UPDATE (10/17 9:28):
In response to Masked Twilight’s post on Reddit, Fig’s CEO Justin Baliey replied to the thread shedding light on what he could.
Like to point out this sentence also in our offering circular:
‘Fig’s Board of Directors may in its discretion from time to time pay more than 30% of Fig’s revenue share from Psychonauts 2 to Fig Game Shares – PSY2 holders, if in its view business conditions permit it.’
The 30% is intended to be a minimum dividend amount, and we’ll actively monitor our business conditions to see if we can dividend more than the minimum, but obviously no guarantees.
I’m no expert, but from what it sounds like, 30% is the minimum payout that Fig will deliver to its investors and while they may raise the minimum it really depends on other things.
Masked Twilight replied asking for further clarification on that line saying that it still felt a bit vague and also asked about the excerpt below which says that Fig may reduce the minimum if it felt it needed to.
In all events, Fig’s Board of Directors may decide not to pay a dividend or to reduce its size if the Board believes it will be necessary or prudent to retain such earnings in order to avoid a material adverse effect on Fig’s financial condition or results of operations (in which case the unpaid dividend amount will accrue for future payment), and dividends will not be declared or paid if prohibited under applicable law.
Bailey responded the best he could stating that he was limited in what he could say because it could be considered giving tax advice and that any statement would need to go through a process. What he did say is that the 30% is there to ensure that investors will at least get some money back for their investment. He also said for the board of directors question all dividends are subject to Deleware law.
I’d love to respond in more detail, but we’re heavily regulated and everything has to go through a process, so it makes responding on forums kind of difficult. I can’t respond about tax questions, the[n] I’m giving tax advice, I can’t make certain statements because it could be viewed as investment advice or could be used later as a forward looking statement. Anyway, it makes an active dialog very limited.
I can tell you that the 30% is a minimum that’s there to give investor confidence that we intend to pay at least that amount, and we’re not limited to that, we can pay more. I can’t be more detailed than that because it then needs to go through the process. I can tell you that we have been actively evaluating how to communicate/illustrate this more concisely, and that solution could potentially include altering the minimum for other games since we have to use that in all our illustrations and that seems to be causing a lot of confusion on this point.
A couple things I can point to, on the board of directors questions for instance, all dividend are subject to board approval under Delaware law. I would encourage anyone interested to examine other filings and compare them to our statements. Without that context, it’s easy to draw conclusions and arguments that are largely based on hyperbole.
With Double Fine finally being able to collect funds from investors for Psychonauts 2 the next interesting question other than “when will the game be out” is how much will investors make on the game?
A poster on NeoGAF who goes by the name hollomat crunched the numbers. It turns out the more someone invests, the number of copies that need to be sold to make a profit is lower than someone who dumped a grand into the game.
According to hollomat, who got the info from the SEC Offering Document, which details how investing will work, Psychonauts 2 will need to sell over two million copies at $60 a piece for the investor to break even with a 0% return. Masked Twilight from Reddit crunched the numbers them self and came up with a 2,173,000 figure to break even. Basically, if you invest a $1000 dollars into the game, which works out to two shares, you would receive 1/100th of a cent for each copy sold.
This is much different than what Double Fine predicted last year. Thanks to SiliconAngel, looking at a chart taken from Double Fine’s investment information. With a $500 dollar investment, the game would need to sell around 1.6 million copies at $21 for an investor to see an $800 return.
It’s unclear what changed but hollomat says that this only applies to Fig investors, which make up about 50% of the total investors. It’s interesting to note that the way things are now Double Fine will only need to collect 75% of that 50% for Psychonauts 2 to be fully funded. This is good considering that Fig didn’t require investors to put any money down before they made the investment.
As stated above, this isn’t a huge problem for Double Fine and high-end investors as they need fewer copies to be sold to see a return, but for the average person, this can be kind of alarming. Especially since allowing the average person to share the game’s profits is Fig’s biggest selling point.
Psychonauts 2 is set to come out sometime in 2018 for Xbox One, PS4, PC, Mac, and Linux. You can read about a recent pre-alpha video Double Fine released a couple weeks ago here.