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Original poster

Mumsnet verdict needed: is this morally wrong?

122 replies

00100001 · 23/09/2020 19:24

A friend of mine has done this, is it it morals wrong? Some details slightly changed.

He has run a kickstarter to raise money for a board game he has designed. You can back at different levels etc. He has raised £2,500.
He is now going to only produce the amount of copies needed to send to backers, and Is keeping the rest to pay off his personal credit card debt

For those of you who are unaware, most backers fund these project s it is implied at the news essential money is used to make additionally copies to sell, rpay for advertising or other costs, or perhaps towards the next project.

I feel it is wrong, akin to the PTA fundraising for playground equipment, raising £2500, spending £1000, and the head of the PTA us ingredients the leftover £1500 to pay off their credit card.

What is the verdict?

OP posts:
SequinsandStiIettos · 23/09/2020 20:03

Meh. I thought Kickstarter was pledges and you chose how much you paid for a reward in return so as long as I got what I paid for - a script, a signed photo, a copy of a film, track or in this case a game, I'd be fine...as long as the game was what was promised and not a dirt-cheap knock off/huge u-turn from what was promised.

user1481840227 · 23/09/2020 20:03

wow wish I could edit that, that sentence came out all wrong Grin Confused.

SoulofanAggron · 23/09/2020 20:03

I think it's verging on illegal, as he raised the money under false pretences.

randomer · 23/09/2020 20:03

You even need to ask?

flourbroach · 23/09/2020 20:12

If this was his intention all along, then he has deceived people into giving him money when he knew he wasn't going to use it for the business. Legitimate expenses are one thing, this smacks of fraud.

Anyway... is he registered as self-employed?

MsEllany · 23/09/2020 20:14

@limpingparrot

He deserves to be paid for his work designing the game. So he should take some of the profit and pay himself. What he chooses to spend is up to him as long as it is declared and taxed appropriately.
Yes I agree with this. Kickstarter isn’t like a Go Fund Me, like raising money to pay a medical bill the actually using it to pay off your mortgage Hmm. It’s for (I thought) creating a product that you will sell for profit.
Notyoungbutscrappyandhungry · 23/09/2020 20:19

It's a business idea. It's surely implied he will be making money from it? As long as the supporters get what they were promised I don't see what the problem is. He has basically made £1500 profit from his idea, minus production costs. Sounds fair.
It's not like the PTA because it isn't a charity.

WatershipDown7 · 23/09/2020 20:19

Of course it’s morally wrong! Fraud, pure and simple .

TheHobbitMum · 23/09/2020 20:21

Shock As someone who backs many, many boardgames on KS I'd love to know which game!

Absolutely fraudulent Angry

wildcherries · 23/09/2020 20:21

@limpingparrot

He deserves to be paid for his work designing the game. So he should take some of the profit and pay himself. What he chooses to spend is up to him as long as it is declared and taxed appropriately.
Agree with this.

He used the donations to fund the game first. I wouldn't have a problem with this.

TheHobbitMum · 23/09/2020 20:24

I've climbed off my soap box a bit and re-evaluated to say as long as everyone got their pledge (to the standard they expect not on the cheap to cut costs) , I guess he wouldn't be the only one who has kept the extra funds rather than reinvest.
I think it's wrong but he's not actually going against the rules, has he said in the KS page what extra funds are being put towards? Often it's upgraded components etc

MissLucyEyelesbarrow · 23/09/2020 20:25

Its a kickstarter, not a business investment. The people who contributed were not anticipating any interest back on their donation. He got donations, made the game and distributed to people who donated. Perhaps word of mouth will be enough to get it off the ground. Perhaps not. But that's his business decision to make. Him opting to pay himself a sum of money (for creative input, design, manufacturing and distribution) is not fraud. I'm not saying its good business acumen but it certainly isn't fraud, or morally wrong

Agree. Fraud is second only to breaches of GDPR in the amount of bullshit talked about it on MN.

DanielRicciardosSmile · 23/09/2020 20:28

I don't really see a problem with it tbh. The investors are getting what they were promised, so I can't see how its fraud. I also don't see how your PTA example is anything remotely like the same thing.

