When Kickstarter goes wrong

Ever wondered what happens when someone doesn't come through on a Kickstarter pledge? Warbird Games has found out the hard way.

It was a good day for Warbird Games. Its Kickstarter for Jack Houston and the Necronauts, a point-and-click adventure game made entirely in retro sci-fi stop-motion, topped its funding goal by over US$8000, topping out at US$64,256.

But one crucial backer didn't come through — with a pledge of US$10,000, it pushed the game back under its funding goal.

Lead designer Stacy Davidson said that, "After the exhilaration of passing our goal by almost US$10,000, I was expecting to spend the next few days getting ready to start production on the project. Instead, I spent them frantically trying to find out what was going on with the donation, whether we'd even get the other funds, and glued to email for any news."

With every Kickstarter, a few unfulfilled pledges is only to be expected; and, although backers are discouraged from cancelling, that option is available. However, that isn't what happened here — when the time came for funds to be collected, the US$10,000 backer's credit card was declined.

Usually, when a Kickstarter project doesn't meet its funding goal, all monies go back to the backers and the project either dies or seeks an alternative. Warbird got lucky: due to the fact that the Kickstarter did, technically, succeed and that the funds were so close to the target, even without the US$10,000, Kickstarter allowed the studio to keep its funds on the proviso that the project does actually go ahead.

It has put Warbird in a tricky position: the studio is obligated to make the game without the funding that it required. It has opened up donations via PayPal on its website, with the same reward tiers as offered on Kickstarter — and has now announced that it will be bringing the game to iPad, Android and Mac, as well as PC and Linux.

It also raises the question, though, of what does happen when Kickstarter goes wrong — considering that there are several points along the process where it can?

We already know that if a Kickstarter project doesn't reach its full funding, then no harm, no foul; no money gets deducted from buyers' accounts, and the project either dies or goes off to seek other ways of getting off the ground.

But, say funding does go through — and the project, for some reason or another, doesn't deliver what was promised? It's not unheard of. Take, for example, the i+Case for iPhone 4, an aluminium bumper that — oops! — just so happens to kill the reception signal to the phone. Or the Pebble watch, which was so hugely popular that the designers have been yet unable to meet demand. Or the Pen Type-A that ran into manufacturing issues. The web is full of stories like these and of disgruntled customers.

According to Kickstarter — and this should be no surprise — the risks are all borne by the project designers and the backers; firstly, the designer has to take the risk that customers will like the project enough to see it fully funded; and secondly, the backer takes a risk when supplying funding that the project will go ahead.

Although Kickstarter states in its terms and conditions that creators are obligated to either follow through on the project or issue refunds, there seems to be no penalty if either of these conditions are not met. But the fact of the matter is that, without an element of risk, Kickstarter simply would not be what it is.

Kickstarter made a post to its blog early this morning to address these issues, saying:

The pursuit of these projects with a guarantee, doesn't work. A Kickstarter, where every project is guaranteed, would be the same safe bets and retreads we see everywhere else. The fact that Kickstarter allows creators to take risks and attempt to create something ambitious is a feature, not a bug.

And that's exactly what we love about Kickstarter. However, for both creators and buyers, it's imperative to enter Kickstarter with both eyes open. It's not a sure bet, and Kickstarter itself makes no guarantees that it will help out if things fall through. It's all on the people; and, to be honest, it probably wouldn't work any other way.