Visual Novel [renamed]

[walkingeagle]

Fred does not "send" me anywhere. I answer questions here on my own hat. I'd like to think I'm helping.

Yeah except that you only have to step in because he won’t.

If “send” is inaccurate, how’s “require the intervention of”?

[cidjen]

mmm [1417] (speaking for myself only, as to why I get involved) you probably won't understand.

[legitalltheponies]

People would be happier with an update now of "I haven't made any progress in the VN yet because of X, Y, and Z, I am really sorry." or whatever rather than having no update for some number more months to finally get an update of "Hey look, I finally got this significant step done!"

I did do exactly this for quite some time, and for exactly that reason. We did talk to Fred about the need to post updates, even when the news was not good. While he understands that intellectually, actually getting him to do it is an entirely different thing. It's not that he's trying to hide anything; he'd just rather work than talk about it. This is why you hear a lot more from me than you do from Fred, despite my limitations.

This isn't on you and you're well aware of it, but not updating does two things: it puts more pressure on him and we can't see what he's doing. Even if he's working hard and has a game plan going forward, but from here it looks like he isn't doing anything.

I have stopped doing this recently for several reasons. One of which is that those explanations produce a kind of fatigue. To quote walkingeagle from earlier in this thread: "Fred is in his 50’s, has health issues, parents, blah blah blah.". People have good reason to be unhappy about how the VN work has gone, and it is all too easy (if rather unfair) to view the reasons for that as mere excuses, especially when those reasons keep getting repeated in updates as a seemingly never-ending series of long-term ongoing problems. If y'all are tired of it, imagine how Fred feels.

Again, the best way to counter this is to post. an. update. Have someone else write it if Fred can't bring himself to do it. Also, I'm tired of hearing how unfair everything is for Fred. I get that he's struggling with life events and those piled up on him all at once, but people have variations on problems like his all the time while juggling regular full time jobs. None of this is unique to him and the man has been a black hole of self pity since the comic was in its infancy.

I'm not going to wait until "yay we have the VN done" before posting an update. But I'm also done with posting monthly updates that there has been no progress. When Fred can get back on the VN work (which likely won't be real soon), I will certainly post an update and let everyone know.

Okay, that's big news that we needed to know and not just in a forum post.

Again, the fundamental problem is that the VN work has gone so poorly. I get that, and y'all have every reason to be upset about it. I'm sorry, and so is Fred.

I don't think that you apologizing on Fred's behalf helping with any of the frustration we're feeling.

[walkingeagle]

So correct me if I’m wrong but...

Fred prefers to work than to talk about work.

But he “can’t work on the VN for a while and likely won’t be able to for a while.”

So he prefers to work than talk... but he can’t work... and he won’t talk...

Do you seriously not see the problem with this?

[paarfi]

I'm sorry if this wasn't clear. Fred's plan (as he described in his May post) is:
1) Get the comic rolling [with his target of 4 comics per month]
2) Get the store shipping backlog taken care of
3) Get back on the VN
With all the problems he's been having the last few months, he hasn't managed the comic production that he owes the patreon supporters, and he's still not caught up with shipping backlog. Once teh comics are rolling again and the shipping is all done, then he'll have time to work on the VN in a serious way again. He had hoped to be at that point earlier in the year, but it didn't happen because of various life disasters and ongoing time-sinks.

When I said "likely won't be real soon", it was not some big secret revelation that was being hidden and now "Ah ha! The truth is revealed!" It was me seeing that comics are not yet rolling to level that Fred has promised the patreon supporters, and me seeing that the store shipping is not yet fully done. Hence (per Fred's plan), he still has stuff to do before he can get back on the VN work in a serious way.

I understand y'all are angry about this. I know it's not good enough, but he is doing the best he can.

[Concerned_user]

I'm sorry if this wasn't clear. Fred's plan (as he described in his May post) is:
1) Get the comic rolling [with his target of 4 comics per month]
2) Get the store shipping backlog taken care of
3) Get back on the VN
With all the problems he's been having the last few months, he hasn't managed the comic production that he owes the patreon supporters, and he's still not caught up with shipping backlog. Once teh comics are rolling again and the shipping is all done, then he'll have time to work on the VN in a serious way again. He had hoped to be at that point earlier in the year, but it didn't happen because of various life disasters and ongoing time-sinks.

