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A vicious dragon is out there... Assemble your party at the tavern... Slay the dragon! Grab the treasure! OH GLORIOUS GLORY!!!
A vicious dragon is out there... Assemble your party at the tavern... Slay the dragon! Grab the treasure! OH GLORIOUS GLORY!!!
A vicious dragon is out there... Assemble your party at the tavern... Slay the dragon! Grab the treasure! OH GLORIOUS GLORY!!!
10,877 backers pledged $250,070 to help bring this project to life.

Behind The Curtain: Finances Of Dungeon Roll

I know that many can be interested in where all of the money goes, and how we might be able to afford $15 including delivery and so forth.  So, I will bring you behind the curtain.

This reveal was inspired by my podcast interview for Funding The Dream with Richard Bliss.  That link heads to the podcast, it is a good 22 minutes.

But before we get into that, I would like to explain my motivations behind this project structure.  And these motivations are based on one super solid fact...  Namely, that I believe Dungeon Roll could be gigantic huge.  As a matter of fact, it is likely that all revenues related to Dungeon Roll will be supporting Dungeon Roll until we have sold at least 30,000 copies!

The Motivations

  • To create an exceptionally popular product.
  • To get Dungeon Roll in the hands of and played by as many people as possible.
  • To give Kickstarter backers as much content as possible.

Now, the extent to which this can be done depends on the finances, starting with:

Adjusted Revenue Per Backer

I was having lunch with a friend of mine, Patrick Nickell from Crash Games, who has published some cool games with crowdfunding through Kickstarter.  Well, anyways, I showed him my calculations to determine what funding level I should set, and what funding levels I should target.

It was like something unlocked in his mind, he never considered a project this way.

And it all starts with the adjusted revenue per backer, where the adjustments are:

  • Kickstarter Fees
  • Amazon Processing Fees
  • Delivery Fees (shipping from the warehouse to the backer)  NOTE: I price non-USA shipping to be as close to the actual increase as possible including KS and Amazon fees, so this is really meant to be per backer or per copy.
  • Royalties
  • Damage and lost package adjustments

This adjustment represents how much money per copy I have to be able to spend on everything else, manufacturing, setup costs, ocean freight, additional inventory, and if I wanted to keep any money personally.  Maybe I should set aside $40 to treat my wife to a nice dinner to celebrate?

So, the costs are:

  • $1.50 for the Kickstarter and Amazon fees (with the low dollar amount the Amazon fee works out to about 5% as well)
  • $6.25 to deliver the games based on fulfillment by Amazon prices
  • $0.60 for royalties per copy

That means that I have an adjusted revenue per copy of $6.65.  This is what is used to manufacture, ship, cover setup costs, dinner with my wife, and so forth.

Viewing As Aggregated Costs Or Cost Items

Now, to make my life and calculations easier, I view all of the other costs as individual line items.  For example, I will look at the setup costs and how many backers I need to cover it. 

Then the manufacturing, and how many I need at different funding levels, since with more units the marginal cost per unit goes down.  But with these costs, as the unit cost goes down, I see this as a good place where I can then increase the cost by providing more stuff.  So, if the cost per unit goes down by $0.02, then I can add another hero card for example.

The most interesting item is shipping.  I estimate a cost of $4,000 for a 20' container and $6,000 for a 40' container.  Up to 10,000 units would certainly fit in a 20' container.

Costs And Backers Required To Cover Them

So, with setup costs (art, dice molds, plates, etc) of $8,300, will be covered by 1,248 backers.

Ocean Freight at $4,000 will be covered by 601 backers.

So, I now know that I need to have 1,849 backers to be able to cover my setup costs and assumed ocean freight.  Thankfully, the per unit manufacturing cost is pretty attractive, and will be determined by the final product, but at 10,000 units, lets assume that is $2.40 each.

So, manufacturing 10,000 units would cost $24,000 and would be covered by 3,750 backers.  So, I would need to have approximately, 5,599 backers to be able to make 10,000 copies with no out-of-pocket costs.

That is $83,985 of funding so that I would be able to have about 4,400 copies to sell that is completely crowdfunded.

Are You Crazy?

Maybe

But I believe in Dungeon Roll 100%. I would say, 150% I believe in it, but I know that math is wrong.

I also believe in the backers that we would attract for Dungeon Roll and that they would be happy to share with their friends and would strive to get us through these additional stretch rewards.

I also believe that being generous will be rewarded.

That Dungeon Roll could gain the support through Kickstarter that would be required to make the game so that all of this is true:

  • It has TMG production quality standards. We have published well over a dozen games and consider this extremely important.
  • Have a mass market type of price point which is typically obtained through very high print runs in the tens of thousands. 
  • Can be supported with additional content and expansions, like different types of dice, more heroes, epic items, more monsters, different types of dragons, campaign play, and so forth. 
  • MOST IMPORTANTLY: Has game play and replayability that TMG can be proud of, and we are. 

