They said they wanted to keep the cost low because the staff are all volunteering their time to make a wonderful game, so all that's needed is 100,000 USD for 3D modeling and such.
Given the staggering amount of high-profile talent and the fact the Kickstarter is already at 25k though, I wouldn't be surprised to see them pass the 1M mark (and hope they do--multiplayer is a 1.5M stretch goal; would love to see some jRPG co-op in the vein of Seiken Densetsu/Secret of Mana).
EDIT: Quote from the devs
SourceEdited by aramisathei - 8/12/13 at 11:16am
Isn’t $100,000 too low to be making a title of this caliber?
When you think of usual developing fees, USD100,000 is definitely not enough to create a video game. However, as each of our members are professionals in their own field, they do not require a salary right now, and so, are donating their time and effort into developing Project Phoenix. Their reward will come in the fans’ evaluation of the game and a %-based royalty of all sales. This is the reason why our project will never fail due to lack of finance after we reach our goal. It is possible to release our game with just our developers' work, but there is one cost that we just cannot ignore in order to make the highest quality video game. Our pledge, USD100,000 will be used for one of the best 3D modeling out there. This figure is the most minimum cost required.
The money that has been invested through Kickstarter will go towards things such as recordings and hiring extra assistants. The money will always be used solely to enhance the quality of Project Phoenix. This money will never reach our members as salary. Our members are working on this game knowing that they will receive a royalty of the % of income based on how much time they've spent on Project Phoenix.
Project Phoenix aspires to be a video game that solely exists because of the users. So, user evaluation will inherently be crucial to our members' future revenues. If they do not put much effort in, the users' assessment of their work will simply be poor and therefore ultimately reflect badly in the incoming they receive.
We chose Kickstarter because this is where we will be able to make all this happen. There are various exciting rewards ready for you depending on the amount of money pledged. What will the fate of Project Phoenix be? You, who invest in Project Phoenix, will be a true team member. So let's create an amazing game together!