VCs, Angels, and Beta Pages: They’re wrong

There is a curse afflicting the startup world right now. It’s insidious, it’s harmful, and – as a potential customer – I’m fed up of running into these brick walls of customer-hatred. Each time it happens, yet another startup generates massive harm for itself, and I’d like to see this madness STOP.

(by “startup world” I mean: West-coast USA-style startups – i.e. Silicon Valley VC’s and Angels, the startups they back, the people seeking money from there, and any startup that follows their way of thinking. I do *not* mean – for instance – old-style Europe startups, who haven’t even grasped the idea of a pre-funded “beta” release yet. This post probably will sound new and scary to some of them. For everyone else, this is already standard practice)

EDIT: I forgot (!) to add: when it works, for the startups that use it sparingly, and for the *minority* that are well-suited to it, it works fine. But the current trend is for *everyone* to try it – and that’s where the failure lies. “When all you have is a hammer…”

What are we talking about?

Startups today are advised to build a micro-website with just 1-3 pages that gathers people’s email addresses and does nothing else. This is supposed to show “traction” (in the number of emails captured) and “early lead generation” (by creating a pre-made mailing list of potential customers you can later approach), as well as “idea/product feedback from potential customers” (soliciting opinions from these people by emailing them and trying-out your ideas on a fresh audience – BEFORE spending the money to make the product).

I can’t remember where I first saw this, but its been promoted by a number of major VC’s on their blogs and tweets, and it’s generally seen as a sign that a startup is hip and modern and knows its shit. From memory, it’s been popularized too by things like Y Combinator, Seedcamp, etc – the places that up-and-coming startups go to learn “how to be better at being a startup”.

The importance of courting Early Adopters

First para of wikipedia’s summary on what is an Early Adopter?

Typically this will be a customer who, in addition to using the vendor’s product or technology, will also provide considerable and candid feedback to help the vendor refine its future product releases, as well as the associated means of distribution, service, and support.

Why do we care about these people? Because we certainly do care; we care very much. Startups pore vast amounts of energy into wooing this crowd.

In this context, there’s several valuable uses of these people (

  1. They’re customers: they’ll pay us
  2. They’re “easy sell”: by their nature, and their needs, they’ll buy the product with only a small amount of urging
  3. They’re trendstters: they will do considerable amounts of marketing *on our behalf*, unasked-for, and unpaid
  4. They’re vocal on feedback: they give us huge amounts of valuable insight into what’s good and bad about our product, and what we could/should/mustn’t change about it. Ditto for pricing. Ditto for marketing. Everything, really – they’re like the world’s most friendly and hard-working investor, giving the most honest feedback about the company’s products every single day

Three things on that list shine brightly, and are where old-style startups haven’t caught up yet: these people massively reduce the startup’s SALES and MARKETING costs. A small, lean startup doesn’t yet have the cash to hire a sales team. Nor a marketing team. Also, the founders usually don’t *quite* know what it is they’re selling, or how best to describe it.

These early adopters make SALES EASY, they do FREE MARKETING, and they ADVISE ON WRITING A BETTER SALES MESSAGE. Wow. Awesome!

When Early Adopters Turn Bad

Let’s look at the *second* para of Wikipedia’s description:

The relationship is synergistic, with the customer having early (and sometimes unique, or at least uniquely early) access to an advantageous new product or technology.

i.e. for all that FREE juicy goodness your Early Adopters are giving you, you’re expected (usually: required) to give back, in spades. Usually what you give back is worth more in cash than what you receive – but it’s all about timing. The cash “cost” to you is due in the future, in the long-term product discounts, etc. Whereas the cash “benefit” to you is accrued in the present, in the form of increased sales *today*. And cashflow is the thin that tends to kill startups, so this is hugely valuable for you.

And – unfortunately – these “beta” websites tend to completely ignore the “give back” part of the relationship.

Here’s the problem: if you piss-off the visitors to that micro-site, you generate *disproportionately* large hatred of your company, your team, and your product. Just as an Early Adopter is inclined to tell everyone how wonderful your product is (even though it doesn’t work yet, and they’ve only got a partial version) … they’ll equally tell everyone how terrible your product is (even though it’s not finished, and they’ve only got partial info).

These people don’t conveniently sit around waiting to SERVE YOUR STARTUP … no, they’re people with reputations of their own, with thoughts and feelings. That’s what makes them so valuable – other people trust and listen to them. And that means they’re expected/required to report the bad along with the good. Upset them at your peril.

What does a potential customer want?

When they come to your website, an Early Adopter has a rough pyramid of needs. The more convinced they are of your product – OR the more it seems to fit a problem they already know they have – the further down this list they’ll go:

  1. information
  2. a demo
  3. a service/product
  4. purchase-form

…and they’re impatient, by nature. If you convince them with your first sentence that your product is even ATTEMPTING to fix a problem that’s causing them major pain right now, they may well *immediately* run to your “pricing” link, straight from the home page.

Incidentally … in that case, here is a person TRYING TO GIVE YOU MONEY. You don’t always want their money – it might come with too many strings attached – but, generally, you probably do. You certainly want to consider it, not cut-them off mid-stride and tell them to piss off and leave you alone (which is what a lot of sites do).

