Problems with Kickstarter

[hazofhorsham]

Hey guys,
I thought there should be a topic for designers that want to get their decks made, and don't know too much about the flaws/issues they may hit. Whilst I haven't completed a project on Kickstarter, I've done extensive research and back a few projects. On top of this we have plenty of members that have experience (Alex, Paul, etc) or very knowledgable ones (Don, etc).

So hopefully this helps for new comers.

The first thing to note is that Kickstarter costs... A lot. After kickstarter and Amazon take their cuts you are looking at 90% of what is pledged. What does this mean? Say you list a deck as $10, you'll lost $1 to amazon and kickstarter - if your margins are tight, be careful.

You really have to sell. Some of the most successful projects have been from those that are present in the forums. If people interact with you, and you are selling yourself as well as the project, more people will jump on.

Momentum, once a project starts to gather momentum things seem to take care of themselves, the hard bit is getting it up and going.

Your goal. When setting your goal beware that you really have to reach it, but it also has to cover your costs. There is no point having a $10,000 goal, reaching it and then defaulting. From what I've seen, I'd recommend $17,000-$20,000.

Shipping. This is a major gripe of mine, but I'll try to stay neutral. Most american based designers offer free domestic shipping. Be warned if you offer this, you will be hit hard. But it is something people expect. What most seem to do is exploit the international shipping because aside from a pledge level on the galvanic playing cards, no one offers free international - that'd be suicidal. What I will add though is that if your international is too high people just won't pledge. For example, a recent deck had $8 price, $7 shipping. A) Do I value the deck at $15? B) Can I justify the price of the deck in shipping? The answer is normally, wait until the aftermarket. Because I will probably be able to pick it up from a reseller for about $10, and pay only a couple dollars shipping (I usually buy a brick or more from resellers of all the new cards that year. One time I bought 50 decks from BMPoker, this makes shipping literally a dollar). Does this matter? If you're circle city cards, no. If you are new and fledgling and need every backer you can get, don't alienate people. I for one would rather a higher deck price and cheaper shipping - for some weird reason $10 deck, $5 shipping would get me.

State and distributer tax - dependant on what state you are in, you may be liable for certain taxes, and so you should look into getting what I believe is called a sellers certificate. I am not american so I don't know the proper terms; any help Don?

Extras - Some popular kickstarters have had extras, CCC had dice and brick boxes, Tendril had card clips, nearly all have uncuts. Read around, and do some polls on what people think will suite your deck. Maybe a t-shirt? or some stickers. It depends upon your deck, for example the tendril clips looked amazing (Still waiting for one though) and so did the deck, and so protection was a good idea. Cosmo's spectrum deck needed uncuts to do justice to it. It's all relative to your design.

Anything I missed?

[Don Boyer]

Hey, Haz, were you planning to release a deck soon? 

The most important thing any potential KS project creator needs, before even starting the project, is knowing as close as is humanly possible what every little thing is going to cost.  Paul knows this - he's written of his spreadsheet prowess before.  I did it in my consulting work for clients looking to launch on Kickstarter, in terms of knowing what not just the item being created will cost - the deck - but all those wonderful little rewards as well.  Once you know what it will cost, you can deduce from there where to place it in terms of reward tiers.

Yes, KS gets a cut.
Yes, Amazon gets a cut.
Yes, the Internal Revenue Service gets a cut, at least in the US.  When they get wind of it, so do the states and municipalities that charge income tax as well.

Your flat dollar figures of $17,000-20,000 leave out an important detail or two - namely, who's going to print your deck and how many are you making.  It's entirely feasible to make a deck with a modest quantity of 2,500 with USPC and have a goal under $10,000.  Tax-wise, you're probably better off that way.  And as some people are starting to learn, there are other printers in this great, big world of ours that make decks at least as good as, if not better than, USPC without charging as much as USPC does.  Keep your eyes open for Lawrence Sullivan's Legends decks when CARC starts selling them next month - they're NOT made in Erlanger, KY, USA!

You will NOT get clobbered on domestic shipping, if you properly factor in shipping costs when you make that spreadsheet I mentioned above.  You simply have to know what things cost to ship, right down to the last reward.  And yes, it costs more to ship out of the country - I have yet to find a country where this isn't the case.  If it's out there, I certainly don't live in it, I can tell you that...  The toughest part about managing international shipments is that, unlike domestic shipping, every single blasted package has to have a Customs Declaration Form to go with it, individually addressed and with all the contents listed.  Pain in the tuchass.

What makes buying any KS deck through the project more appealing than waiting for the aftermarket is 1) you usually get KS decks at below the retail price and 2) without your support at the KS-project level, there will be no deck, so no aftermarket!

On the topic of the "early bird" offers, people have gotten wise and created projects where the early bird offers are limited to a single deck.  In some cases, people got the early bird at insanely low prices and ordered huge amounts - that's where some costs can hurt you, depending on how attractively you price the early bird.  So these days, it's structured more for people who want to get a deck but otherwise wouldn't be able to afford it and are willing to leap in there quickly at the start of your project to give it a healthy boost in the early stages to attract attention.