ThePlantsitter · 23/09/2020 20:33

The PTA is a different situation. The law is very clear on charities and what they spend their funds on. Individuals volunteering for a charity would be fraudulent (or whatever the legal term is here) if they used it for their own personal spends.

Kickstarter isn't a charity and it isn't an investment company. The guy isn't a charity and he wasn't asking for investments. Essentially he was asking for gifts to set up his business OR he was asking people to pay through the nose for a rare game, either of which they would have done without the expectation of receiving anything but the game. So he's met his side of the bargain. I just don't think there's a problem. It's a shame, possibly, and a wasted opportunity but that's not immoral or illegal.

RoseTintedAtuin · 23/09/2020 20:33

I don’t think your example is the same at all. He has taken payment for a project in development, he will provide the end project to his customers - honouring his part of the contract, what he does with the profit is entirely up to him, his customers haven’t bought sales or have any interest in the success of future projects. Unless in his terms it states how he will spend profit then he can do what he wants with it be that pay himself for hours spent, declare it all as profit or finance his next project. The only difference between these is his tax position. I don’t think he is doing anything legal and if he hasn’t misrepresented the use of the funds then morally is fine too.

MilerVino · 23/09/2020 20:34

As long as the supporters get what they were promised I don't see what the problem is. He has basically made £1500 profit from his idea, minus production costs. Sounds fair.

This. So long as he sticks to the kickstarter terms and pays whatever, if anything, is due to HMRC, I don't see the issue. Part of the production of a game is his time and effort. If he then chooses to use the wage he paid himself to pay off his credit card that's up to him.

It's like getting sniffy about what Big Issue sellers buy with what they get from selling the magazine. You bought the magazine, you got what you paid for, what they do with what they earn is up to them.

RoseTintedAtuin · 23/09/2020 20:34

*Illegal

cabingirl · 23/09/2020 20:34

What would you prefer he did with any profit left after fulfilling the items sent to those who gave money for those items?

When I've 'donated' to Kickstarter it has been for items that I wanted and felt my pledge level was good value for what I was getting.

Do you ask other private businesses what they do with their profits?

YippeeKayakOtherBuckets · 23/09/2020 20:40

I think you don’t understand Kickstarter at all.

cabingirl · 23/09/2020 20:44

When you come up with the budget for your Kickstarter project you are advised to include labour costs - whether that's your wage for your work or anyone else who needs to be paid. The money isn't just for the bare physical cost of producing the product.

If he wants to use his wages, that he earned by creating a product and selling it to pay his debts or to go on holiday - that's entirely up to him.

MarshaBradyo · 23/09/2020 20:44

KS isn’t a donation as such it’s a prepayment for a product.

As long as he sends the product it’s ok

Namechangearoo · 23/09/2020 20:52

Grin at all the people saying “that’s fraud” so confidently when it absolutely is not.

DollyDoneMore · 23/09/2020 20:52

It’s not fraud or anything like it. You are fundamentally misunderstanding Kickstarter.

Kickstarters offer funders rewards when they reach their target. As long as funders get their rewards as promised, it’s fine. It’s not a charity. It’s a business transaction.

It’s entirely irrelevant how he spends the income he raises.

Gobelinoisawitchescat · 23/09/2020 20:52

People have just pre-funded the product they will receive. How he chooses to spend the profit it up to him.

BoomBoomsCousin · 23/09/2020 20:53

I use kickstarter a lot and I don't see anything morally wrong with what your friend is doing. Kickstarter is a marketing platform where the buyer takes some risk (because a project, even if funded, may not ever produce the goods). If your friend took the money, paid off his credit card and didn't make a good faith effort to create enough games for the backers, I'd think that was morally wrong. But as a backer you're just paying a business for the game you've put money down for, it's not a charitable donation that should be used towards the common good or something. Your friend is the owner of the business and if he wants to take the profits out of the business after fulfilling his obligations there's nothing wrong with that.

It is business income though, not a gift, so he will need to pay what ever tax is owed.

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