Setting a Reasonable Campaign Funding Goal
A budgeting and marketing puzzle for any crowdfunding campaign is determining the funding goal. Today’s article is a back-and-forth dialogue on this subject between Ira Fay (Far Off Games) and me (Jamey, Stonemaier Games).
***IRA***
The first printing of Arydia: The Paths We Dare Tread had a successful Kickstarter campaign by any reasonable measure (10K+ backers, $1.3MM raised), but the Kickstarter algorithm did not highlight it as “project we love” or anything like that. We can’t know for sure why not, but Cody and I have a hypothesis: The time it took to reach the funding goal was too slow (2.5 days!) and the ratio of funds relative to the funding goal was too small (less than double).

Cody set the goal for the first campaign at a whopping $720,000 because that was the amount of money he calculated he would actually need to manufacture the game and fulfill all his commitments. It was a real number and it was scary big!
As we approached the second printing campaign, we had the opportunity to talk with various marketing and campaign advisors. One bit of advice we received was to set the threshold artificially low, far below what we actually would need to fulfill the project. In the worst case, the advisors said, we could simply cancel the campaign and refund the money. By having an artificially low funding goal, we please the algorithm while potential backers see that the project has funded and thus feel more confident backing.
As Cody and I discussed this advice, we felt uneasy. If the campaign goal isn’t the real goal and instead it’s just an imaginary number, the whole system loses credibility. Backers gain a false sense of what’s actually needed to manufacture games and fulfill projects. Publishers face unrealistic expectations, striving for practically instant funding. And when a campaign gets cancelled after reaching its artificially low funding goal, backers (who didn’t realize it was a false goal) are rightfully disappointed.
This idea of using artificially low thresholds to get engagement isn’t new. This appears in auctions with a reserve price. For example:
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Bidders might initially feel excited that they could get that car for $630, but to avoid disappointment, they must understand the fine print. There is a hidden reserve price that must be met before they actually get the car. At least in this auction situation, people are told explicitly about the hidden reserve!
We are running Arydia’s second printing campaign on Gamefound, and their website automatically shows how fast a project was funded. Here’s an example from unrelated campaigns:

To be clear, I don’t believe that either of the campaigns shown above are using artificially low thresholds – they are well-deserved, extremely successful campaigns! But one can easily see how the system is encouraging creators to keep thresholds low by reporting scores like this. If the system instead reported “percentage of satisfied backers” or “percentage of followers who actually backed” or “eco-friendly manufacturing score,” it would immediately incentivize different behaviors by publishers.
The current reality of crowdfunding is that the algorithm does reward projects that reach their goal quickly. It makes the project seem popular and successful. I understand the impulse, but at the same time, I don’t think it’s a trend that benefits backers or publishers in the long run. Hiding the realities of the project undercuts one of the big transparency benefits of crowdfunding.
This is a small issue relative to many other things discussed on Jamey’s excellent blog (environmental issues, tariffs, etc.). I hope by shining a light on this topic, everyone can see the algorithm’s influence on publisher behavior, and publishers can perhaps be encouraged to show accurate funding goals despite short-term incentives to the contrary.
***JAMEY***
Thanks for sharing this, Ira! I largely agree with the idea that creators and backers benefit from a funding goal that reflects the real amount needed to create and manufacture the game.
Where I’d push back a little is how that number is calculated. For example, if Arydia had only raised $700,000 instead of $720,000, would that truly have tanked the project? What about $650,000? And so on.
Let’s talk numbers for a hypothetical game. If you want to make a game with a landed cost of $20 (manufacturing plus freight shipping) with a trusted long-time producer like Panda, you’ll have a minimum order quantity of 1,500 units (or 2,000 if plastics are involved). Ideally you’ll make more, but that’s the bare minimum you need to cover that MOQ. So that’s $30,000.
Of course, you’ll need to pay artists, graphic designers, playtesters, and proofreaders–those costs can vary greatly based on the complexity of the game and the quantity of the art. At Stonemaier Games, I would say that those costs add up to around $75,000 on average. Added to the landed costs, that’s $105,000.
However, if we’re investing so much money, time, energy, and other resources, we’re not looking to make only 1,500 units of the game. Our real MOQ is 20,000 (i.e., if we don’t think we can sell at least 20,000 units of a game, we won’t make it). So that puts this hypothetical calculation at $475,000.
Now, if I were to use crowdfunding, would I use $475,000 as the goal? I would not. My reason is because it’s aspirational–just because I want to sell 20,000 units doesn’t mean the game isn’t feasible at 1,500 units. Also, I’m not a first-time creator, so I’m prepared (financially and otherwise) to bet on myself. Like you and other publishers, I’ve already done a lot of the work to create the game before I’ve presented it on a crowdfunding campaign. Essentially, I’ve already decided that the game is worth a certain amount of investment no matter what backers can provide. So if I’ve already spent $50,000 on artists, graphic designers, playtesters, and proofreaders, it isn’t my expectation that backers should reimburse me for that investment. That drops the goal down to $55,000.
My last thought is about transparency. I love your focus on transparency, though I don’t think it solely rests on the funding goal itself. In the hypothetical example above, I might list the funding goal at $55,000, but somewhere else on the project page I might discuss that I’ve already invested $50,000 in the game and that the additional $55,000 is for an MOQ of 1,500 units even though I’m really hoping to make at least 5,000 units.
I’m not claiming that any of this applies to Arydia specifically (in fact, I’m 100% sure that Arydia’s landing costs and sunk costs are significantly higher than the example I provided). Rather, I just wanted to point out that an accurate funding goal is relative to various factors and that transparency extends beyond the goal itself.
What do you think? Feel free to close out the article with anything else you want to counter or share.
***IRA***
Great thoughts! Here are three additional notes:
Previous Reading: Just in case current readers haven’t seen your previous article on this topic, I think many of your points are still totally relevant today: https://stonemaiergames.com/kickstarter-lesson-7-the-funding-goal
Drawing the Line: After doing all the math and calculations, let’s say we end up with a goal of $52,000. I can always ask myself, what about $51,999? Surely that would still be OK. What about $51,998? etc. It’s quite tricky to find where exactly to draw the line. One approach is to pick a number substantially lower, like $40,000, and convince yourself that it’s really too low. Then you can go up from $40,000 and down from $52,000 until you feel like you’ve found the lowest reasonable goal.
Stretch Pay: If you’re offering an expensive game, many backers may want to pay via installments, which Gamefound calls Stretch Pay. I don’t know the data across all of Gamefound, but to share a single data point (since I really appreciate how Jamey shares real data here): As of Day 1 of the Arydia reprint campaign while I’m writing this, 47% of pledged dollars are in the form of Stretch Pay! That means we won’t actually get the cash flow until much later in the process, after we’ve needed to make payments to the manufacturer. If you’re going to offer Stretch Pay, be sure to plan out the payment schedule to align with your manufacturing bills!
Thanks again for the opportunity to discuss this topic!
***JAMEY***
Thanks for sharing these thoughts, Ira! I wish you the best with the second-printing campaign (currently $476,408 raised for a $200,000 funding goal).
I’d love to hear what other backers and creators think about the funding goal calculation. Let us know in the comments below!
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