When I said "likely won't be real soon", it was not some big secret revelation that was being hidden and now "Ah ha! The truth is revealed!" It was me seeing that comics are not yet rolling to level that Fred has promised the patreon supporters, and me seeing that the store shipping is not yet fully done. Hence (per Fred's plan), he still has stuff to do before he can get back on the VN work in a serious way.

I understand y'all are angry about this. I know it's not good enough, but he is doing the best he can.

Correct me if I'm wrong but didn't the kickstarter for the VN come before he had Patreon? And also does it not seem silly to prioritize 4 pages of a comic per month to the tune of less than 2 grand for patreon supporters and not work on a projector that people already spent a combine 300k on?

Its like Fred wants to have the cake and eat it too. What you're saying may very well be the way things are and how he is thinking, but it is not reasonable, logical or responsible. And I wouldn't keep referring back to a tiny blurb in the middle of a rant to show he addressed or clarified anything in regards to the VN. He really needs some true friends to put him in his place and make tough decisions, instead of what appears to be nothing but enablers and excuse makers.

[walkingeagle]

You know what would really clear things up?

If Fred spoke for himself, and didn’t require a special time and auspicious portents and everything to be just right, to do so.

You know. Like everyone else does when they’ve pocketed 300k and have nothing to show for it.

[shadowrunner23]

Even though the reasons DO get very blah blah blah, having them is so much more preferable than the current situation.

The main reason there is such anger is that y’all have given us nothing at all for over a year officially, and nothing unofficially other than a paragraph in the middle of other paragraphs, easily missed and not much info.

It’s the feeling of being ignored, that 300k was taken and no one cares if we sit here and stew about it for years at a time, that is the biggest problem imo.

Frankly, Fred takes his time. I'm not saying there isn't a communication issue, there definitely is, and I think they should at least make a "we're alive and working on it still" post every two months (i'd welcome that). I knew that the estimated dates were far too optimistic when I paid into the VN. I also realized something many here seem to have missed:
There was a great risk of the VN never being finished. The VN was ambitious on Fred's part, and i'm certain he felt he could manage it. Maybe that hasn't been the case. as is, i'm sure Fred has a list of things he would have done differently. The fact is, it was another kickstarter campaign. yes some of those work out great, but plenty of others failed even after the money was raised. Paying into the VN was like playing the lottery; there's no guarantee of a return.

If I may make a recommendation for Fred, Maybe drop the schedule down to 3 pages per month, and use that extra time to work on the backlog, then the VN. I'm enjoying the comic pages, but I think you may have set the bar a bit too high with the four pages and all of the other things that need to be done. If you need help, put out a request to the community. I have not given up on the VN, And as of right now, I do feel there's a good chance of it being completed at some point.
I also agree with Zagaroth, The more you guys get all angry, the less Fred is likely going to want to deal with it. So bolt a heatsink to your head, cool off, and perhaps provide CONSTRUCTIVE feedback, other than "we've put all this money in and we see nothing!"

[Concerned_user]

[/quote]

Paying into the VN was like playing the lottery; there's no guarantee of a return.

[/quote]

No, a kickstarter is not equivalent to playing the lottery. Just because something does not carry with it a guarantee, doesn't mean its the same thing. A lottery is based on the idea you will most likely not win. There is only a tiny fraction of a chance you could win in your lifetime. A kickstarter campaign is when funds are solicited and rewards and products offered in exchange. Sure there is a possibility the project fails, as many do. The point is how that failure is dealt with and conveyed to the backers. It is a legal contract between the creator who solicited the funds (Fred) and the backers (you and others).
People have a right to expect a full report from Fred indicating the current status of the project and cost breakdown so far and an honest answer to if they should ever expect it to be complete. That is his responsibility and he has not filled it. You as one backer and perhaps blind fan boy, don't get to decide for everyone that its just who he is to be irresponsible and everyone should accept it without frustration and move on. Some people perhaps put in a lot more money than you and rightfully want a straightforward answer.
Sure there are people who may toss around insults in their anger, and I think they are wrong to do so, but people like you are also wrong. You are at the other end of the spectrum, where you see nothing wrong with what has taken place.
Its gotten to the point where people just want the absolute minimum here. They don't expect a VN or even rewards any longer, just a breakdown of where the money went, and why things failed. Not a couple sentences hidden in a long rant either. Anything less is irresponsible and insulting on Freds part. Integrity matters.


