After a successful Kickstarter campaign, Woolfe: The Red Hood Diaries was released by developer GRIN earlier this year (the Belgian GRIN, not the Swedish Grin that shut its doors in 2009). Yesterday, founder and CEO Wim Wouters wrote on the game’s official website that the developer has filed for bankruptcy and is shutting its doors immediately. Wouters said that poor sales of the game and the unexpected costs associated with an increase in scope during development were to blame:

Why on earth would we want to increase the scope of our game without increasing the budget. Ok, it is understandable that you get inspired to try new things in gameplay, you have to experiment to come up with creative ideas and solutions. I’m not saying the ideas we came up with were impossible. But changing gameplay from 2D to 3D had a major impact on overall development cost (we found out a little too late).

Wouters also talked about the company’s history and its decision to try out Kickstarter, making it an interesting read by itself.

While not losing my passion and still spending every minute of spare time, I generated my basic income doing work-for-hire jobs. Every year the company grew a little stronger, a little better, a little more stable. Until 2 years ago, GRIN had 5 full-time employees exclusively making games for clients, we even made enough money to save a little cash on the side. We would use these savings to create the game of our dreams. Little did we know this would be the beginning of the end.

However, his positive take on the situation turns to worry when he starts to talk about Kickstarter rewards. Primarily because GRIN doesn’t have the money to ship any of the physical rewards.

The people that believed in us from the beginning? People we made promises too. People we have let down. Even worse… people we will not be able to give the full rewards they invested in.

The crazy thing is, that we have most of the rewards ready for postage. All the backer stickers and letters of enlistment just need a stamp. All the poster sets printed, signed and ready. The artbook is ready to be printed, the soundtrack is ready for distribution, the DVD case is ready for production. But we have literally no money whatsoever to pay for stamps, let alone print the artbooks and dvd-cases.

Video game studios shut down all the time. It’s an expensive business, and feature creep is a serious issue for new and old developers alike (see Double Fine’s Broken Age). No matter how big or small the studio, it’s always sad to see someone who entered the industry to follow their dreams have life rip that dream from cold, hungry hands.

It’s even worse when Kickstarter is involved, and people don’t get to have their rewards. On the bright side, the game did end up getting made, and while it didn’t sell great, it got some decent reviews. All backers seem to have gotten their digital rewards at the very least. A continuation of the first game, Woolfe Chapter 2, is currently in limbo, as is the planned Xbox One version.

Here’s hoping those Kickstarter backers don’t feel too burned, and that the developers from GRIN get to continue their passion. For now, the developer is attempting to sell the rights to Woolfe: The Red Hood Diaries (and all the assets created for Chapter 2), so perhaps they’ll get enough to fund the physical rewards at least.