It takes two to trade

But lets go back to the most basic need: information.

Someone comes to your site. Why?

You can bet that – no matter what else – they want Information. Who you are, what you’re selling, why is it useful … might they want to use/buy it for themselves?

And here is where most of these beta sites today do a full-frontal face-plant straight onto the tarmac.

Here’s what most sites do:

  1. I won’t let you see the site until you fill in a form
  2. Give me your email address
  3. I’ll show you a webpage telling you nothing, but vaguely promising to contact you “at some time in the future”
  4. The rest of my site is completely empty

This reminds me of The Pirate Code, courtesy Disney:

  1. Take what you can
  2. Give nothing in return

“Synergistic”, says Wikipedia: i.e. a trade, an equivalence: you rub my back, I rub yours.

Only … with these startups, it’s all about TAKING the customer’s info, and then sending them away empty-handed. No wonder a lot of visitors come away with a vague sense of having just been scammed – this is exactly how most con-artists work!

Why? Why, for the love of all that is good?

Not every startup is created equal; if the founder of Twitter, or Facebook, or Google, or … etc … choose to start a new startup now, with a new product, then you can be sure thousands of people will beat a path to their door just on spec of who the founder is. They don’t know what it will be, but they know they want in – if only for the bragging rights to say “First!”.

To a lesser extent, there are startups whose product approaches a need so great, and so tightly defined, and so cutting-edge … that customers will again come beating down the door IRRESPECTIVE of any sense of rationality or sense.

But, for most startups, that’s not the case.

For most startups, if you throw up a “gathering email addresses TRUST ME I’M NOT A PORN-IN-YOUR-INBOX SITE REALLY”, it’s not so simple.

For most starutps, who then use that landing page as *the main funnel for all outside contact*, this is a disaster.

For instance, last week I met a startup co-founder who gave me his business card. Only it wasn’t his card – when I followed the web-address, it proved to direct straight to the funnel for gathering email addresses. Ironically, the site didn’t even have contact info. The founders had linked to their twitter profiles.

(and the main founder had then back-linked his Twitter profile to this funnel site! Way to go, idiot: now there’s literally no way of contacting you directly. I have to @reply you on Twitter and “hope” that you will be gracious enough to a) bother to check your @-replies (since Twitter doesn’t inform you automatically) and b) avoid irritating my own followers with meaningless private messages I had to send to you in public)

Startups: how NOT to write your website sales pages

If your startup sells stuff via the internet (you have an online product, service, web-app, etc), this may be the single most important thing to get right (assuming your core idea, team, etc has inherent merit). And yet so many companies spend so much money doing it so wrong.

Why are modern software companies so bad at selling software? Today I was looking at Scrum tools (or Agile if you prefer), and I was struck by how hopeless some of their websites are. With some of these sites, I am sure that I could increase the sales of most of these companies by hundreds or thousands a year, just through basic principles of sales.

(and, obviously, HOWEVER you design your sales page, you should be using A/B testing to increase sales, conversion, etc. But A/B testing is no panacea: you still need the creativity and understanding to make the “big leaps” yourself)

Example: VersionOne

I’m going to pull out one example (by accident, the first I came across). Many others are much the same.
VersionOne.com

Before we go further, let me be clear what “kind” of customer I am. I’m currently looking for solutions for two commercial setups. One is for tiny projects on a case-by-case basis. This would be 5-seat licenses (worth up to $3000 at VersionOne’s current prices). The other is for a company-wide purchase of up to 30 licenses per annum (worth up to $15,000).

But, at the same time, my last full time job was running development for a large development studio. I was the primary reviewer and purchase-maker for software tools that were 50-person per annum immediately, and meant a commitment of up to 150 within 3 years. I’ve done a *lot* of this purchase-review process, on a lot of software.

My negative reactions to VersionOne’s sales are fairly consistent across the 3 profiles (although the reasons behind that are complex)

Landing page, from Google: the “don’t ask questions, you’re too stupid, just buy instead”, and “we love ourselves, we’re awesome” page

Page: http://pm.versionone.com/Trial_ScrumProjects.html?c-aws=trs&gr-tss&v-029abt&gclid=CNGTgsrEoaICFUcA4wod82WOwg

This has a *concealed* URL, so it pretends to be the front page, but actually lies, and redirects you to this page instead:

Ont this page, your website states it’s a commercial product, yet REFUSES to answer the single most important question: how much does this cost?

There aren’t even any LINKS to finding out about the product. It’s just “buy our product, or piss off”.

This page serves one purpose: lock the customer into a product they don’t want. You are “not allowed” to know the cost, you are only “allowed” to “signup now for a 30-day trial” – you have to commit yourself, and they’ll sting you with a price later, when you have no choice.

Word of advice: merely making something “free, for a few minutes, then I charge you” does NOT lower the customer’s barriers to purchase. For an ultra-long-term product like Project Management tools, it often has the *reverse* effect. The MINIMUM trial for a PM tool is “one project”. Most projects – using new tools – will need several months; 2 week to learn the tool, 10 weeks to run + launch + finish the project. The customer knows this; they know that a “30 day trial” is completely dishonest.