Here is the terms of use taken directly from kickstarter:

the contract is a direct legal agreement between creators and their backers. Here are the terms that govern that agreement:

When a project is successfully funded, the creator must complete the project and fulfill each reward. Once a creator has done so, they’ve satisfied their obligation to their backers.

Throughout the process, creators owe their backers a high standard of effort, honest communication, and a dedication to bringing the project to life. At the same time, backers must understand that when they back a project, they’re helping to create something new — not ordering something that already exists. There may be changes or delays, and there’s a chance something could happen that prevents the creator from being able to finish the project as promised.

If a creator is unable to complete their project and fulfill rewards, they’ve failed to live up to the basic obligations of this agreement. To right this, they must make every reasonable effort to find another way of bringing the project to the best possible conclusion for backers. A creator in this position has only remedied the situation and met their obligations to backers if:

they post an update that explains what work has been done, how funds were used, and what prevents them from finishing the project as planned;
they work diligently and in good faith to bring the project to the best possible conclusion in a timeframe that’s communicated to backers;
they’re able to demonstrate that they’ve used funds appropriately and made every reasonable effort to complete the project as promised;
they’ve been honest, and have made no material misrepresentations in their communication to backers; and
they offer to return any remaining funds to backers who have not received their reward (in proportion to the amounts pledged), or else explain how those funds will be used to complete the project in some alternate form.
The creator is solely responsible for fulfilling the promises made in their project. If they’re unable to satisfy the terms of this agreement, they may be subject to legal action by backers.

[walkingeagle]

The more you guys get all angry, the less Fred is likely going to want to deal with it.

Ohhh, my bad. I thought we were talking about a 49 year old man with legal obligations to make what he was backed to make, not a potty-shy three year old.

You’re absolutely right. Instead of expressing our displeasure at 300k vanishing with no return, we should have realized it's just so impatient to expect even one chapter to play about half a decade after it was meant to be finished, or even a real update at least once a year. We should have swallowed hard and laid a few more boxes of pocky at the feet of the Altar of Gallagher-sama in the hopes that he’ll finally grow a sense of professional responsibility and/or the beginnings of a spine.

My bad.

ETA: If anyone wants to bitch at me about what I’ve said here, I’ve got a novel idea - instead of whining about how I’m so mean and it’ll hurt Fred’s delicate psyche, and how that’s somehow the reason he doesn’t give value on what he was backed for or update for YEARS despite practically no one saying a word for those years... instead of that... either tell me how I’m wrong without focusing on my tone, or go resume your reverent vigils in the hopes senpai will notice you. Because that’s clearly worked wonders so far.

[drgnmstr44]

Came here looking for an update to this but I can see what's happening. A bunch of people who don't seem to understand the risk when backing something on kickstarter or didn't bother actually reading it. I'm a backer too but I kind of figured it was a lost cause because it blew up to be a huge project and at the time comics weren't really being posted regularly. Everyone is yelling about you can't just take 300K and give nothing, but nothing we can do about it. It's a Kickstarter video game which, while I would think it not intentional here, have a bad reputation of falling and failing to deliver.

There is nothing we as backers can do about it to get a product that doesn't exist or our money back. It's just not going to happen. It would be nice to see it complete but I think everyone needs to realize this is a small team doing this game with one artist, who has to also manage a web comic and a store. I've backed many things over the years and have lost some money to other projects too that failed to be completed after being backed. Not really much to do. maybe someday it will get completed, but I'm not holding my breath for it. I still enjoy the web comic and the other things from the store as well as the novels.

[Concerned_user]

Came here looking for an update to this but I can see what's happening. A bunch of people who don't seem to understand the risk when backing something on kickstarter or didn't bother actually reading it. I'm a backer too but I kind of figured it was a lost cause because it blew up to be a huge project and at the time comics weren't really being posted regularly. Everyone is yelling about you can't just take 300K and give nothing, but nothing we can do about it. It's a Kickstarter video game which, while I would think it not intentional here, have a bad reputation of falling and failing to deliver.

There is nothing we as backers can do about it to get a product that doesn't exist or our money back. It's just not going to happen. It would be nice to see it complete but I think everyone needs to realize this is a small team doing this game with one artist, who has to also manage a web comic and a store. I've backed many things over the years and have lost some money to other projects too that failed to be completed after being backed. Not really much to do. maybe someday it will get completed, but I'm not holding my breath for it. I still enjoy the web comic and the other things from the store as well as the novels.

