How to handle donations

In this chapter I will be touching what is for many a sensitive subject, donations! A subject that has led to the death of many communities/servers, both by the lack of funds or abuse by the owners. Unfortunately in most cases donations are required in the long run to keep the services up. Before I touch the subject of handling donations let’s make a quick sum up of common expenses for a community, just to give you an insight in what you might need to get before you start.

Expenses

Depending on what kind of services you are providing keep in mind that you will always have bills to pay unless you have access to your own server (with a very good connection) and are able to host everything yourself. However even if that’s the case there is a big chance you will have expenses later down the line once your community is growing and becoming more popular.

Here is a list of common expenses (not all may apply to your situation) split in two sections being “Startup/small” and “medium/large” communities and an extra section which can apply to both size categories.

startup/small community

  • Game server
    • Many companies offer the option to rent game servers. This is what most communities do/where most communities start. the costs are game, slots, company and ticket dependant.
  • Webserver
    • Hosting your website can be free, there are many free web hosts around but if you want to grow your community you will have to invest in a domain extension (.com for instance).
  • Voice server
    • As I have mentioned in the first chapter, having a voice server is important for community bonding. Depending on your choice a voice server can be either free (Discord) or payed for (Teamspeak, Mumble, Ventrillo etc)

medium/large community

  • Virtual private server (VPS)
    • Having a VPS allows you to to host several servers (depending on the requirements) from the same box. This gives you almost full control on what to host.You are able to host gameservers, voice servers and webservers of your choosing (multiple at once). This is a cheaper alternative to the expansive dedicated server option. However, you have less performance and security then a dedicated server “difference between VPS and dedicated server”. Setting up and maintaining your services on a VPS requires knowledge and experience.
  • Dedicated server
    • If your server is demanding a lot of hardware resource, has high traffic, getting a steady flow of donations and if you want full control over your service(s), investing in a dedicated server is the right choice for you. While it is more expensive than a VPS, working with your own dedicated server gives better security, full control and better performance.

Extra

Development costs
If you are going to run custom made game modes or scripts you will need a developer. If you are a developer yourself then Woohoo!! grats to you for now having the hassle to contact 3rd party programmers who 8 out of 10 times abandon the project while taking “their” cut. The costs for hiring a programmer to make custom content variate depending on the scale of the project.

Hardware
If your connection allows you to host your own servers you might need to obtain dedicated hardware to run your services 24/7. And no this category is not about buying 2 nvidia 1080’s with all that $donation money$

Keep in mind that especially during the startup/ first few weeks maybe months you will have to invest your own money into your community, don’t expect to get players and donations from the get go. Now that this is out of the way, let’s focus on how to handle the donations.

Donation rewards

Although this isn’t necessary it will definitely increase your income. By rewarding your donors with rewards they will more likely donate since they will feel special/supportive (which I will talk about in the paragraph “Understanding donators”). There are several ways to setup your donation payment system.

You can choose for the “pay what you want” option where users can decide themselves how much they want to donate to your community. Keep in mind that if you are rewarding your donors ,that the the person who donated $1 get’s the same reward as someone who donated $20. If you start handing out different rewards for different price ranges it will lead to confusion and donators feeling left out.

The most popular are the set price rewards. These rewards can come in the form of packages with multiple rewards or (a single) features getting unlocked. This is easy for both the user and the staff since both parties are fully aware of the rewards and cost. By having several donation tiers the staff can get a good view on what the community wants out of their donation. Be sure not to have too many tiers though, your goal is not to confuse potential new donors.

A growing trend are subscriptions, a system where I personally have mixed feelings about. It’s a really good tool for the staff to see how many people still actively use your services and what their needs are. However when you work with subscriptions it feels and looks more like a service instead of a donation. A very important (if not the most important) aspect of a donation is that they are not paying for something (this will be discussed in the paragraph “Disclaimer”)

Pay to win

Before you start making donation rewards do a thorough research on what those rewards will be, especially when you want to provide in-game items. Personally I fell for the oldest trick in the book and started with item kits which could be reclaimed in-game that were overpowered. Within a couple of days a lot of players started donating in order to receive the same reward which led to a messed up economy. By providing pay2win rewards you make sure your server won’t survive in the long run because it will get a bad reputation. This is very damaging for both the server, the entire community and you as owner. Whenever you made this mistake by accident it is up to you to make things right.

Understanding donators

There are multiple reasons why a player can donated to your community. Player can have both positive and negative motivations to donate to your community.

Positive:

  • The player enjoys your server/community and wants to help where possible to keep the services up
  • The player likes your donation rewards, this means you did a good job setting up the rewards.