Pick and choose your extras wisely.  While some projects had just the right selection, some started to look more and more like a flea market rather than a deck project!  I'm waiting to see branded blenders, boy shorts and condoms to come out for someone's deck eventually...  Not every deck needs poker chips - honestly, how many sets of poker chips does a single person need?  A dealer button, perhaps, but a full (and usually expensive) set?  T-shirts, yes.  Art prints, perhaps.  Uncut sheets are practically a must, though if you ask me, sooner or later you're going to run out of room for all that stuff on your walls!  And if you call it an "art print", make it a REAL art print, and not something you cranked out on the inkjet printer on office paper and folded up to stuff in with the decks!  Art books, though usually very limited, are popular, especially if it's for a company that's in the business of making decks, but the art better justify it or save yourself the trouble.

I'll leave the more experienced out there to talk from experience - my experience is limited to just the consulting I've done for others, having never done a deck project of my own.  There's more I could discuss, but I do get paid for this kind of stuff, y'know... 

[hazofhorsham]

I may have something It's seeming to take forever though :L

I should have stated that the 17-20K was for a 5K run, and aside from that I think we have everything covered.

Thanks Don, anyone else have an input?

[xela]

I want to throw in a few pieces of info:

How much you get: You're looking at about 10% Amazon/KS fees, 10-15% in declined cards, and 20+% in taxes. Prepare your goals accordingly. Kickstarter is an awesome place if you want to start a business. It's a terrible place if you want to make a fair income. You have to surpass your funding goal by an excess of 50% sometimes to make any profit.

Shipping domestically: Just make it free of charge and put in the shipping costs into the deck price. For example if you originally wanted to sell for $6 per deck, sell for $7-8. You will most likely be losing money for every one deck pledge you get, since if you charge $10, $3 goes to USPCC, 2$ goes to fees and declined cards, $2 go to taxes, and $3 go to shipping. You will be making 99.99% of your funding goal through higher pledge levels. Looking back, I would have taken off a one-deck pledge level, and a two deck international entirely. This may not be an option anymore because KS doesn't let you sell more than 10 of the same item per pledge level.

Shipping internationally: Unfortunately what many people do not understand is that there is literally no reason to sell to international customers anything less than 3 decks. 1-2 decks are a profit loss if you don't charge properly for shipping. Just one deck costs somewhere around $8 to ship anywhere in the world. People demand that KS creators discount international shipping, but why? There is literally no incentive to do so. Mark up your international shipping for the low-tier rewards. I recommend $4-5 for one deck, and the full $8 charge for two decks. Do not do what I did and charge a flat $8 shipping across all pledge levels. As a result, I lost an upwards of $200 for the big pledges just on shipping. I discounted things so much originally because I thought international customers wouldn't pledge if shipping costs were high. I was dead wrong. Turns out these guys are used to being shafted by big companies like Ellusionist, so charging them $50 to ship 72 decks is not a big deal.

Resellers: Literally all my funding came from these guys. Not just the ones that bought several gross, but the small time resellers as well that bought 24+ decks. "Ship these guys out first and laugh at anyone that complains" (word for word what another KS creator told me). Resellers made the project happen, they bought the most decks, it makes the most logistical sense to get rid of your big orders first, and your big shipping costs will be spent on these guys, so you will get a big idea of how to manage your money.

International vs. Domestic numbers As a result of skyrocketing my shipping rates for for 1-2 decks, I got almost zero international buyers in those pledge levels. Good. Less customs forms = less man power. The <$20 pledge levels were like 5% of my funding or something, so let's say I did free international shipping. Well then I would have made a few thousand more dollars, but 100% of that money would be spent, with no profit being made.

Don't sell to resellers that try to lowball you: If you are selling a deck at $9-10, you shouldn't accept less than $5 per deck from resellers. Some may cry about it, boohoo. Most will give you what you ask for, and you're here to run a business and make money, not do charity work. A few of the resellers that tried to lowball me ended up buying decks from other people and selling my cards in small quantities anyway, so I wasn't worried about exposure. I think only one seller I did negotiations with didn't end up stocking my deck, and that's the guy who offered $3 per deck.

Set aside time for shipping, logistics, and customer support: All three of these things can really mess with your life if you, like me, are not prepared for it. You have two options: quit your job, quit your school, and spend several months dealing with this, or do the research on this stuff. Shipping and logistics info is widely available now, which it wasn't when I did my deck (when I launched my project, I think only one KS backer at the time received their cards, maybe two, with smaller runs than mine).

Reseller's permit: For the love of god get one. If you don't, USPCC will charge sales tax on your $15,000 purchase, and you will kill yourself. It took me like $30 to make one online for NV from a third party site. Some states even have it on their own .gov sites, letting you avoid fees all-together. Just do it, man.