Apparently the rewards have not been issued that were promised which is something people have the right to be upset about. They also have a right to be upset about the lack of straightforward honesty and communication. As for making the excuse of having a comic and store to run, I know kids and adults alike who can complete a hell of a lot more than he has been. Barely one page a week is not worth the money this man makes. I've worked in a 2 man operation and I know how challenging it can be to work on large projects, but you get them done when you are paid the money, or you give back the money, that is how honest business is conducted.
He wants to have his cake and eat it too. Continuing a comic that should have ended long ago for the sake of milking every last dime from the blind followers.
Its fine your cool with the unprofessional way all of this has been handled, but people have a right to more, a lot more and I encourage them to fight for the most basic and sad end to this, and thats a written explanation from the man himself about how and why things went wrong, an apology and an answer that people will not be getting what they are owed. Anything less is an insult to the people who played a large part in giving him the life he lives.
Barely one page a week for a comic is a damn joke, for the money invested by fans.
People understand risk perfectly fine, they just expect people to take the appropriate responsibility for it.

[Concerned_user]

Came here looking for an update to this but I can see what's happening. A bunch of people who don't seem to understand the risk when backing something on kickstarter or didn't bother actually reading it. I'm a backer too but I kind of figured it was a lost cause because it blew up to be a huge project and at the time comics weren't really being posted regularly. Everyone is yelling about you can't just take 300K and give nothing, but nothing we can do about it. It's a Kickstarter video game which, while I would think it not intentional here, have a bad reputation of falling and failing to deliver.

There is nothing we as backers can do about it to get a product that doesn't exist or our money back. It's just not going to happen. It would be nice to see it complete but I think everyone needs to realize this is a small team doing this game with one artist, who has to also manage a web comic and a store. I've backed many things over the years and have lost some money to other projects too that failed to be completed after being backed. Not really much to do. maybe someday it will get completed, but I'm not holding my breath for it. I still enjoy the web comic and the other things from the store as well as the novels.

Apparently the rewards have not been issued that were promised which is something people have the right to be upset about. They also have a right to be upset about the lack of straightforward honesty and communication. As for making the excuse of having a comic and store to run, I know kids and adults alike who can complete a hell of a lot more than he has been. Barely one page a week is not worth the money this man makes.
He wants to have his cake and eat it too. Continuing a comic that should have ended long ago for the sake of milking every last dime from the blind followers.
Its fine your cool with the unprofessional way all of this has been handled, but people have a right to more, a lot more and I encourage them to fight for the most basic and sad end to this, and thats a written explanation from the man himself about how and why things went wrong, an apology and an answer that people will not be getting what they are owed. Anything less is an insult to the people who played a large part in giving him the life he lives.
Barely one page a week for a comic is a damn joke, for the money invested by fans.
People understand risk perfectly fine, they just expect people to take the appropriate responsibility for it.

[Ambivert]

ETA: tell me how I’m wrong without focusing on my tone.

I'm not anyone close to Fred, nor have i ever communicated with him. I'm just a lurking MT reader/VN backer ($35 beta tester tier) from the other side of the globe. I decided to answer you, along with anyone else who shares your sentiments, because i find your numerous posts flogging this dead horse to be annoyingly childish (in my opinion) and vindictive (definitely).

Here's how you're wrong without focusing on your tone:

Responsibility - i'm sure as an adult you know that when you purchase things like stocks & shares, bonds and savings plans, you're investing in a business without any guarantees of its future performance or even survival. You take on the risk of the company failing and in the worst case scenario closing down, resulting in the total loss of your investment. Kickstarter pledges are exactly like that - they are not purchases of goods in the conventional sense. This reality is reflected in the disclaimers on Kickstarter's policy pages that project creators are only obliged to fulfill rewards on a 'best-effort' basis, and Kickstarter itself is not liable for any refunds or losses. It's called "business failure". Your rage is rightly directed at yourself for not understanding how Kickstarter works before putting down money, and/or Kickstarter for not making the above better known at the time. You have no legal standing here.

"Scam" - A business venture is not a scam as long as the company operated in good faith towards their stated goals for as long as they reasonably could. We believe that Fred & co. worked on the VN for 3 years. Their business failure lay in a gross underestimation of the size, length, and therefore cost of the project, or even in Fred's personal neuroses as project lead, but they presumably did work. You could even get a good idea of what happened to the $299184 yourself - 3 full-time team members (including Fred), $3000/month salaries, 3 years: 3 x $3000 x 36 = $324000, easily. You think 300 grand is a large amount of money? Not to a company over years. Undoubtedly, after the money was gone without a finished product, Fred had 3 options: (a) refund all backers (b) finish the VN on his own dime (c) do neither. In his shoes, would you choose (a) and instantly bankrupt yourself? With sick parents and a young child to support? Assuming you even had that amount of your own money in the bank? Get real. He has pledged to finish the VN, and that's better than option (c) (which as stated above he could very well do), so i'll wait.

