Now, here's a twister of an idea if I ever saw one!

In this article, Gabe Newell of Valve spits out one the most amazing ideas I've ever seen on the game biz side of things for a long time. On a nutshell:

"Lets Games Fund Development"

Yes, you read it! Let gamers fund development! This concept is huge and it certainly can open up a lot of unexplored territory even for the indie developer. The publisher was tradicionally the hub of producing financial efforts mainly because of the money backing they provide. If sudennly the dream of self-funding was provided by the gaming community by means of an investment product, then the product producing teams of tomorrow will be the open-source ventures of today.

Here's a snippet from his own words:

One of the areas that I am super interested in right now is how we can do financing from the community. So right now, what typically happens is you have this budget – it needs to be huge, it has to be $10m – $30m, and it has to be all available at the beginning of the project. There’s a huge amount of risk associated with those dollars and decisions have to be incredibly conservative.

What I think would be much better would be if the community could finance the games. In other words, ‘Hey, I really like this idea you have. I’ll be an early investor in that and, as a result, at a later point I may make a return on that product, but I’ll also get a copy of that game.’

So move financing from something that occurs between a publisher and a developer… Instead have it be something where funding is coming out of community for games and game concepts they really like.


Wow! Right?

The numbers are a bit odd to check, for a 30 Million budget like Newell says, assuming a general low-end-investing, if gamer-investors were to put in say $30 each, this means we will need 1.000.000 willing gamers to put their money on the project. Of course, for this to really succede I think we're talking more about actually investor-gamers than the other way around, we're talking about people willing to put in 1.000 to 5.000 or more. Only this kind of value can create the edge for those stellar-mega-budget Valve is going after. But you know what? I'm signing under that investment line tomorrow, how about you?

I can even imagine this working with a social site structure by which teams can post their project vision online, share it with the gamers and then chip in the financial efforts by investing on that team and that project. One thing that could be puzzling is how the money return policy would be handled but sites like eBay have used credit cards and buy-in protection for ages so this might be feasible on the long run. To actually enforce policies and for the ROI (Return On Investment) actually ending up on the hands of the social investors some kind of policy would have to be available, judging by human nature, perhaps the best option was for the social site to handle publishing as well, but that defeats a bit of the point of not having a publisher on the first place, but certainly on thing is clear, Gabe Newell has it with Steam and sites like BigFish and all the flash-web hubs out there will be dumb no to capitalize on this model since they already have the structure in place. So yeah, I'm giving this idea a thumbs up. I'm in for the Steam game fund. How about you?!

This is a clear, Win-Win idea for gamers and producers alike. Bravo Gabe Newell!

Please read the original article with video here.



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