Negative:

  • The player wants to feel special and get special treatment
  • The player wants to be part of the staff team

You as the owner/member of the staff team should always be grateful of every donation you get since it will help out the community, but never give donors a special treatment. Players that have donated are not above the law. Be sure to thank your donors to maintain a good morale and image this will reflect on other players who might get inspired to donate to the community as well.

An important rule that you should always remember is that without donations your community will not function in the long run (this affects multiple stats) unless you have separate funds to keep your community up and running for a long time.

Open communication

Nothing is more suspicious than not knowing where your money is going after you have donated. The same goes for your staff members, since they help you handing out the rewards to players they have a sense of the amount of donations that are coming in. Instead of “keeping it a secret” you should be open about it towards your staff team. They don’t have to know the exact number (although there is no problem with it) but you can give them insight. On a previous community the donation transactions were open for all admins to view.

If your staff members start asking questions/giving remarks about the cash flow you can just tell them the facts. Let’s say your piggy bank contains $800 from donations , a lot right? I will break that number down and do a rough calculation on how much a $800 really is for a community with lets say 2 VPS servers hosting all of your services (from a cheap hosting provider). So this is very efficient setup.

Monthly costs
VPS 1 : $45 p.m.
VPS 2 : $45 p.m.
domain $2 p.m.
———
$92 per month

Let’s give those numbers a different perspective, that $800 will last the community 8 months, even less if you have other expenses (giveaways for instance). If your goal is to be a healthy community with a goal for the long run then a couple of months is not a big timeframe. Also, besides the money expect to spend 30 – 65 hours a week on maintaining and expanding your community as a the (single) owner of the community.

Large amount of donations

Once you are starting to see big numbers in your funds don’t get dollar eyes and start buying stuff you don’t need. The first thing you should do is create a buffer for when your community is going through a rough time (it will). Have at least (depending on your costs) spare funds that will last you 3 months. Don’t be afraid to reward yourself (we will discuss this in “What about me?”), your staff and your players (with an extra giveaway).
but don’t forget to always leave a healthy number on your account for the monthly cost.

Invest in the community

The moment when your (main) server is doing great is the scariest one. You reached the point of “what now? It can only decline”. That is the moment when you should look for new paths for your community (watch out that you won’t divide your community while doing this). Let’s say you have a populair Garry’s Mod roleplay server with a healthy stream of donations coming in and with a stable frame of core players. Do some research for a second game server, let’s say a TTT server. This will give your current and new players something else to play under your banner. Don’t approach your new project with generating more donation money in mind. See it as a gift to your current playerbase, ask them what kind of server they want (this also provides community bonding)

Besides investing in a new game server you can also work on your website by adding new features/updating existing ones, or maybe upgrade your server with some better hardware. There are always new ways to improve!

Hosting giveaways

Doing giveaways has a lot of benefits. You will attract new players, promote your presence on social media platforms, interact with your community, community bonding and giving shy players a reason to visit your website/social media.

What about me?

There is nothing wrong with rewarding yourself for all your hard work on your project. However you should not be in this for the money. Once you have built up a healthy amount of revenue you can estimate on how much you are able to claim for yourself, always leave more than enough money in the account so that you will be able to keep paying the bills for at least 6 months. When you decide to take a small cut (yes you have earned it) take only a relative small cut when you are certain you will receive the same amount back within 2 months via income.

Disclaimers

By donating players are not buying anything from you. Make this very clear in your disclaimer which you should always include on your platform. There is also a chance that later on you will need to make some changes to existing donation rewards or add new ones, so always include something like “all donation rewards are subject to change”. Furthermore always add a note saying that by donating you won’t be immune to punishments when they violate a rule. I will write a little example disclaimer which can be placed on your donation page for inspiration or just good old copy paste.

If you donate, you are NOT purchasing anything. After donating for a specific package, the staff chooses to give you the appropriate rank that comes with your donation. The staff gives you this rank in return for your generosity. These ranks unlock [YOUR REWARD HERE]. please note that [YOUR COMMUNITY] retains its right to revoke your access to any and all in-game items and/or from our game server(s) entirely. This includes but is not limited to breaking any of our rules. Every donation you make goes towards the [YOUR COMMUNITY] community, and will be used to keep our services funded. Because of this, we are not eligible to refund your donation under any circumstances. If you do not agree with this disclaimer, do not make a donation. All donations are confidential and will under no circumstance be shared with third parties. [Depending on your system, donations may have to be handed out manually] Also note that donations aren’t automated and needs to be handed out manually by an admin or super admin so we cannot guarantee instant activation.