So, we use the navbar, and head to the “Product” page:

Product page: the “Want more info? Oh no you don’t! You’re too stupid, you’re just a customer!”

Page: http://www.versionone.com/Product/

I’ll sum up the stupidity and smug self-satisfied attitude of the person who wrote this page with just one quote, their final bullet point in the top-section:

“Accelerate agile adoption”

[hey! Look at that! I’m so clever – three words all beginning with “a”! They’re guaranteed to buy now! I’m so sharp, sometimes I cut myself]

Sigh. Ignoring the “infographic” which has been screen-captured with a font-size of 2pts (i.e. literally physically impossible to read), we try to do something useful with this page: review the product (we’ve given up on pricing, for now – they obviously don’t wany anyone to buy the product, but maybe the product is so good we can force our way past that?)

Product page, part 2: the “we don’t trust you, we’ll spam you with marketing crap”

Page: http://www.versionone.com/Product/

(below the infographic)

Just look at that page. It has literally zero information about the product, yet it’s the “product” page.

Instead, it has paragraphs of marketing crap. There’s no other term for it; let’s look at the first example.

Bullet-point: “Product Planning”

What does this mean? Absolutely nothing. BY DEFINITION, this is a whole website devoted to project-management-planning software used on projects that create products. Why do you repeat this, in such a childish gross genealization, as if it’s a “feature”?

Ah, but … actually, that’s not necessarily true. Scrum is often used on projects that are NOT generating a Product.

So, in fact, this lazy marketing title has already told some of the target-customers: “Don’t use our product. Go away”.

Let’s look at the text underneath the bullet:

“Plan and manage your requirements, epics, stories, and goals across multiple projects, products and teams.”

What is this – Dictionary.com? Why are you patronising me by telling me what you think “Product Planning” means, as an abstract concept? What kind of project manager – or engineer – is so stupid as to not know what it is they do on a day to day basis, and to feel happy that you’re telling them?

I WANT TO BUY YOUR SOFTWARE, NOT LISTEN TO YOUR PHILOSOPHICAL DISCOURSE.

I suspect that the weak marketing person who wrote this copy thought it “looked nicer” to put features into a long sentence. Let’s look at that sentence, from a copy-writing perspective. It has eight separate phrases. EIGHT. The average sentence has 2-4. Concise sentences have 1-2. Waffle has 5 or more. This is a sales page; every sentence should be no more than 3 phrases. EIGHT! NO-ONE is going to pull useful information from that sentence.

Onto another problem with this page, for the customer who comes here: No screenshots. Anywhere.

OK. Take a deep breath. This is a company that, so far:
– wants to deceive us into locking-in to their product
– patronises us intensely
– works hard to hide features (check that “unreadable” infographic)

…but let’s put all that to one side, and drill down into the links from the Product page.

Features (1 of 8): “You can look, but don’t touch AND DON’T LOOK CLOSELY!”

Page: http://www.versionone.com/Product/Product_Planning.asp

Finally, if you follow one of the links from this page, you get to a page that contains some actual, concrete, info about the product. There’s even some screenshots!

Oh. BUT. You are “not allowed” to actually see the screenshots. They’ve been deliberately blurred-out a low-resolution, so that text is literally unreadable and there is NO WAY to judge the product. (NB: this is *after* you’ve clicked on the almost-full-size thumbnails in the page). They are then further blurred (to no purpose except to fit the Web Designer’s fetish for popup images) and embedded in the page.

Overall impression: this company knows it’s own product is not fit for purpose, and will do anything to stop the customer from finding that out until AFTER they’ve paid their money. Whatever you do DO NOT BUY VersionOne’s project-management software.

Final thoughts: First one is free

A decent usability person – or a really good web designer – would make huge sweeping changes to that site.

A flippant starter, something I’d personally try immediately (today): move the “see it; drive it; try it” buttons that hide in top-right of the site to CENTER STAGE, both on the Product page and the Google Landing page.

AND … I’d add a fourth button: “Buy it”.

What? There’s no “buy” link on this site? Yep. I think that eloquently sums up what a poor job this site does of MAKING MONEY FOR THE COMPANY.

(NB: and I *absolutely* would instigate A/B tests to prove – day by day, hour by hour – that my changes were having a noticeable effect on increasing sales to the site. If you don’t do that, then you’re just pissing into the wind. You have no idea, afterwards, whether your changes “worked”. See Sergio Zyman‘s book for more…)

Where do these terrible sites come from?

I believe that these often-amateurish websites come from one of two sources (possibly both):

1. Expensive “Web Design” agency that only cared about making it “beautiful” without understanding a single thing about the reality of sales. In the example I run through below, dead giveaways include: Popup images that are only 15% larger than the thumbnails that trigger them; grey-on-white text; very small font-sizes. All those are characteristic of visual designers who know nothing about product sales.

2. A marketing team that’s worked for big corporates (multinational, public companies) and thinks that the most important thing in their job is to “clone” the website of “a real company – you know, like Microsoft”, and pretend to “be like the big boys”. They have no idea why those websites look the way they do, and don’t bother to ask themselves; they just blindly clone it. In the example below, dead giveaways include: 12 pages to describe a simple product where 3 would have been more than sufficient; hiding information at all costs; never committing to a list of features; using “freeform text” instead of simple “bullet points” to describe the product.

