If you are like me, you are really excited about the news of a Pathfinder MMO. If you are even more like me, you quickly noticed the link up at the top of the Goblinworks page, and clicked on it to find this... https://goblinworks.com/investors/ - and probably don't have a spare $100,000 lying around to invest.
But certainly, players and fans will want to see this succeed?
So I had this idea... if fans can come together to make things like Wayfinder, what's to stop them from coming together for investment purposes?
Before I go further!!! Obviously, I'm not affiliated with Paizo - you'll note the lack of a golem by my name. Also not affiliated with Goblinworks. The news is, well, news to me. So I haven't had time to think out all the details. I don't even know if Goblinworks would be interested. I'm NOT selling anything. This is simply a hastily assembled idea to see who would be interested, both inside and outside the company.
I'm envisioning something like a mutual fund, designed solely for investment in Goblinworks. You sell shares in the fund at some low price, like $1 each, and any returns from the fund are divided up on a per share basis. This is investment, so you make it at your own risk.
So the questions I have for Goblinworks are, would you be in favor of a setup like this to allow your players to invest in your product? And are you looking for debt or equity financing - would we be looking at interest or dividends/capital gains?
For everyone else, is there any interest in a project like this?
Chief Technical Officer
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We might be amenable to that, and if somebody gets serious about organizing that, by all means drop an email to investors@goblinworks.com... but I kind of hope that by the time somebody would be able to line all of that up, we'll already have all the investors we're looking for!
I would definitely go in on that.
Especially if you worked it out so that purchasing a certain number of shares got you a free account, for instance. ;)
Edit: Does anyone know if Kickstarter would be a viable platform for this?
Goblin Squad Member
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Kickstarter is no good for this--they focus on creative projects rather than funding for an outside development effort. The structure discussed here is more akin to an investment club. In any case, you'd want to look into the tax ramifications for this arrangement--you'll need a good tax guy. If you truly want it to have that "single investor" face to Goblinworks, then you're looking at an LLP or something similar.
"Benefits" for the investment, from what I can tell, would be more akin to shares/dividends, etc. as Goblinworks is describing this as traditional venture capital investment. So, unlikely to net anyone free accounts, perks in the game, etc. as the individual investors wouldn't "exist" from Goblinworks' perspective. Rather, the investment would generate some sort of profit and that profit could then be split between investors. The influence this approach might have on the development would depend entirely on the capital generated to invest I'd assume, and again the group would only have one voice (albeit a bigger one with more money). As such, you could make arrangements such that each individual gets a vote or some such toward any recommendations to Goblinworks based on percentage of the total invested (again, this is based on no knowledge of how they plan to work the investor relations).
As Vic notes, your major challenge is likely going to be generating enough money to invest in time for Goblinworks to actually need the investment. Now, that's not saying you couldn't do some major promoting, come up with 1,000 people willing to invest $100 each in a month and you're in. It's just a long shot...
If going this route, in addition to the tax guy, you're going to want someone familiar with investing, some type of legal counsel, and someone with some accounting sense.
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I'm a tax guy - the securities regulation stuff is probably scarier than the tax. Selling shares in a company or trust units or partnership units in an investment to strangers is tricky. From a strictly Canadian standpoint, in order to sell to the general public you would need to do an IPO, which would cost more than the 100k you were seeking. In order to sell to a select group you would need to pitch to the exempt market (arguably sophisticated investors with lots of cash) for whom a 100k investment would not be worth their time. And again compliance costs would run you more than your 100k. I imagine the situation is similar down south.
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Chief Technical Officer
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If going this route, in addition to the tax guy, you're going to want someone familiar with investing, some type of legal counsel, and someone with some accounting sense.
This is good advice. Actually, I'd guess it's actually more in the realm of "probably going to be required before we even think about considering such an investment group."
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Goblin Squad Member
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I hate to burst everyone's bubble, but aggregating together a bunch of unaccredited investors won't make a single accredited investor. Having a single accredited investor is generally undesirable due to the increased disclosure requirements.
That said, if there are several accredited investors ($200K income for individual, $300k income for a couple, or $1m in assets, excluding your home), each of whom wants to invest less than $10k, setting up a vehicle for them to invest through is not that difficult.
So basically, government regulations on setting up investment groups prevent anybody but the rich from engaging in potentially lucrative investments? Funny, usually when I say regulation hurts the poor, keeps the rich propped up, and hinders new businesses, I'm speaking more abstractly...
Guess I'll go back to my stocks.
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Goblin Squad Member
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If that's upsetting, you don't want to dig much deeper into securities regulation. It's a game that's set up and rigged by big companies to make life harder on small companies. For example, back when large, publicly traded companies were using back-dated stock options, a number of new regulations were adopted, including one requiring small, privately held companies to have an expensive valuation done in connection with the issuance of options. This, despite the fact that the small, privately held companies were not the ones that were creating this particular problem (it's hard to game the price of your stock for a profit if you can't resell it).
Plus, there's Sarbanes-Oxley, which made it cost-prohibitive for smaller companies to go public. As a result, companies are forced to be acquired more often than not to achieve liquidity, which, again, favors the larger companies.
Anyway, this comes pretty close to a politics-type discussion, so I'll stop now, but securities regulation is one of those topics that are dreadfully, stupidly boring to the public (like banking regulations) and infested with corruption and anti-competitive provisions as a result.
Edit: Hmmm...rereading my original post in this thread, it looks like I left off a zero. It should say that anyone wanting to invest less than $100k could set up an investment vehicle.
Goblinworks Executive Founder
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I'm a go pester some of my local state congress people about stifling American small business. There are days it sucks being a moderate independent with a socialist streak.
What about t-sheets or other kinds of memorabilia? Or maybe an addictive little mini-game that's easier to make but could get things going. I'm always down for some kind of goblin related carnage.
Come on, Goblin Town (town not tower) defense (smart-phone?), protect Sandpoint from waves of goblins.
Or Goblin Assault, reverse tower defense, where you send waves of goblins at Sandpoint and get to buy different goblin units to send, like ones that fling snakes or fire or snakes on fire.
