaign had a huge influence on the number of projects submitted on Kickstarter. If you are wondering about that sudden spike in the second half of 2014, that’s why.

Overall, we see a decline in the total number of projects launched on the platform, on quite a steep curve. However, the number of projects that get funded is seeing a very small decline in comparison. It’s also important to note that there are indications that the second half of a year usually performs better than the first half. And that’s usually true across all the categories.

You can see this effect a bit in the total amount of money raised by successful projects:

Despite the slight decline in projects, the first half of 2017 has been the best first half for the platform historically. It is very hard to predict how the second half will go, but it is likely that it will outperform the second half of 2015, making 2017 a record breaking year, improving from 2016.

 

Quick look at the Games category

I will share these numbers and chart as is. The analysis of the two main subcategories are much more telling of the current trend.

Video Games – at a stable pace

You have observed the growth of the Games category? Well, video games are actually not growing.

Video Games are keeping the same rhythm as the previous year, with roughly 30 projects per month getting funded. The second half of the year should probably see a few more projects funded than have been so far in 2017, if it follows the pattern of previous years.

As seen in the past data analysis, the Video Games subcategory is very dependent on hits when looking at the total amount of money raised. In that sense, the first half of 2017 has been the best semester since 2015. And yet, this is a far cry from the best semesters in that subcategory.

A stable number of funded projects, a growth in the total amount raised, despite Kickstarter having lost its novelty years ago now, it is still a platform that is consistent as a source of funding for games, the same conclusion drawn on the blog post from the beginning of the year.

An interesting evolution of the numbers when looking at projects tiered by amount raised, there is a growth of the number of projects raising between $100k and $500k recently. It seems this is a range of funding that is more accessible than it used to be, and could be where Kickstarter could grow its Video games subcategory.

 

The crazy growth of Tabletop Games

If we can’t see how the Games category can be performing so well from looking at Video Games, it probably means that Tabletop Games are doing incredibly well. That is quite the understatement:

Looking first at the number of projects, it is obvious that this subcategory of projects is bonkers:

  • There is a strong and steady growth of the number of projects that are funded.
  • There was no “potato salad” speculation effect in the second half of 2014 (at least, not as visibly as in other parts of the Kickstarter platform).
  • The number of projects failing is stable, meaning the success ratio is steadily increasing (62% of the projects got funded in the first half of 2017)

Following the steady growth of funded projects, it is not surprising to see a record breaking half-year, and if current trends continue there is no way that 2017 is not going to be the best year ever for the subcategory too.

Let me share the number that I find the most mind-boggling in the mid-year update:

24% of the money raised by successful projects on Kickstarter were Tabletop games projects

Of course, the huge success of Kingdom Death Monster 1.5, that raised $12.3m, plays a role in that impressive performance. But the growth is seen across all the strata of funding:

Across all tiers (except the lowest one) this was a record breaking semester in the total amount of money raised.

 

Conclusion

With board games growing so fast, and the rest of Kickstarter being still quite stable, it is clear there is a shift not visible at a first glance on the platform. There is a slight decline, or at best stability, across all categories, with the exception of one that keeps growing steadily.
By the time Kickstarter has found its new CEO, I can easily imagine games representing a third of the money raised through the platform.

And Games projects might be blurring the line between tabletop games and video games further, like the currently live campaign of Beasts of Balance:

New report out: F2P PC Shooters in Europe

Available now is our latest report. This time around we are analysing PC Free-to-Play shooter games. I am always tempted to say it is about FPS games, but there are a number of games in that list that are not in the first person.

The report provides an overview the market as a whole before going into specific, country-to-country market data and then even further into a game-per-game analysis. We took the individual game analysis a level further, and specifically analysed each game’s F2P mechanisms and the way their stores function – including the ways in which games are managing soft currency and the hard currency.

Below are a few samples of the additional graphs we generated, using the additional information on the way the games’ stores function.

 Shooter F2P titles - percent of items impacting gameplay

World of Tanks - shop profileTeam Fortress 2 - shop profile

Planetside 2 - shop profile

Have a look at the table of content for more details on the report. It covers 15 titles across 178 pages and costs £4,000 (incl. tax):

You can purchase the report directly from our website or you can contact us.

Limited offer – 85% discount on our MOBA report

About a year ago we released our in-depth market report on MOBA games in Europe. As we are working on new projects at the moment (if you are really curious, feel free to catch us during GDC and ask in person), we want to give the opportunity for a larger audience to access some of our previous work, so we are experimenting on this front through a time-limited sale on that report.

Until the 6th of March, the MOBA games in Europe report is available at an 85% discount, from £2,200 to £300. Just go to our Gumroad page and enter the discount code wintersale2015. Read more

New report out: MOBA games in Europe

Available now is our latest market report. We have taken an in-depth look at the MOBA sub-genre, specifically its presence on the European markets. This is an extensive report, looking at each game as well as every single market, and drawing an interesting picture of the current trends in the genre.