“Developers outsource publishing to publishers”

Nicholas Lovell suggests it here:

Think about it. It’s your baby, your dream, your idea.

My own way of describing this is:

  • Who owns the IP? (dev, initially)
  • Who invented the IP? (dev)
  • Who – therefore – understands *why* the IP exists, *how* it works, *why* it’s “good”? (dev)
  • Who cares most about the IP? (dev)
  • Who would you trust most to pour their heart into making the most of the IP? (?)
  • …and do so without destroying the bits that made it good and unique in the first place? (?)

Years of publishing have made people come to assume the answer to the last questions is “the publisher” without even thinking about it. It took me very little time working in actual publishers to see first-hand how wrong that is as an answer – in most publishers, most of the staff don’t even play games. At all. They couldn’t care less about the IP’s they are supposedly shepherding and exploiting.

When you speak to people who know nothing about the games industry, they invariably answer “the developer”, as this is the natural answer: the person who invented and nurtured the answer is bound to care more about it, and work harder for it, than anyone else.

These days, now that I believe in hiring on enthusiasm instead of competence, that’s also the answer that will tend to maximize “success” / revenue.

Valete, Publishing industry!

GetClicky sucks: an Analytics service going out of business?

A year or so ago I did a roundup of the major free Web Analytics services. I was interested to see how Google Analytics had affected the market: was there a market left any more?

One of the trials I signed up for I found so useful I carried on using after I’d written the review. GetClicky had a lot less information than some services – including GA – and less detail than the free tools I already run on all my websites (e.g. AWstats). But it was a lot more user-friendly, presenting the most critical information all at once on a single screen.

Today I finally started disabling GetClicky on my sites; the company has forceably blocked my site from their service. Why? Because I had a week of heavy traffic *while I was using the premium version which allows unlimited traffic*. That’s it. I stayed within their requirements, but I was banned anyway. That suggests to me that their company is in trouble…
Continue reading “GetClicky sucks: an Analytics service going out of business?”

Focussed work-hours, and the Studio Manifesto

David Sirlin’s just done a writeup of Flashbang studios recent experiment with work hours:

“The first part of their theory is that we really only get about 2 hours of seriously focused, amazing-quality work per day–if we’re lucky. Maybe you can get 2.5 or 3 sometimes, but that’s pushing it. There are so many distractions and blockers, so many times when you’re too tired or hungry or upset about something, or whatever. Flashbang is saying just be real here: accept that you’re only going to be able to do amazing work for a short time each day. Knowledge work as it’s called, is the type of thing where you could spend 20 hours on a problem and not solve it, but just *one* hour of your fully charged genius-time could solve it.”

Unfortunately (tragically!), David’s set his blog to be “no comments”, so there’s no public followup discussion (you can try registering in the forums. On a different page. Not even linked. Have fun with that!)

There are serious flaws with taking general conclusions from this experiment – as someone from TCE pointed out, there’s probably some Hawthorne Effect going on – but I think it’s an interesting data point to add to the game studio manifesto. Specifically because it’s from a games company, and the particular set of changes they experimented with is different from most of those we’ve seen tried before.

So, who’s going to buy Zynga?

(for the three people who haven’t heard yet, EA just bought PlayFish, for circa $400 million)

Three things I have to say on this:

  1. Mainstream games industry people question it’s value
  2. Yes, of course it was worth it
  3. What Would Zynga Do?

Mainstream games industry people question it’s value

I’ve seen a lot of people from the mainstream industry (i.e. consoles, PC games, handheld etc – eerything EXCEPT iPhone and Facebook) incredulous, unconvinced it was worth it. This was the case even with the rumoured $250 million valuation from a month ago (c.f. Nicholas Lovell’s post on that).

There’s also some discussion over at TheChaosEngine (private forum for professionals in the games industry) on the same topic, with similar levels of scepticism about the value.

The main reference points are traditional games companies and their sale prices. That’s where this goes wrong – and it’s symptomatic of something that hampers the games industry: a lack of understanding of the business side of games. For most people in the industry, this doesn’t matter – they’re making games, not selling or funding them. But for the people managing games companies, far too many of them need to get an MBA and learn the essentials of sales, marketing, revenue, and shareholder-value – and how that applies to their own day-jobs.

Yes, of course it was worth it

Reproducing some of what I’ve already written on TCE, since it’s non-public:

There’s three things driving the valuation of PF:

  1. A solid business, in business-terms (c.f. Nicholas Lovell’s “6 reasons why Playfish is a steal at $400m”)
  2. Quality content-producer, in games / media terms
  3. Consistent success, in comparitive terms

Playfish is in the top 3 companies dominating the Social Games sector. They are the ONLY one of those companies that set out to dominate the SG sector – the other two happened purely by accident. PF was architected to take over this sector, and is succeeding at it.

From a game-design perspective, the entire business model for Zynga and SGN has been “keep bailing!”, and they’ve so far bailed faster than they were sinking (where “bailing” means “using marketing and sales ability to make up for severe product deficiency”). That might sound like I’m being derogatory – but compare it to all the “worthy” games companies who bailed *slower* than they were sinking; at the end of the day, who’s the smart one?