Communication - clearly this whole debacle keeps you up at night, but i suspect most backers are more similar to me - i gave away a sum of money some time ago, i've heard it ran into serious problems so i stopped expecting it to materialize anytime soon, and nowadays when it comes to mind about once a year i visit the relevant sites to see if there are updates. Even a cursory browse this evening showed me that Paarfi has written multiple somber posts explaining the situation, and even Fred himself in that one rant, saying much the same thing. First, i accept Paarfi as an official representative, so it doesn't have to be fReD hiMsElF. Second, if he really has had to spend the last 2 years struggling to keep his family alive, i personally don't want to have to check through 24 monthly copy-paste statements just to see if any of them contained actual news. As they have already stated, "no developments until further notice". Is that so hard to understand?

Of course, everything above assumes Paarfi & Fred are given the benefit of the doubt and what they've said is true. Personally, i don't see any reason to disbelieve them at this point in time. All that shit could very well happen to anyone (which you've pointed out repeatedly). So, business failure - i knew the risks i was getting into.

If Fred's life improves and he's serious about using his own money going forward to eventually finish the VN, i'd be happy. I don't care if it's 10 years later, at least we would be getting it. That's better than other KS backers.

From a more human perspective, would i want one man and his family to bankrupt and ruin themselves just so 4,958 people could get back a nice meal at a restaurant each on average? No. And if you would, well then that's where we start talking about your character.

[Ace42]

'This reality is reflected in the disclaimers on Kickstarter's policy pages that project creators are only obliged to fulfill rewards on a 'best-effort' basis, and Kickstarter itself is not liable for any refunds or losses. It's called "business failure".'

Let's see what Kickstarter's policy page says:
If a creator is unable to complete their project and fulfill rewards, they’ve failed to live up to the basic obligations of this agreement. To right this, they must make every reasonable effort to find another way of bringing the project to the best possible conclusion for backers. A creator in this position has only remedied the situation and met their obligations to backers if:

they post an update that explains what work has been done, how funds were used, and what prevents them from finishing the project as planned;
they work diligently and in good faith to bring the project to the best possible conclusion in a timeframe that’s communicated to backers;
they’re able to demonstrate that they’ve used funds appropriately and made every reasonable effort to complete the project as promised;
they’ve been honest, and have made no material misrepresentations in their communication to backers; and
they offer to return any remaining funds to backers who have not received their reward (in proportion to the amounts pledged), or else explain how those funds will be used to complete the project in some alternate form.

The creator is solely responsible for fulfilling the promises made in their project. If they’re unable to satisfy the terms of this agreement, they may be subject to legal action by backers.

Business failure or no, pretty much none of these obligations has been met.
A breakdown of expenditure should be made available to account for how the funds were used (it is a fraud if they were used on costs other than for the project itself), and any remaining funds be used to issue proportional refunds. "Hey, if we do some maths on the back of an envelope we can make 300k disappear" isn't close to sufficing for this.
The game's assets and materials, such as they are, could be open-sourced to allow the project to progress - and thereby at least have a chance at completion or something to show.
And, as many people have stated, the communication has been poor.

And taking a personal salary out of backer's money is a no-no in general; especially when he is pushing on with other projects in the interim. Project creators make their personal profit out of the success of that project, not out of the pockets of backers who get nothing.

[darrin]

(it is a fraud if they were used on costs other than for the project itself)

Provided (as I mentioned in another thread) by cost is meant "unbudgeted expenditures" and not "things employees spent their salaries on".

And taking a personal salary out of backer's money is a no-no in general; especially when he is pushing on with other projects in the interim. Project creators make their personal profit out of the success of that project, not out of the pockets of backers who get nothing.

Wut.

Profits can certainly be used for employee _bonuses, or shareholder dividends, or whatever else the shareholders care to spend them on. Salaries come from the _expenses_ part of the budget, not revenue and certainly not "profit". The above claim is basically equivalent to saying that every mom-n-pop corner shop in the world is fraudulent or illegal if they pay any salary to any of their employees (prior to the time when they start making vast profits, as all mom-n-pop shops do of course).

