Crowdfunding in video games

Video game development has typically been funded by large publishing companies or are alternatively paid for mostly by the developers themselves as independent titles. Other funding may come from government incentives or from private funding.

Crowdfunding, where the players of the video games pay to back the development efforts of a game, has become a popular means of finding alternate investment routes. As a way of game monetization, the use of crowdfunding in video games has had a history for several years prior to 2012, but was not seen as viable and limited to small-scale games. The crowdfunding mechanism for video games received significant attention in February 2012 due to the success of Double Fine Adventure (later renamed as Broken Age), a point-and-click adventure game which raised more than $3 million through the Kickstarter service, greatly exceeding the initial $400,000 request and becoming the highest funded project through Kickstarter at that time. A further boost to the model was seen in July 2012 when the Ouya, a low-cost video game console to be built on the open Android system and designed to take advantage of the mobile video game trend, surpassed $8 million in funding. By mid-2016, more than $186 million has been pledged to video game-related projects through Kickstarter alone.

Less than half of video game crowd-funded projects successfully raise their target funds.

Crowdfunding is a means to raise money for a project by eliciting funds from potential users of the completed project. While no third party is required for crowdfunding to occur, web sites like Kickstarter have been created to act as an intermediate in the process: they create space for project creators to share their project, provide ways for users to pledge their funds, and then supply the pledged funds to the creators for those projects that are successfully funded.

Projects using the Kickstarter model generally create multiple tiers of support. A minimum pledge assures that the funder will get the product in some form, but higher pledges will include additional benefits. In the case of video game-related works, this commonly can include being credited in the final work, receiving promotional items like T-shirts, obtaining early access to the game, or meeting the developers in person.

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