But good sales/marketing strategies are easy to dissect and clone, in a way that good content is not.

Part of the demand for PF is that a lot of people look at it and say: this is SGN/Zynga, except they make good games. Yes, they’re not 1st – but any idiot could take PF’s current position, throw $50m of marketing budget at it, and easily surpass Zynga. They will own this market, sooner or later – PF is fundamentally strong where Z is fundamentally fragile. (although Z’s “fragile” is still an order of magnitude stronger than most traditional games companies).

Just to be clear: I have a lot of respect for Zynga and SGN, they’ve achieved a heck of a lot. But they’re sharks. They’ve always been sharks. Comparing to modern standards of game-design, they’ve never had great product. Instead, they’ve been extremely canny, aggressive, vicious, and cash-driven – and they’ve shown how successful and profitable you can be with those things. If someone had asked “how well can you do with a weak content company if you’re exceptional on the business-side?” then these companies boldly step forth and demonstrate that the answer is: “very well indeed”.

But this is a new, novel market. Maybe there’s nothing special about PlayFish?

Well, apart from thriving in a new market against some of the toughest competition in the world, look at the comparitives. Compare PF with – say – Kongregate. That was founded by the ex TD of Pogo after years at Pogo/EA, and was expected to recreate the success of Pogo and expand on it (hundreds of millions of dollars revenue). They’ve fallen a long, long way short. PF was founded years later and is now doing perhaps 20 times the revenue (just guessing based on Kong’s last funding round and how long ago it was).

PF’s success *looks like* it’s “probably” no accident. IIRC (and I haven’t checked, I’m going from memory here, so I might be very wrong) this is the same management team that built and later floated GluMobile. Putting that into perspective:

  1. these guys have ridden the wave of an emerging market to create on of the big successes
  2. these guys started from nothing and ended up with an IPO
  3. these guys then started all over again, from scratch, in a new market … and succeeded AGAIN.
  4. …and they did it very quickly

What Would Zynga Do?

This, then, is the million-dollar question: who’s going to buy Zynga?

Zynga have followed a strategy of buying-or-burying every small competitor who came along. As I noted above, despite being rich, hugely successful, and growing fast, they have some internal fragility that PF has never had. Where PF *could*, in theory, get more aggressive, Zynga is already barrelling along flat-out on that front. Where PF has a good reptuation they can trade on, Zynga has a poor one that’s not worth much now PF is part of EA.

If it had been a smaller company that bought PF, maybe – maybe – Zynga could have afforded to try a reverse-takeover to hoist themselves up, and hold on to their top spot in Social Games.

But EA/PF is too complementary a pairing; together, they’re too effective for Zynga to get away with that. Zynga *might* have hoped, with a different competitor, that acquisition by EA would lead to a breaking-up of the company’s value. EA has done this many a time to other acquisitions: small companies vanish when eaten by big ones. But as I noted above (and as Nicholas referred to when claiming that PF’s team could “turn around the tanker” that is EA), PF’s team have enough experience and personal wealth that it is very unlikely they’d disappear inside EA. They *might* retire (despite the golden handcuffs, many EA acquisitions have lead to de-facto retirement of their founders) – but PF is so young as a company that I doubt they’re tired of it just yet.

Looking back at Zynga, this seems to be a company that sees itself as the Alpha Male. I can’t believe they’d settle for second place. So, Zynga needs to be bought. And, unlike PF, Zynga may actually benefit from being dominated by their acquirer (try and wipe out some of that bad reputation; perhaps fundamentally alter the internals of the business, make it into a good content-generator? Where PF is adding Zynga-esque marketing and sales ability, could Zynga add PF-esque content-creation/content-quality ability?).

Who?

I’ve no idea :).

But, looking around, Zynga has greatly underperformed on iPhone. There are a lot of media and consumer giants around that expect to have no problems making lots of money on iPhone. Maybe that would make a good deal, someone already exploring, or set to explore, iPhone, who doesn’t need Zynga, but who could expand Zynga on to iPhone in a huge way. That could even let Zynga save some face in the deal (“there’s nothing about our business approach we wanted to change, it’s just that this was an opportunity to dominate TWO platforms instead of ONE”).

How to FAIL, from the world of Open Source: Eclipse

The problem

It’s a great piece of openness to put your bug lists in the public domain. It makes it easier for your customers and partners to make decisions that save you time because they can see what’s coming and when (and save you money in reduced support requests). It saves you money in that you get free QA / testing from your users.

The downside is that it exposes to the world the places where you are especially incompetent, lazy, or just plain self-centred.

This is a recurring theme I’ve seen with corporates looking at both Open Source and also Web 2.0:

We say we’re the best, but secretly I believe we’re the worst; if we expose ourselves to the public, people will ridicule our mediocrity, and refuse to do business with us.