Fictitious Name: You don't need a business license, but you may need a fictitious name for your bank account. I got several checks addressed to "Aether Cards" and had no idea what to do with them for a while. If you go beyond KS, you will need a business license as well in most states.

That's all i have for now.

[sprouts1115]

wow alex that was a good post.

This is a recent replay from tiffany from USPCC.

Hi Russell,
Our options and pricing guide should help you out with these questions.  Thanks!

Air-cushion, magic and linen finish etc are all versions of embossed.  Different people use the different names as marketing techniques.  We use pantone metallics, you can use up to 6 inks of metallic/non metallic inks.



Thanks,
Tiffany Mahan


this is the pricing guide that i can not find on their website.  if you make cards they have to be from USPCC for the best quality,   this is not a quote from them for my cards.  just wondering if this will be deleted if i post this.  note: the price guide is old and may be higher and will be different for each designer.  i just wanted to share this for people who are thinking of making cards.

Options & Pricing as of 01/01/12*

Base Deck Price: This is before adding any options and prior to us viewing the artwork.  Artwork can change the cost of the deck if it is a difficult print with a high scrap rate.  This price is given to you on your custom quote.

Branded Custom decks:  For use of our branded names (Bicycle, Bee, Tally-Ho etc) branded pricing is required.  These prices include magic finish if requested.  Brand name can be listed on the tuck box but the card back design can be unique.  All custom branded artwork needs to be approved by the Brand manager before we are allowed to print. 

2,500 – 5,000 $2.72
5,000 – 7,499 $2.54
7,500 -  9,999 $2.37
10,000 – 14,999 $2.10
15,000 – 49,999 $1.71

Paper: Aristocrat and Bicycle paper are given as the standard with no additional charge.  Bee paper is $0.08 more per deck.  Please note that if Bee paper is requested an additional 4 weeks will be needed as the tucks are a different size and ordered from an outside vendor. 5,000 decks is also the minimum quantity for Bee paper.

Finish: Smooth and Embossed finish are available at no extra charge. 

Seals: USPC black seal is standard.  We can order custom seals when artwork for a custom seal is submitted.  Typical price is $0.10 per seal but depending on ink selection etc. it can be higher.  Foil seals are not doable. The impressor’s laser eye will not read them.


Inks: We use Pantone color inks and metallic inks.  The charge for metallic ink is $0.05 per metallic ink per deck.  Custom inks will be an additional price on a case per case basis.  More than 4 color inks will be an additional $0.04 per ink added to the deck price.

Custom Tucks from our Tuck vendor:  Price will vary depending on artwork, embossing/debossing, foil, quantity etc.  Once we have the artwork we can get a quote from the vendor.

Gilding: Gold and Silver foil gilding is available.  The base price for a custom deck with gilding is $4.60 per deck for 2,500 decks.  The paper for the deck has to be Aristocrat 300 and a special finish is necessary.  The artwork has to have a white border.  Extra time is needed for the gilding process, amount of time necessary depends on order quantity.

and by the way she is nice to talk to on the phone.

[Don Boyer]

if you make cards they have to be from USPCC for the best quality,   this is not a quote from them for my cards.  just wondering if this will be deleted if i post this.

Why would we delete that?  Deleting posts is a RARE event.

I will point out, however, that you might change your mind when you see the Legends deck, the current print run of Pr1me decks, the REN deck and any deck from Misdirection's Mystery (MSM).

[Frost]

can you do a website funding instead of a kickstarter funding ?

[Don Boyer]

can you do a website funding instead of a kickstarter funding ?

The issue there is attracting an audience to come and see your page.  Kickstarter has a built-in audience of millions of people.  Have YOU ever made a page that got that many hits?    I don't even think Google ads would be enough to help you there.

It's one thing if you're someone BIG that everyone both inside and outside of the community knows, like Criss Angel, David Copperfield, David Blaine - that kind of BIG is enough to draw people to your web page and get you exposure on TV maybe even without needing to take out ads, if you were inclined to do so.  I remember seeing ads for the "Mindfreak" magic kit on TV a while back.  But if you aren't even close to that big, your audience is way more limited and you're stuck with a strong chance of hit-or-miss.

BeDeceived was one company that tried to do it alone on their own site.  They managed to produce three decks, wristbands, gaffed USB drives and a fair amount of debt.  The Mystery deck was full-on gorgeous, but it wasn't enough to get Collin out of the red and into the black.  He's put his Confidence deck out as a Kickstarter project to get it made and pay off what he owes.  Once that's done, BeDeceived is a done deal, shuttered, though Collin has expressed interest in using his graphic design company, PeachCrate, to design decks for other companies.

I'm not saying it's impossible.  I am saying that it's not easy, whereas on Kickstarter you can get a great deal of exposure to people inclined to invest for rewards.

[alvinhy]

I think what BeDeceived did wrong is that they jumped the step in making a brand with no fundamental foundation. If they first created the project on kickstarter then use the exposure and the contacts they make to create the brand they might be able to succeed.