Update:
Nyu Media's Seon has updated Yatagarasu's Indiegogo again, revealing that Paypal has changed their mind and will now release all reserve funds and removing any reserve settings on their account. Seon thanks the fans in Twitter, NeoGAF, SRK and in other gaming sites for their part in convincing Paypal to reverse their decision.
Update Number 2:
Paypal has reached out to us as well regarding the Yatagarasu campaign. We are sharing their statement verbatim below:
"We have reached out to Nyu Media and the issue has been resolved. We want to reiterate that supporting these campaigns is an exciting new part of our business. We are working closely with industry-leaders like IndieGoGo and adapting our processes and policies to better serve the innovative companies that are relying on PayPal and crowd funding campaigns to grow their businesses. We never want to get in the way of innovation, but as a global payments company we must ensure the payments flowing through our system around the world are in compliance with laws and regulations. We understand that the way in which we are complying to these rules can be frustrating in some cases and we've made significant changes in North America to adapt to the unique needs of crowd funding campaigns. We are currently working to roll these improvements out around the world."
Original Story:
Nyu Media founder Seon sent out a distressing update in their Indiegogo today, explaining that Paypal is refusing to release the funds for Yatagarasu: Attack on Cataclysm, nearly a month after the end of a successful crowdfunding campaign.
Paypal’s email explains that they reserved the money, and will release 50 % of the funded amount before Yatagarasu: Attack on Cataclysm is released, and the remaining amount after they get confirmed copies of paid invoices. Seon also explains Paypal is not providing them any opportunity to negotiate, telling Nyu Media to contact them after they’re ready to release the game to get the funds.
Seon does draw comparisons to the problems Lab Zero Games had with Skullgirls extended funding. To be brief, Paypal hesitated to give Lab Zero the said amount, and in the back and forth between them actually froze Lab Zero’s account. You can get the full story here.
However, if I may, the conditions Paypal is setting here is reminiscent of a different crowdfund initiative: Ouya’s Free the Game promotion. The way that works is Ouya pledges to pay for half of a game’s development if they can make at least $ 50,000. Ouya will not pay the developer for actual development; instead promising ¼ at the crowdfund’s end, ½ at Ouya release, and the rest after Ouya exclusivity ends.
Ouya’s promotion did not make sense on its own, so for Paypal to decide at random that Yatagarasu: Attack on Cataclysm should use the same model, without explanation, defies logic. Paypal has been through issues like this before for crowdfunds outside of videogames, and it seems the company just does not trust them in general. As Seon suggested, if you paid for Yatagarasu: Attack on Cataclysm, or just want to give Paypal a piece of your mind, contact them on Twitter here or here.
Source: Yatagarasu Indiegogo