Also … I will probably get fired because my colleagues and my boss will finally realise what a clusterfuck I preside over on a daily basis

Eclipse, and a tale of two bugs

I was going to log two high-impact bugs that Eclipse has had for several years. Then I did a search on that area of Eclipse, and realised that the current Eclipse maintainers don’t give a **** about this whole section of the IDE – some of the core bugs we see every day were logged in 2001, and are still open:

https://bugs.eclipse.org/bugs/buglist.cgi?query_format=specific&order=relevance+desc&bug_status=__open__&product=&content=syntax+coloring

What you find when you do some basic research

If you go looking through the bug history for some of the more “obvious” bugs there, you often find little gems of passive-aggressiveness from maintainers. That’s an exceptionally effective way of making sure people stop helping and supporting any Open-Source project…

You’ll also find endless re-logging of the same old bugs from 10 years ago, revolving around the basic problem that Eclipse lets you set everything you could possibly imagine … EXCEPT the colours that it prints text in.

(all IDEs let you set the colours; most dont give you enough control over the other parts; Eclipse fails on the basic challenge, and succeeds on the advanced challenge)

This wouldn’t be so bad, except that its default is very bright with low-contrast – i.e. very hard to read on laptops when outside, and bad to read for long periods of time. As of about 5 years ago, you are finally “allowed” to set the colours yourself – except that the app breaks if you do, because they “didn’t bother” to allow you to change the colours on 20% or so of things.

Final thoughts

The next time someone – especially at a corporate – resists openness and transparency … in any form … ask yourself this:

What have they got to hide?

Often, once you ask yourself that question of the right person at the right time, it very quickly becomes obvious what they’re hiding (if not why). A little more digging, and you can pry open the can of worms, and see what trouble they’ve been up to…

(Incidentally (and unsurprisingly), in the face of the point-blank refusal of Eclipse developers to make basic usability concessions across the board, I didn’t bother logging either of the two bugs I’d found)

What I believe in, for Quality of Life

The furore[link] over the IGDA’s failure[link] to live up to it’s own precepts continues to snowball[link] [link] (as I suggested it would, if the IGDA Board didn’t ‘fess up and take a stand[link] against the unethical practices they were being implicated in).

(I’ll do a summary later this week; personally I’m aware of 6 different unique forum threads and several separate bloggers speaking out on the topic, each with their own comment threads – we’re gradually seeing the message spread, which is good. But it also means it’s getting hard to keep up)

One commenter, perhaps playing Devil’s Advocate for those at fault, has repeatedly posed the question: “What would you *like* the IGDA’s stance to be on this topic?”

There are all sorts of reasons that’s a dumb thing to ask, and it essentially misses all the points being made here by the unhappy IGDA members, but I thought it was a good question to answer anyway, philosophically.

Quality of Life for the Games Industry: Adam’s stance on “Crunch”

NB: this is only covering the crunch/working hours/overtime issues; there’s more to QoL than that, but it’s definitely the headline aspect.

(and hopefully you’ll also have a look at Darius’s stance on this and other related topics, since he’ll be standing for election to the IGDA Board next year, and he’s got my vote already ;))

  1. the term “crunch” is a euphemism for “unpaid overtime” used largely to disguise the true nature of what’s being described. No-one should ever use the term “crunch”. Everyone should actively encourage others to call it what it is (unpaid overtime). “unscheduled overtime” is NOT an acceptable alternative; it is simply another, slightly less positive, euphemism.
  2. no employer gets an opt-out from responsibility for Quality of Life issues, neither charities nor startups. Quality of Life is about the relationship between employee and employer, independent of individual industries, organizations, or projects
  3. the company must at all times actively discourage staff from doing unpaid overtime; if the company wishes to support overtime, it should be supporting *paid* overtime only
  4. no programmer, artist, or designer should ever stay late in the office “because it’s quieter then, and I can get more work done when everyone else has gone home”; if the office environment is that poor, the company needs to fix it, fast
  5. the MOST EFFICIENT (for the company) number of weekly office hours for programmers, artists and game designers lies somewhere between 30 and 50 hours a week.
  6. the MOST EFFECTIVE/DESIRABLE (for the employees) number of weekly office hours for programmers, artists and game designers lies somewhere between 20 and 60 hours a week.

Why does this even matter?

Most workers in this industry live to work, instead of working to live; this makes the industry especially prone, and the employees especially vulnerable, to abusive employment practices.

It also means that – handled correctly – most people ought to be happy and healthy. This topic has the potential to improve the lives of thousands of people; that it will almost certainly also improve the quality of the games they produce is a secondary (although highly desirable) side-effect.

Details / explanations

1 – Terminology

Cynically, I’d like to point out that to many young males (the bulk of the workers in the game industry), the term crunch probably initially conjures up images of the painful gym exercises that build the widely desired abdominal muscles.

i.e. the base assumption of an English speaker is that Crunch is something that “hurts now, but is good for you, and in the long run you will appreciate it”.

Actually, I don’t think that’s even all that cynical, looking at the companies that actively use the term: I think they’re extremely happy to have got such a positively-connotated word used as the main term to describe their unethical business practice.

2 – Opt-outs

Several people (such as Erin Hoffman (EA_Spouse) EDIT: my mistake – sorry, Erin! – see comments below) have claimed that startups are “special”; too fragile to be held accountable to the same standards that ordinary companies are held to; that they could never adhere to sane and ethical working practices and remain in business.

As a previous founder, co-founder, or C-level exec in 5+ different startups, and a consultant or external adviser for a further 20+ startups, it is my personal opinion that this is absolutely not true.