With an estimated revenue for all the games in Europe of €173m ($237m) for 2013, MOBA games have been growing very rapidly in the past few years and should continue to develop for the foreseeable future. Below, you can find the foreword to the report as well as the table of contents. As usual, don’t hesitate to contact us if you have any questions.

The MOBA genre is still in its infancy. Born out of the Warcraft 3 mod community with the Defense of the Ancients map, it was a genre limited to that space for many years. As this community grew it reached a critical point that either prompted game studios to consider the genre as viable for a stand-alone game, or the community matured enough to take their expertise from modding into full game development.

 

The definition of the MOBA is still evolving. Like any newly created popular terminology, its usage will vary from person to person until it reaches a point of compromise (or academics dissecting the game landscape narrow down a very specific definition). We have decided to stick to a rather strict definition for this report and only integrate the games that have directly inherited from the Defense of the Ancients core mechanics: players in teams each control a powerful unit and try to outplay the opposing team by controlling the flow of a battle, destroying objectives or simply killing the enemy players’ units.
For players, the main appeal of a MOBA lies in the depth of gameplay: the numerous units available, the number of development options for those units and the understanding of the different match-ups to react to the opponents’ decisions. It also means these games are very competitive, require a great deal of time to be properly mastered and have created communities that are highly engaged, yet passionately demanding and not always tolerant (one could say toxic).

 

However it is that passion from the players that it is a contributing factor in MOBAs emerging as a major genre at the moment – and the audience of those games is equally demanding when it comes to the quality of the games, making it a difficult genre to enter.
It doesn’t appear to scare new entrants though. As we finalised this report earlier this year there, came a point where we had to stop adding titles to the list of announced MOBAs as these new game announcements were being made on a weekly basis.
We feel this report is being released at a very interesting time for the genre. It will allow a line to be drawn in the sand, and a snapshot to be created for the state of the European MOBA market. And it should help us (and you) see where the market will go from here and how this new genre will develop and grow.

 

Thomas BIDAUX, ICO Partners CEO

February 2014

Brighton, UK

MOBA Games in Europe 2013 – Table of content from ICO Partners

You can purchase the report directly from our website or you can contact us.

New report out – Client-based MMORPGs in Europe

client-based-mmorpgs-europe_coverWe are very happy to announce that we have released our first market report directly available on the website. This is a very specialised report as we looked into client-based MMORPGs specifically, with a deeper look on how they perform in the largest countries of the region (UK, France, Germany, Spain, Italy and Poland).

Here is the top-level bullet points on what you can find in it:

● General overview of the market: global size of the market, respective size of the key countries, business models popularity.
● Key data for the main countries: market size, preferred payment types, most popular games per language.
● List of the client-based MMORPGs in service Europe.
● Profile for each publisher with estimated revenues.

If you are curious about it, I strongly recommend to have a look at the table of contents of the report, and Joost from SuperData Research (we partnered with them on that report to make the research as complete as possible) has an article with a few key insightsfrom the report:

● The client-based MMO market totalled $1.3 billion across its major markets in 2012.
● Three publishers dominate the space, generating 70% of all revenues.
● Germany is the largest European client-based MMO market with €474MM in 2012 sales, more than double the size of the UK market (€281MM) and France (€222MM).

Since the inception of ICO Partners, it has always been our objective to provide more than our usual bespoke reports that we build for our clients. It took us some time to get to the point where we were able to build that first market report, and Diane has spent all her time for the past few months on it. Now that it has arrived, we have other segments of that market that we really want to dig into. You can expect more content on the Publications section of the website this year.

Kickstarter – Beginning of December numbers

In preparation for this week’s panel at Evolve, I refreshed the data collected on the successful Kickstarter Video Games projects. We decided at the last minute to focus more on projects stories rather than talking about data on the platform, but as the work was done, and it was 3 months since the last time I had a look, now is the perfect opportunity for a blog post on this.

The best is still for you to have a look at the document itself.

The panel this week was very one-sided in the end. Kickstarter has interesting challenges ahead of itself, but it is there to stay as a path for funding. That’s a very good thing in my opinion. The ecosystem will evolve, get more mature and we will get a few good and bad surprises still. A point I think I missed making during the panel though, is the very strong reliance on media, whether you talk about traditional media, or social media.
Social media is not much of a concern – they lend themselves very well to promote crowdfunded projects and Kickstarter makes a good use of them (Friend’s Discovery, I curse thou and my wallet too!), a number of projects were successful thanks to the support of traditional media and there tend to be some fatigue on their part. As the novelty of Kickstarter is wearing off, they tend to be either more critical (a good thing!) or not interested (a sad consideration).
Last thing, I will share my number two tips for going to Kickstarter, as asked at the end of the panel (arguably, we were asked the number 1 tip, but hey):
1# Become a backer yourself. Go on there, find projects you like and give them money. Go and live through a project’s campaign till its end (happy or sad) as a backer. That an important position to understand.
2# Do your homework. Don’t go on kickstarter without checking which projects work, how much they ask for, what they offer to backers, etc. especially, look for projects similar to yours.

