Earlier tonight, Anime Sols entered the final 24 hours of fund-raising for its first major project. Their drive for Creamy Mami sailed past $18,000 in funding, from over 180 individual donors. Given the current velocity of pre-orders, it seems almost certain that the project will sail past its funding goal by some margin.
Before we continue, though, I do want to stress that full funding isn’t a sure thing. Earlier today, Anipopo’s Santa Company failed to reach its Kickstarter goal by $980. So, while the title is close to its goal, that does not, by any stretch, mean that its reaching the $19,000 goal is a sure thing.
I must admit, though, that the build-up to this point has been nothing short of impressive.
For the past two months, discussions have revolved around whether the company would be able to successfully fund a title. Donations were modest in early days, and people seemed wary about putting money down on an unproven player in the market. As the months went on, though, Anime Sols was able to tell its story to the world through interviews and personal interaction via social media.
The model really began to evolve about a month ago, as the episodes on Anime Sols numbered in the dozens, and pledgers began to become sneezers. They started to advocate their favorite titles, as each shared a stake in the final outcome. These pledgers wanted their products, which drove their enthusiasm to push the brand, and to promote awareness both in the shows and the services Anime Sols offered. In this sense, if Creamy Mami reaches its goal, the achievement would signify a success in the crowd-funding model, as well as an investment of trust in Anime Sols as a whole.
In the hypothetical situation of a fully-funded title, we would see the company reach a turning point. With a funded project under its belt, the company would be obligated to use the earnings to fulfill the needs of several entities:
- Overhead Costs
The customers, obviously, are the backers. They’re the ones who purchased the products, thus providing an influx of cash to the project. This group will demand compensation in the form of the products they were promised, delivered in a timely manner. Failure to deliver a product would create an immediate backlash from this group. This could take the form of negative publicity, reduced future sales, and, in extreme cases, costly class action suits that can quickly drain the company’s coffers. This is Anime Sols’s bread and butter and, without their support, there is no Anime Sols.
Investors are the external parties with a financial interest in Anime Sols as a whole. They provided the initial cashflow to get the service up and running, and they provide services to facilitate operations and acquisition of licenses. While investors are a vital force in getting a company off the ground, they do often requires some form of compensation. This is usually furnished in either a loan payment, or in an actual stake in the company. If the investor is granted a stake, they gain some influence in the company’s decision-making (depending on the size of the stake), as well as a portion of all profits generated by the company. Depending on the terms of the agreement, this stake can sometimes be sold in the form of stock, which allows some liquidity to a company that doesn’t want to remain a holder in the entity. I can’t say with certainty which arrangement Anime Sols entered into with its partners. Personally, though, I wouldn’t be shocked if they weren’t granted a stake in the company for their investment in the venture.
The final major obligation, overhead, is the basic costs of doing business. From paying for the server to maintaining employee payrolls, these costs ensure that Anime Sols will be able to keep the lights on going forward. Defaulting on these isn’t an option, as services like electricity and server charges will be shut off without payment. Similarly, taxes are just another cost of doing business. And, while they’re not in the same category as overhead, they are a vital part of ensuring that the business keeps running, and that local and national governments are properly compensated via sales.
On top of this, there is an expectation of growth. With new funds coming into the company, Anime Sols would be expected to grow and expand. They’d be tasked with adding new employees, securing larger numbers of potential titles, and fleshing out the numerous “Coming Soon” sections on the company’s website. By doing so, Anime Sols would be able to create a positive feedback loop, which would lead to people sharing more content and bringing more potential customers to the website. More potential customers would lead to more titles being funded, which would ideally lead to greater revenues being brought into the company coffers.
On the surface, the challenges may seem insurmountable. Assuming the company actually does meet its goals, they’ll need to satisfy four disparate groups while growing a business in a sustainable manner. The task seems almost impossible to outsiders, let alone those trying to make it happen. These challenges are far from insurmountable, though, and will help Anime Sols grow and evolve into a lean, sustainable operation if the company can overcome them.
Before we get ahead of ourselves, though, there’s still the matter of seeing that Creamy Mami does reach its funding goal first and foremost. As always, until the project crosses the threshold, our commentary should be seen as strictly speculative.
Editor’s Note: As of 8:00AM on July 27, 2013, Creamy Mami is fully funded. -MJF