Further, I believe it is deeply insulting to most entrepreneurs to imply that they are so incompetent that they need to be allowed to break with ethics or law in order to succeed. The majority of successful entrepreneurs I know are awesomely competent people, and have earnt (*earnt*) their wealth not merely through “having a good idea” but through being better and smarter and wiser than their equivalent salaried employees. They need no leg-up.

Of course, there’s also plenty who simply got lucky. But that’s another story.

3 – Working late in order to work better

There are two issues here.

Firstly, if someone is doing unpaid overtime, the company needs to either reward it or try to persuade them to stop; anything else is unfair. Simply taking the proceeds of the free work and paying nothing in return is perfectly legal (although arguably, since the work falls outside of the contract, if the company’s employment contract isn’t good enough the company could find themselves not entirely owning the output of that work), but unethical.

Secondly, unless the employees have strong legal protection against coercion (both explicit and implicit) then the claim that staff are “voluntarily” working unpaid overtime is often going to be a lie that – in practice – is almost impossible to uncover. A nice, comforting lie, but a lie all the same. I have many times worked with people in the games industry who have openly claimed their unpaid overtime was voluntary – until they buckled from stress a few weeks later, or got drunk, or met up outside the office, and admitted the true reason(s) they were doing it. Generally those were “to keep my job”, “because everyone else on the team says I have to”, or a variant on those. i.e. to satisfy the employer, or to satisfy peer pressure.

This is true even in Europe, where employees have fairly strong legal protection – but in many cases don’t realise the full extent of the protection. Generally speaking, only the inexperienced, younger staff are ignorant of the basic laws here. Within 5 years they normally see at least one friend or colleague go through some situation which uncovers the laws involved, and they gain a basic understanding of what their own rights are, under the law.

4 – Optional isn’t always optional

I’ve worked with many programmers who felt forced to work late hours because of this, and a few artists. I haven’t worked with any designers yet who were *seen* to, but I know plenty who have done it – they simply went home and worked from home instead.

The main reason programmers show up with this problem more than others is that they are entirely dependent upon the tools at their desk to get any work done (software, hardware, office systems, etc). It’s *not* that they are the only ones who work hard and have to concentrate to get good work done!

5 – Efficiency

As far as I know (please correct me!) … no-one currently knows via research what the MOST EFFICIENT weekly office hours are for programmers, artists, and designers in the games industry; the research I’ve read summaries of, and in a few cases read myself, from other industries and anecdotal evidence, plus the experience of skilled game developers, suggest that it lies somewhere between 20 and 40 hours.

Further, the majority of research from other industries and evidence and experience strongly support the claim that values over 60 hours are less efficient than ANY value between 25 and 60 hours.

6 – Quality of output, quality of life

As far as I know (please correct me!) no-one currently knows via research what the IDEAL (for the staff work/life balance) weekly *working* hours are, but assuming 14-16 waking hours a day, i.e. 70-80 waking hours a week, and assuming a work/life split somewhere between 30/70 and 70/30, you get between 21 and 56 working hours per week

Culture, Reputation, and Running a Game Studio

What’s the biggest single challenge to a Studio Director? Or to the VP of Development / Studios who oversees a handful of publisher-owned studios?

Recruitment

In the games industry there are no raw materials of variable quality, there is no variety of base services to build upon; everything that distinguishes one company (and set of products) from another comes solely from the people they hire.

In the games industry there are no raw materials to pay for, there are no service charges. There are only salaries and employee-support costs.

Recruitment is where the studio heads find their hardest problems, and see their biggest successes/failures as the studio grows in size. Eventually, all their own experience and ability at design, marketing, sales, programming, art, etc become subsumed by their ability to attract, recruit, retain, lead, and motivate their people.

Recession

…is the best thing for new game studios to happen in the past 5 years. It’s achieved four things:

  1. Removed lots and lots of people from their comfortable jobs, by force
  2. …simultaneously…
  3. …indiscriminately w.r.t. quality of personnel…
  4. …and made even the supposedly “secure” games companies (EA, Microsoft, Sony) suddenly look as fragile and short-term as the riskiest of startups

The VCs have been blogging about the benefits to startups wrought by this recession, and I’ve put it to a couple of them now that, for the game industry, this one – recruitment – is the biggest by far, and each time met with straight agreement. Our industry is very like Management Consultancy: it’s driven by the people. Nothing else matters.

Culture

I’ve worked with a lot of experienced managers who’ve been adamant that “no-one leaves their job because of (too little) salary”. Also with slightly fewer who were convinced that “no-one accepts a job based on salary” (more often, that was rephrased with a rider to be: “no-one good accepts a job based on salary alone“).

In that case, why do people accept / leave a job?

“Culture” is the catch-all term that describes not just the direct environment which people experience each day in the office, but also the emotional and psychological experiences that they go through while there.

It describes how their colleagues think and act – and how those actions effect the individual. But it also describes how the “teams” within the organization think and act, which can often be very different from the people within them. You often see teams of smart people “acting dumb”, or teams of nice people act like assholes when taken collectively. Group think is powerful, very powerful.