[Ace42]

What part of "when /he/ is pushing on with other projects" and "/project creators/" in that quotation made you think I was referring to employees as opposed to Fred himself?

And, in most investment scenarios comparable to this one, it's hard to imagine the start-up team being comprised of salaried employees rather than either other stake-holders (in which case the same principles apply) or else subcontractors (who are paid for a job of work, not salaried).

Without a breakdown of expenditures, we can't even know for a fact if such a rookie mistake (haemorrhaging investment cash on salaries with no prospect it translates to completed work and thus progress towards milestones) occurred - this is precisely the reason the Kickstarter ToS specify the need for an explanation on failed projects.

If we find that the money invested to the project hasn't gone on the project, but has gone directly into the project creator's pocket (self-salary, personal expenses rather than project expenses), that's pretty much criminal. Backers didn't fund him, they didn't give the money to subsidise the Megatokyo webcomic or brand, they gave the money for this specific project and the rewards promised.

[Concerned_user]

What part of "when /he/ is pushing on with other projects" and "/project creators/" in that quotation made you think I was referring to employees as opposed to Fred himself?

And, in most investment scenarios comparable to this one, it's hard to imagine the start-up team being comprised of salaried employees rather than either other stake-holders (in which case the same principles apply) or else subcontractors (who are paid for a job of work, not salaried).

Without a breakdown of expenditures, we can't even know for a fact if such a rookie mistake (haemorrhaging investment cash on salaries with no prospect it translates to completed work and thus progress towards milestones) occurred - this is precisely the reason the Kickstarter ToS specify the need for an explanation on failed projects.

If we find that the money invested to the project hasn't gone on the project, but has gone directly into the project creator's pocket (self-salary, personal expenses rather than project expenses), that's pretty much criminal. Backers didn't fund him, they didn't give the money to subsidise the Megatokyo webcomic or brand, they gave the money for this specific project and the rewards promised.

Bingo!

[darrin]

What part of "when /he/ is pushing on with other projects" and "/project creators/" in that quotation made you think I was referring to employees as opposed to Fred himself?

That doesn't matter, which was the whole point of the mom-n-pop corner store analogy. If the sole (or near-sole) owner is acting in their capacity as (corner store) head pizza chef, or (presumably in Fred's case) head artistic director or whathaveyou, they get a salary, same as any other employee. Obviously investors might raise objections regarding the quality and quantity of work produced commensurate with those salaries; I've kept my mouth shut on those issues and will continue to do so as I have no standing in that. But once the salary is paid, the employee spending that salary isn't in and of itself "fraud" or "criminal" or anything of the sort; my remarks on that side of the issue have been independent of my opinions on Fred and his situation and would apply to any (small) business.

Without a breakdown of expenditures, we can't even know for a fact if such a rookie mistake (haemorrhaging investment cash on salaries with no prospect it translates to completed work

The entire point of venture capital investment is to provide capital to cover operating expenses during the initial period when the company is not yet generating revenue. Salary is included in those expenses; paying salaries isn't a "rookie mistake", it is the only way the work necessary to generate any revenue is going to get done in the first place.

This is an easy experiment you can do for yourself, without any need to listen to any arguments I might make on the subject. Put up some ads on indeed, linkedin, dice, whatever, for any positions you wish -- graphic designers, programmers, writers, editors, etc. When they show up for the job interview, tell them right away that since of course it would be inappropriate to pay them out of the investor's startup capital, you won't be paying them any salary initially, but that as soon as your company starts making money, of course you will then be willing to pay them -- out of the profits, mind you, not revenues. See how long it takes for the prospective employee to suddenly remember their child's doctor appointment or soccer practice, and apologize for having to leave in the middle of the interview. Feel free to record the time it takes between the end of your spiel and them bolting out the door; I'd love to see the mean and standard deviations on those numbers (my own prediction is negative ten seconds plus or minus a half a second).

[Ace42]

That doesn't matter, which was the whole point of the mom-n-pop corner store analogy.

So the facts and common practice doesn't matter; what matters is an analogy which doesn't apply here?

Get outta town.

If the sole (or near-sole) owner is acting in their capacity as (corner store) head pizza chef, or (presumably in Fred's case) head artistic director or whathaveyou, they get a salary, same as any other employee.

