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Paypal vs. Skullgirls

A recent Indiegogo campaign raised over $800K for DLC for Skullgirls, Lab Zero Games' fighting game that's out on consoles and coming to Windows this summer. One of the twists here was allowing contributors to vote for new characters to include in the DLC, which lead to a complication, as NeoGAF has word from Lab Zero's CEO that he could not make his payroll payments because PayPal was withholding funds. EventHubs (thanks GamesBeat) notes that this was due to fear that the voting part of this could backfire and those unhappy with the outcome would rescind their donations: "Basically, they are terrified of chargebacks. If we spend all the money and don't deliver and everyone chargebacks, Paypal is concerned they will be on the line for it. So they are effectively treating it as a loan. I mean, the guy flat-out said, 'Until the threat of chargebacks has passed, Paypal is effectively financing your development'." PayPal has since released most of the funds, but is hanging onto $35K in walking around money just in case they have to make good on some paybacks. Thanks Develop.

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15. Re: Paypal vs. Skullgirls Apr 23, 2013, 18:53 eRe4s3r
 
nhhh, I don't get this news at all. Are they saying they didn't get the money from 1 month back?

They maybe should have waited with this voting until they had the money....

This comment was edited on Apr 23, 2013, 19:01.
 
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14. Re: Paypal vs. Skullgirls Apr 23, 2013, 17:44 007Bistromath
 
Before Paypal did this, very few people would've considered doing that. I mean, who the fuck would? You know that you bought a vote, not the content.

But this drama has put the idea in peoples' heads that they might be entitled to get their money back. They're going to come running. Paypal fucked this.

Considering how often they succeed when they unilaterally just decide to not give you your money, I'd say they did it on purpose.
 
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13. Re: Paypal vs. Skullgirls Apr 23, 2013, 16:45 Raven
 
PropheT wrote on Apr 23, 2013, 14:11:
Raven wrote on Apr 23, 2013, 10:51:
Lab Zero Games:
because people wanted their money back when their voted character didn't make it into the final rounds of voting

Sounds like the contributors are the ones being scummy here. Yeah, Paypal sucks, but what do you expect when your customers start doing mass chargebacks?

...what?

They're holding the money on the chance that people might do chargebacks, not because they were actually doing them.

Read the links. That's a direct quote, and several commenters openly admit to doing it.
 
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12. Re: Paypal vs. Skullgirls Apr 23, 2013, 15:30 Verno
 
Mr. Tact wrote on Apr 23, 2013, 15:29:
And the other processors can't freeze your funds on a whim? They are different how?

They put the money in a bank account rather than some nebulous holding cell beyond any regulation. Sure they can hold up something in process but they can't freeze existing funds that have been cleared. Many vendors who accept paypal funds keep a portion in their account because A) it takes days to withdraw it to a bank account and its better to do it in batches due to fees B) they need to float a balance for fast refunds/etc and C) tax crap that is beyond the scope of this discussion.

Paypal is fine for most people who just buy things online and don't have a problem. You buy something and they take a fee from the seller and you're happy. Paypal's "insurance" is pretty much bullshit though, if you need to dispute things then you'll often find Paypal doesn't really have your back the way other companies will.

For vendors, charities and other organizations it's a much different story and Paypal has weirdly draconian rules that often change on a whim. They also operate much like a bank without the regulation of a bank and I suspect the only reason this continues is the money they spend on lobbying and some other loopholes.

This comment was edited on Apr 23, 2013, 15:37.
 
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11. Re: Paypal vs. Skullgirls Apr 23, 2013, 15:29 Mr. Tact
 
And the other processors can't freeze your funds on a whim? They are different how?  
Truth is brutal. Prepare for pain.
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10. Re: Paypal vs. Skullgirls Apr 23, 2013, 14:52 Beamer
 
avianflu wrote on Apr 23, 2013, 14:47:
What Verno says: PayPal can freeze your paypal account for any reason they see fit and they dont have to obey the laws that banks have to when there are disputes. I wouldnt go anywhere near them myself.

I once had one buyer buy two LPs from me. Shipped them in the same package. 1 tracking number. I'd underestimated shipping costs so it made sense to me.

Then he complained that I didn't send something, and I couldn't prove I did since there was only one tracking number. PayPal froze my account, as I'd already taken the money out, and demanded I pay them back.

I just opened another. Screw that. In their defense, I screwed up. In my defense, the buyer was a dick.
 
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9. Re: Paypal vs. Skullgirls Apr 23, 2013, 14:47 avianflu
 
What Verno says: PayPal can freeze your paypal account for any reason they see fit and they dont have to obey the laws that banks have to when there are disputes. I wouldnt go anywhere near them myself.  
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8. Re: Paypal vs. Skullgirls Apr 23, 2013, 14:29 jdreyer
 
Sucks for Skullgirls. Try to do something cool to involve the player base and get screwed over.  
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"It's just a bunch of mystic bovine scatology to me." - 1badmf
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7. Re: Paypal vs. Skullgirls Apr 23, 2013, 14:11 PropheT
 
Raven wrote on Apr 23, 2013, 10:51:
Lab Zero Games:
because people wanted their money back when their voted character didn't make it into the final rounds of voting

Sounds like the contributors are the ones being scummy here. Yeah, Paypal sucks, but what do you expect when your customers start doing mass chargebacks?

...what?

They're holding the money on the chance that people might do chargebacks, not because they were actually doing them.
 
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6. Re: Paypal vs. Skullgirls Apr 23, 2013, 12:22 Mr. Tact
 
I'll take your word for it. I've probably simply ignored the icons of other processors. I'll try to keep an eye out for them now whenever I'm using Paypal...  
Truth is brutal. Prepare for pain.
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5. Re: Paypal vs. Skullgirls Apr 23, 2013, 12:17 Verno
 
Mr. Tact wrote on Apr 23, 2013, 12:06:
Okay, if I agree that Paypal sucks, is there another electronic pay vendor with similar representation in the market place? I've never had a problem with them, but if I had -- I have no idea who else I might use otherwise.

Amazon, Google Checkout, Authorize.net, etc. I know the big CC companies have their own online versions as well. There are tons of them out there, its just that Paypal beat everyone else to market and is the standard.
 
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4. Re: Paypal vs. Skullgirls Apr 23, 2013, 12:06 Mr. Tact
 
Okay, if I agree that Paypal sucks, is there another electronic pay vendor with similar representation in the market place? I've never had a problem with them, but if I had -- I have no idea who else I might use otherwise.  
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3. Re: Paypal vs. Skullgirls Apr 23, 2013, 11:58 Verno
 
Paypal always does shit like this, they are by far the worst online payment processor. All of the problems of most payment processors with barely any regulation. They should really be forced to operate under federal banking guidelines. There should be a vendor contact and investigation process like credit card companies, not a total seizure of funds the moment a problem occurs.  
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2. Re: Paypal vs. Skullgirls Apr 23, 2013, 11:44 Axis
 
This goes back to eBay who owns Paypal. eBay panders and woos the buyers while routinely fucking over the sellers, and 99% of the time it's the buyers who are mass non-reading fucktards who get away with chargeback bullshit.

Fact.

 
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Yours truly,

Axis
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1. Re: Paypal vs. Skullgirls Apr 23, 2013, 10:51 Raven
 
Lab Zero Games:
because people wanted their money back when their voted character didn't make it into the final rounds of voting

Sounds like the contributors are the ones being scummy here. Yeah, Paypal sucks, but what do you expect when your customers start doing mass chargebacks?
 
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