Conclusion

I know that was a ton of information, but I hope it sheds some light on the thought process, the commitment, the goals, and how important each and every backer is to achieving those goals.

There is no way that I could ever reach and convince 5,000 backers myself.  Maybe I could garner 1,500 backers early through extreme effort.  But at some point, it really does require the promotional help of those involved.

With that said, if you can help promote the project, great thanks!

Cheers,

Michael

Comments

    1. Ted Stewart on March 9, 2013

      Can we expect a Canadian combo pack as well? :-p

    2. Dale Hall on February 28, 2013

      Not only does the game look like a ton of fun but the updates are educational as well!!

      Thanks for the insight.

    3. Michael Mindes 28-time Creator on February 28, 2013

      @michael - Yes, but you can start now. I just happened to start 3+ years ago and have been working at it every day almost.

      @brian - My pleasure as always.

    4. Brian Frahm (@frahminator) on February 28, 2013

      Always impressed by your level of transparency. It is an educational benefit to not only your backers, but to the hobby at large. Well done.

    5. Michael King on February 28, 2013

      The old "how do I get the audience without a project and how do I fund a project without an audience" conundrum. I know what you mean though. Once I saw this project was TMG, I had no problem backing it. Your products thus far have been top notch. Thanks for the advice.

    6. Michael Mindes 28-time Creator on February 28, 2013

      Game Design, Game Development, Artwork, that is the only thing that I have paid royalties on thus far in my career as a game publisher.

      I choose to pay royalties so people have a reason to do their best work.

    7. Michael on February 28, 2013

      If you don't mind my asking, what do you have to pay royalties on for this product? Just curious.

    8. Michael Mindes 28-time Creator on February 28, 2013

      @Michael - Nobody should dare to do this unless they have confidence in their existing audience.

    9. Michael King on February 28, 2013

      Thanks for the details. I'd eventually like to try my hand at a kickstarter project and seeing this breakdown is a great block of pricing information.

    10. Michael Mindes 28-time Creator on February 28, 2013

      @Sam - My pleasure. We should catch up at a convention and discuss such things in person my friend.

    11. Sam Brown on February 28, 2013

      Great to see behind the curtain, and to have a glimpse of how you think about the business realities and goals.

    12. Michael Mindes 28-time Creator on February 28, 2013

      @Julia - I will take her to dinner either way. We are already off to a great start. We have some gift cards for restaurants from my parents still left from Christmas. ;)

    13. Michael Mindes 28-time Creator on February 28, 2013

      @Scott - We will do it with Dungeon Roll and it will be full of AWESOME!

    14. Julia Gosztyla Ziobro
      Superbacker
      on February 28, 2013

      This transparency is one of the things that makes great projects from TMG and others great. I don't know if we'll make $90k but we are off to a fantastic start. I really appreciate the honesty, and will do all I can to get this project to fly off the crazy-popular chart!

      If we don't make $90k, I want to send you $5 extra to help you take your wife to dinner. You both work really hard to make TMG happen, and if a dinner is ALL you get out of it, that's just wrong. I'll bump my pledge the last day if we don't get to that goal. :-)

    15. Scott Wise on February 28, 2013

      Very cool. I appreciate you shedding some light on how the math works out and why it can be hard to get really great games to market. Keep up the good work!

    16. Michael Mindes 28-time Creator on February 28, 2013

      @hair10 - anytime.

    17. Michael Mindes 28-time Creator on February 28, 2013

      @Kevin - Thanks. I wanted to keep everything as simple as possible so as to avoid losing people. Which with a long post like that with lots of numbers, it is easy to gloss over.

    18. Michael Mindes 28-time Creator on February 28, 2013

      @Matt - I will need your help!

    19. hair10
      Superbacker
      on February 28, 2013

      Nice break down. Thanks for the peek behind the curtain.

    20. KevinR
      Superbacker
      on February 28, 2013

      Note that "5,599 backers = $83,985 funding" assumes $15 per copy. Because of Kickstarter's crazy accounting, international shipping is included in the total they report. Based on current ratios, about 10% of backers are Canadian and 10% are international, which will add $4000 of Canadian shipping and $7000 of international. So, to support the 10,000 unit run the Kickstarter total really needs to reach about $95,000 and 5600 backers.
      (I'm sure that Michael understands this, but people who haven't watched enough projects might be confused.)

    21. Matt Miller on February 28, 2013

      @Michael,
      Thank you for the interesting behind the scenes and the transparency. It's a lofty goal but still so early. Congrats on funding and good luck getting to your ultimate goal!