The press are getting out the pitchforks, but the Gridiron Kickstarter may not be a scam
Gridiron Thunder is one of the first games to take advantage of OUYA’s Free the Games program, which offers matching funds to games on Kickstarter that raise over $50,000, and offer their game as a timed exclusive on the console. The game is being promoted by Kickstarter directly, and there have already been stories in the gaming media about the game’s crowdfunding success.
Underneath this success story has been some simmering doubt about the project, however, and the behavior of the backers of this particular Kickstarter doesn't make a bit of sense. Our tip line has been blowing up about an apparent “scam,” and I decided to make some calls.
Why this looks bad
The game has raised over $78,000 as the time of this writing, with only 125 backers. That means that, on average, backers gave the company $626 each. That’s an amazing result, and a large number of backers seem to have signed up for the service only to support this one Kickstarter. It makes no sense: How does a game come out of nowhere, attract a small number of donors with deep pockets, without those backers being interested in the rewards offered from the campaign?
I got in touch with Andrew Won, the CEO of MogoTXT, the company behind the Kickstarter. I told him that, according to these numbers, this is the most successful project in Kickstarter’s history, at least when you look at the high amount of money raised versus the low number of total backers.
“I didn’t know that,” he responded.
This behavior, of a low number of backers offering large amounts of money without signing up for the high level rewards, is very odd. “Okay, I don’t know anything about… this is our first Kickstarter. I’ll take you at your word. What kind of questions can I answer for you?” he responded. I told him this behavior looks sketchy.
“It does? Okay. If you tell me it does.”
He had to have some idea about what was fueling this behavior in the backers, what's going on?
“Our company, some background, we’ve got pretty deep roots in Silicon Valley. I’ve been a Silicon Valley lawyer before I took over the company for 20 plus years, working at some of the larger firms in Palo Alto,” Won said.
“A lot of the guys who work with me are former EA folks, Kixeye, so forth. So part of that is we have friends who know our company and know what we’re trying to do to build it into a successful business,” he continued. “And as friends do, they make donations. I think that’s part of it.”
The other aspect of the business is that they’re friends with many people who are prominent in the sports world. “I don’t spend my day begging for money or anything like that, but some of them know what we’re trying to do and they probably backed the project as well.”
In fact, Won said that working with athletes is a large part of their business. “We have a license relationship with a lot of professional athletes where they give us their name and likeness rights to be used in games and other products,” he said. “We also have a longstanding license agreement with the NFL Players Association, and we have rights under that. I’m sure I’m missing something, we enter into contracts just about every day.”
So if they have solid Silicon Valley contacts, those in sports who are happy to support their efforts, why Kickstarter?
“We saw it as an interesting opportunity to raise some money, and to attain matching funds. I don’t think there’s anything that precluded us from doing that. We were thinking about building this game, and of course we learned about the Free the Games program, so we decided let’s do it under that. I don’t think we violated any rules,” he explained.
“We’re pretty careful about what we do in every respect. We looked at how Kickstarter works and what Kickstarter’s rules and guidelines are, and also what the rules are for the Free the Games thing, it’s just part of our DNA as a company, we always operate to make sure we’re in compliance, just as we wouldn’t infringe on someone else’s proprietary IP rights, we wouldn’t do something that violates a rule,” Won stated.
He’s heard the rumors, that they’re not going to make the game, or take the money and run, or that EA owns rights that will keep the game from being released. Won brushed them off.
“I don’t know the identities of these people, but to make broad, sweeping statements like that, without actually knowing what the circumstance was, I’ve been a practicing lawyer for 26 years, working with some of the top law firms in Palo Alto, there’s no point in spending money on building a game if you can’t release it because you don’t have the IP rights. That’s just stupid. We’re not stupid people.”
I spoke with OUYA to see what protections are in place in case any of these Kickstarters end up being fraudulent.
The matching funds are paid out in increments, and are dependent on several milestones. 25 percent of the money will be paid when the campaign ends, with the next chunk of 50 percent only paid out when the game is approved and is commercially available on the console. The last 25 percent will be paid out when the exclusivity period ends.
So, at the very least, no company will see the majority of their backing funds under this promotion without releasing the game; there is no way to “take the money and run,” and 75 percent of the money will only be paid out once the game is done and released, making it all but useless for funding the actual creation of the game.
“We’re not scamming anyone, we’re not ripping anyone off,” Won said. But he’s read some of the feedback, and accusations.
“I’m just bewildered by the criticisms, I’m bewildered by the cynicism and the lack of trust. Why people believe in a sense of an online community if there’s not going to be a sense of trust,” he said.
He asked multiple times if he had answered all my questions, and then gave me one final takeaway. “What I hope comes across is that we’re sincere about this. We’re really trying to build an awesome title,” he said.
Where this leaves things
The behavior still looks very odd, and it's smart to be skeptical of crowd sourced games in general, but it's hard to prove that that anything unethical is taking place.
Wealthy friends may be signing up to back the project without asking for rewards, and the OUYA matching funds only pays 25 percent when the campaign has ended. The other 75 percent won't be paid until the game is finished, with a quarter of the money being held until the game has been released and runs down the timed exclusivity. Regardless of how this looks, the game must be finished for OUYA to pay out the matching funds.
If anyone is scamming OUYA to get these matching funds, it's a long con. The game has been funded, it's being used for positive PR by OUYA, and the Internet will likely remain skeptical about Won's claims until the game is released.