Kickstarter Zeitgeist – part 2

Since last June and my blog post on Kickstarter, I haven’t really moved on. I am still quite obsessed with it and its evolution.

I have run the same numbers (same methodology) as last time and made a short presentation under the same format to see where it was going. You can find it below:

So the main take away for me, is that the Median (and bear in mind my sample excludes project below $10,000) is really growing, at $29k now, making it quite interesting for studios of the right size (or with the right size of projects rather). The very large projects have slowed down, probably due to the summer. Overall though, there is still way more money injected into the game industry via Kickstarter now than ever before. And I think that’s good.
Last time, I hadn’t the time to run the Appsblogger data and integrate them in my slides. Rather than mix them with the set of slides this time around, I thought I would make a deck just for those numbers, especially as they are aging rapidly (as a reminder, these are the data of all Kickstarter projects, regardless of their success or failure, across all categories):

Hopefully, you will find interesting informations in there. Finally, I wanted to point out 2 blog articles from Kickstarter themselves:

 

There. I can consider my current Kickstarter itch scratched. It might come back, in which case I will likely share more than just data and data analysis.

Kickstarter Zeitgeist

Perhaps, like us, you’ve noticed that since the Double Fine Adventure Kickstarter campaign, the crowd funding platform has gained a lot of momentum in the games industry.

New success stories emerge regularly, and there are now 10 games successfully funded that way beyond $500,000. Not a small feat!

We’ve been working on a Kickstarter project with a client, and as this progressed I grew very concerned that the popular perception of Kickstarter = success is not complete, and that anyone thinking of funding their project this way should look at it very closely before going there and asking for hundreds of thousands of dollars. There aren’t a lot of data points to check, so we decided to do some research to understand the platform and its current capacity better.

First off, I should say that our methodology limited our data. We had to draw a line on the size of the projects we looked at, and we don’t have any data on the ones that failed  (and that’s a real shame, as I believe this is the key information when you want to decide whether or not you should give this a shot). What we have is a snapshot of successful projects, but even this is quite helpful.

For instance, if you are trying to raise $250,000 for a PC game, you are trying to raise more money than the average PC game manages (that’s $233k). More importantly, you are trying to raise more than 10 times the median amount of money ($23k). Your project will need to be exceptionally attractive to pull this off.

Appblogger.com recently published a very useful infographic about Kickstarter. They used a scraper to get the data rather than collecting it manually (as we did), and I highly recommend checking it out: http://www.appsblogger.com/kickstarter-infographic/.

From their numbers, we can extrapolate that our data sample is missing about 656 games projects that are below the $10,000 mark. That’s a large number, and it would be nice to look more closely at those, but from a practical point of view we are not likely to work on any project of that scale.

We are likely to see a significant drop at some point when bad stories happen (and they are bound to happen) however, Kickstarter is generally set up to be a very nice way to finance small to mid-size indie games.

It is also clear that at the moment it favours PC as a platform and RPGs and adventure games. All good things to take into account if you are seriously considering putting your game out there and you want to make sure you set the right objectives for it.

Please let me know your thoughts and comments, especially if you find any errors in the thought process or the data.

Tablet market in Europe

I was asked recently by a friend if I had some numbers about the tablet market in Europe, so I thought I could as well write a blog post about it.

To make it short : Yes, the tablet market is growing in Europe. According to market research institute Canalys, shipments are up 180% yoy to 4.7 million in EMEA. Nonetheless, the growth has been much slower than in the US and Asia Pacific. The research points difficult economic conditions in Europe (according to Gartner, PC shipments declined too), and the lack of content compared to the US (less localised services, such as Netflix & Hulu, and less local(ised) content on Apple, Google and Amazon).

I’ve made a quick chart to summarise the shipments :

Canalys-tablet-shipments-europe-q1-12

Examining public data from IDC and Gartner that I have seen so far seem to place the total EMEA tablet shipments to date at the end of Q1 2012 to about 30 million, which should amount to an installed base of around 25 million. That seems to be confirmed by this report from Futuresource Consulting, which pins the installed base for tablets to 18 million in Europe at the end of 2011 (a bit less than half the US number at 37 million.)

Regarding individual countries’ installed bases, I was able to find the following data :

tablet-eu-bases

A bit more info about the tablet market in Europe, Amazon’s Kindle Fire is not available on the Old Continent yet. According to Comscore, the OS breakdown is as follows :

tablet-os

Regarding demographics, tablet owners in Europe are mostly male (62%), in greater proportion than smartphone owners. 42% are aged 25-44.

tablet-eu-demo

In terms of income range, most of the tablet owners have revenues comprised between 20 and 40k€ yearly, which shows that the devices are not reserved for the high incomes, although they remained a bit more skewed towards high incomes than the smartphones:

tablet-eu-income

In terms of cross-platform ownership, Spain is ahead, followed by France, UK and Italy :

tablet-smartphone-eu