The worlds largest crowdfunding service has now officially been launched in Denmark, Norway, Sweden (and Ireland)
Seen as part marketing and part financing solution, the crowdfunding service, Kickstarter, has given game developers across the world a chance to pitch their projects directly to the players themselves, instead of going through the traditional investors and gatekeepers. Thus, classic genres such as the isometric RPG, the spaceflight simulator, and the point-and-click adventure has been revived with great success with projects such as Torment: Times of Numenera, Elite: Dangerous, and Broken Age.
There has also been plenty of Nordic projects trying their luck with Kickstarter’s crowdfunding platform – some of them with great success. Ragnar Törnquist’s continuation of the Longest Journey/Dreamfall series, Dreamfall: Chapters, ended up garnering more that 1.5 million dollars last year. And Danish reboot of turn-based tactical shooter Jagged Alliance, Jagged Alliance: Flahback performed admirably, as it drew more than 350.000 dollars.
But so far, all of these projects have been forced to have a representative in either the UK or the US, as only people in those countries could register as the recipients of the funds gathered through Kickstarter projects. But as of last week, that limitation was finally eliminated, as Kickstarter officially launched their services in Denmark, Norway, Sweden, and Ireland.
Read more about: SpilBar: Funding Your Game Through Kickstarter
Projects created within these new markets will still be listed on the global Kickstarter site, but will now be using the local currency for their project. Danish kroner for Denmark, Norwegian kroner for Norway and Swedish kronor for Sweden. Kickstarter will also deduct an additional fee in these new markets, amounting to 3% + 3.00 SEK/NOK/DKK per pledge over 100 SEK/NOK/DKK. For pledges below 100, the fee is 5% + 1.00 SEK/NOK/DKK
The Scandinavian markets have traditionally been very active on Kickstarter, especially compared to their size. In a statistic from earlier this year, Kickstarter revealed that Sweden was the 9th biggest contributor, when measured in terms of money pledged. Based on numbers from March this year, Denmark contributed with 0.4 % of all Kickstarter funding, Norway 0.4 % as well and Sweden 0.7 %. In comparison, Finland only contributed with 0.25 %, which might explain why they have not been included in this expansion.
However, Thomas H. Lund, CEO of Full Control, the developer behind the biggest Danish Kickstarter, Jagged Alliance: Flashback, doesn’t think that these changes will revolutionize crowdfunding in Scandinavia. Instead, he believes it might give an advantage to smaller developers. “It makes it easier for small teams, who can’t manage to learn how to set up a foreign company, or how you work with someone abroad.”
But he also sees a potential risk in the official lunch of the popular crowdfunding service in Scandinavia.
On the other hand, it could have a big impact, if the tax authority and their friends decide to have a real close look at crowdsourced money.
What Thomas Lund points to is that crowdfunding pledges lies somewhere between investments, charities and purchases. And if the local tax authority in any of the countries where Kickstarter now have launched, should decide that it’s either investments or purchases, the pledges might become subject to VAT or other forms of taxation. Kickstarter themselves state in their official statement regarding the expansion, that Kickstarter funding is subject to taxes “in general”
In general, funds raised on Kickstarter are subject to taxes. That said, how much you owe can vary based on a number of factors. We highly recommend talking to an accountant or tax advisor.
So far, only the Danish consumer organization have made an official statement, saying that they see Kickstarter as more of a charity than anything else, in an interview with Danish newspaper, Politiken. But there is still no word from taxation organizations in Scandinavia.
Kickstarter themselves however, might have pushed their service more in a direction of a sales/purchase service with their latest changes in their terms. Facing a recent string of uncompleted projects, they have now added to the terms that if a project is funded, the “creator must complete the project. ”
Do you think, this will change anything for crowdfunding in Scandinavia? Let your voice be heard in the comments.