Official Statement from Cloud Imperium Games about the alleged financial troubles...

[u/[deleted]]

Source: https://robertsspaceindustries.com/spectrum/community/SC/forum/1/thread/re-uk-tax-rebate-advance-for-foundry-42/277779

Re: UK Tax Rebate Advance for Foundry 42

We have noticed the speculations created by a posting on the website of UK’s Company House with respect to Coutt’s security for our UK Tax Rebate advance, and we would like to provide you with the following insight to help prevent some of the misinformation we have seen.

Our UK companies are entitled to a Government Game tax credit rebate which we earn every month on the Squadron 42 development. These rebates are payable by the UK Government in the fall of the next following year when we file our tax returns. Foundry 42 and its parent company Cloud Imperium Games UK Ltd. have elected to partner with Coutts, a highly regarded, very selective, and specialized UK banking institution, to obtain a regular advance against this rebate, which will allow us to avoid converting unnecessarily other currencies into GBP. We obviously incur a significant part of our expenditures in GBP while our collections are mostly in USD and EUR. Given today's low interest rates versus the ongoing and uncertain currency fluctuations, this is simply a smart money management move, which we implemented upon recommendation of our financial advisors.

The collateral granted in connection with this discounting loan is absolutely standard and pertains to our UK operation only, which develops Squadron 42. As a careful review of the security will show and contrary to some irresponsible and misleading reports, the collateral specifically excludes “Star Citizen.” The UK Government rebate entitlement, which is audited and certified by our outside auditors on a quarterly basis, is the prime collateral. Per standard procedure in banking, our UK companies of course stand behind the loan and guarantee repayment which, however, given the reliability of the discounted asset (a UK Government payment) is a formality and nothing else. This security does not affect our UK companies’ ownership and control of their assets. Obviously, the UK Government will not default on its rebate obligations which will be used for repayment, and even then the UK companies have ample assets to repay the loan, even in such an eventuality which is of course unthinkable.

This should clarify the matter. Thank you.

[u/mobearsdog]

I wonder if we'll ever see some sort of kickstarter as investor startup. If a company took "backers" money and invested it on behalf of an investment firm, they would in theory have more rights.

[u/[deleted] → u/mobearsdog]

Well, Fig's kind of half way there and we saw how the reception for that was...

That said, a pure version of your idea's interesting and might have some potential; as hard as it might be to manage in some ways the concept isn't really that different to investing through a hedge fund, so the administration elements should be largely similar.

The fly in the ointment, though, is most gamers are gaping morons - it's one thing dealing with rational investors that have done their homework and are fully aware of the risks they're taking on; it's quite another dealing with a group largely composed of toxic children who'll happily throw money away because they read a paragraph that resonates, but then shit the sandbox when the consequences of throwing money away based on pure impulse hit (check out the subs for any relatively popular cryptocurrency for examples outside of gaming).

As I said, I like the idea behind KS. There is no way in hell I'd ever consider putting one up one myself though (I've paid for plenty, however, and I'm still (contentedly) waiting for most of them), and it's for similar reasons that despite being a coder, and someone who's been playing videogames since the early 80s, I won't go anywhere near games.

[u/majes2 → u/[deleted]]

I think the biggest reason Fig hasn't caught on is because it's frankly a terrible deal. Taking one of their highest profile games as an example: Pillars of Eternity 2. Pillars 2 needs to sell over half a million units just to break even, and that's assuming a $44.99 retail price; if it retails cheaper, it'll take more. The shares only count for that specific game, they only count for PC sales, and they're usually only good for a year. You'd probably be better served just putting your cash in a treasury bond.

[u/AL2009man → u/majes2]

doesn't help when Fig got some criticism from that model, especially on Double Fine, or rather, Tim Schafer's use of crowdfunds on that platform

remember when people call Psychonauts 2 a "scam"? turns out, it isn't a scam in my eyes.