What sort of head pizza chef starts cooking pizzas, takes pay for cooking pizzas, but doesn't sell any of those pizzas in order to generate profit and thus pay themselves a wage for three years straight?

Your analogy is specious, and as an accidental justification of embezzlement - it proves too much.

No investment in the world operates on the principle of "this money's for you personally, just so long as you insist that - as the business's head honcho - the personal expenditure is necessary for the business, and that you're really trying to make the business work, honest, scouts honour."

If you want an analogy, it would be investors give money for a pizza start-up to buy an oven; head pizza chef decides he's too preoccupied with his personal life and another job to actually get the business working - so instead of spending the money on the oven, he gives himself a salary to make a few bowls of dough when he feels like it, and hires some waiting staff to stand around looking busy while the cash goes - who-knows-where?

A scenario that is totally indistinguishable from someone trying to scam investors out of money they have no intention of making good on.
Which is, again, why kickstarter's ToS explicitly require a breakdown of costs.

The entire point of venture capital investment is to provide capital to cover operating expenses during the initial period when the company is not yet generating revenue.

The entire point of venture capital is certainly not to pay someone's living expenses so they can mooch off investors, irrespective of your backwards ideas of it.
Investors are buying a stake in the business or farming interest on a loan, not making themselves an ersatz employer of the business owner.

In the case of kickstarter, we are financing a project in order to get clearly established rewards.

Salary is included in those expenses; paying salaries isn't a "rookie mistake", it is the only way the work necessary to generate any revenue is going to get done in the first place.

You mean apart from contracting the work out to freelancers, who then invoice you for the work done instead of receiving a salary? You know, the normal way small limited projects of this specific type are conducted for exactly the reasons that are now apparent?

This is an easy experiment you can do for yourself, without any need to listen to any arguments I might make on the subject. Put up some ads on indeed, linkedin, dice, whatever, for any positions you wish -- graphic designers, programmers, writers, editors, etc. When they show up for the job interview, tell them right away that since of course it would be inappropriate to pay them out of the investor's startup capital, you won't be paying them any salary

So what you're saying is that, in order to prove you wrong, I just have to find anyone on linkedin who takes payment by wage, rather than as salaried work?

Literally any graphic designer who freelances, then?

[darrin]

Or I could simply hire freelancers on a per-job basis and have them invoice me without needing to make them salaried hires.

Make sure you stipulate explicitly in the contract that you have no intention of paying any of those invoices out of the startup capital or company revenues, but only at such time when you're making "sufficient" profit (where sufficient is presumably defined by you personally). Otherwise your freelancers might consider your behavior "fraudulent".

Oh and you might want to give them a heads-up that if (ooh, sorry, "when") their invoices ever get paid, they will be subject to close scrutiny downstream regarding what they spend those earnings on.

[Ace42]

Make sure you stipulate explicitly in the contract that you have no intention of paying any of those invoices out of the startup capital or company revenues

Why? I wasn't saying that it's inappropriate to pay piece-wages for work done; in fact I implied the exact opposite –

From the post which you quoted:
it's hard to imagine the start-up team being comprised of salaried employees rather than either other stake-holders (in which case the same principles apply) or else subcontractors (who are paid for a job of work, not salaried).

Without a breakdown of expenditures, we can't even know for a fact if such a rookie mistake (haemorrhaging investment cash on salaries with no prospect it translates to completed work and thus progress towards milestones) occurred - this is precisely the reason the Kickstarter ToS specify the need for an explanation on failed projects.

Oh and you might want to give them a heads-up that if (ooh, sorry, "when") their invoices ever get paid, they will be subject to close scrutiny downstream regarding what they spend those earnings on.

Kickstarter's terms of service state, verbatim:
[the project creator must be] able to demonstrate that they’ve used funds appropriately and made every reasonable effort to complete the project as promised;

No-one forced Fred to sign up to those ToS.
Whether or not you find those intrusive, saying "we took all your money, and made it disappear on our wages with nothing to show for it" doesn't quite cut the mustard when it comes to accountability and requires a bit more detail.

As for the accountability of freelancers: When I personally was freelancing, I had to account for my time - and my invoice detailed precisely the justification for what I was charging, describing the work done. That was the entire purpose of the invoice, in fact.

If my work (or reckoning for time) was insufficient, it would've been entirely prudent for payment to be withheld, renegotiated or refused.
In fact, not paying contractors on even just a pretext is not uncommon, despite your scoffing.