But it’s hard, very hard, to really see the culture of a company until you’ve worked there for a couple of years, and in a couple of different divisions, and perhaps a dozen different departments. Which is not an option for most of us. You can work somewhere for just a few months and pick up the culture if you know what you’re doing and really work at it – but even that requires skill and dedication, and can only be done AFTER accepting a job offer.

(this is one of the reasons I posted my Manifesto for a Game Studio online – you can get a strong taste of the culture of my next startup, and decide if you want to work with us, without having to sacrifice a year of working there first)

Reputation

Game industry staff often worry about reputation. The companies (as represented by the senior management) themselves often don’t.

The former care how their organization is perceived, and assume everyone else does too. They assume that a “better reputation” will lead to “more sales”.

The latter have access to the actual sales figures, and have convinced themselves that this is a nice idea but simply not borne out by fact (in some cases this is true, in some it isn’t – but it’s much easier to look at the figures on paper and believe it’s true than to see the flaws in that logic).

But the truth is that it IS important, very important. It’s the external reflection of the internal culture. As such, it’s what most people use to make a decision about whether they want to work there.

Obviously, it varies. The older and more experienced you are, the more you come to use a company’s reputation as a barometer of its culture – and the more heavily you weight this in your decision about accepting a job. The younger, more ignorant staff generally haven’t been burnt by terrible culture, or haven’t yet learned what to look for / avoid in their next employer.

Back to the issue of Recruitment: the biggest successes/failures are going to be from the more experienced people you hire (and, remember – hiring a “bad” person into a senior position is not just a loss, it can easily cause negative productivity, by screwing up lots of other staff who were doing their jobs better before that person arrived and started interfering / roadblocking them / etc).

So … you probably should care about your reputation, somewhat in proportion to the size of your company.

Blizzard

Pre-WoW, Blizzard had an exceptional reputation, for a handful of common reasons (amongst others):

  1. Never shipped a game that wasn’t really good fun
  2. Frequently invented + defined large sub-genres with their games (Warcraft was one of the first RTS’s, Starcraft created the “truly strategic” RTS genre, Diablo re-invented the hack-and-slash RPG, etc)
  3. Publicly talked about “finishing” their games, and then deliberately deciding to spend another whole year (or similar) working on them before shipping, to make sure they were really polished
  4. All of their games were best-sellers – i.e. they didn’t just make cool stuff, they made cool stuff that the market appreciated and paid for, too

Now, I’m not so sure. If a recruiter called me tomorrow with an “amazing, once-in-a-lifetime opportunity” to work at Blizzard, my first reaction would be hesitation: would I really want to work at the place that Blizzard has become?

While people have queued up to defend them, the history of their actions against Glider, and now this absurd crackdown on World of Warcraft add-on authors, have left me with a sour taste in the mouth.

In my opinion, using the law to beat over the head people who discover flaws in your basic business model / acumen is the last refuge of those who recognize their own incompetence but would rather not go to the effort of raising their own quality bar. Blizzard seems to be making a habit of it. That’s not encouraging. Ten million paying players for one MMO is great, but … the sales figures of their games were only ONE of those bullets I cited above about Blizzard’s reputation traditionally. Money buys a lot of forgiveness, but not infinitely so.

Free iPhone developer meetups

I just received an “invite” to a pay-for event in London about “smartphone development”: an evening in a bar with a couple of speakers and some networking.

So … you can go and listen to an iPhone developer, an ex EA person, and an ex Motorola person, and pay for the priviledge, organized by non-developers. The cost is 50% more than you pay to go to world-famous VC/angel/investor networking events such as First Tuesday.

Or … you could go to one of the many near-identical networking + speaker events that are free, and run by real developers. Here are four examples which show that Upcoming, meetup.com – even Facebook and LinkedIn – are your friends here, with loads of stuff going on.

The issue of “how” you organize these things and “what” you provide has been on my mind a lot recently, as we’ve just started a fortnightly one in Brighton (for anyone and everyone interested in commissioning, designing, developing, and launching iPhone apps). I’ve been trying out all the above sites for arranging this (I can write up some notes about the pros/cons of the different sites if anyone is interested). If you can’t find something in your local area … why not start one of your own, all it takes is making a page on Upcoming.com, and emailing the local game / mobile / iphone / OS X developer communities … takes about 30 minutes, max?

Personally, I find the grassroots events organized by people actually making this stuff on a daily basis the far more compelling option. I also find that “special name speaker” events tend to focus on the audience being expected to shut up and listen, rather than share and learn collectively – which isn’t much use to me these days. Unconferences for the win!

Of course, sooner or later, if your event gets popular, you’ll have to start charging because the only venues big enough require large payments, and the organization effort becomes too much to do in your free time. But for the small events? My advice: if it ain’t free, don’t go.

Pragmatist’s view of Corporate Culture?

The IGDA Leadership conference 2009 just launched their call for speakers.

The form is pretty brief, so I wrote some personal notes on what I’ve just submitted (so I don’t forget if/when they accept the talk!). It just occurred to me that a large percentage of my blog posts are, essentially, about Leadership in companies (anywhere) and the game industry (specifically). So, I’d be interested in any comments on this skeleton outline.

1. it changes your reputation
* your reputation is the biggest influence on your hiring-applicants
* your business is based mostly on people (games industry specific!)

2. it changes your collective happiness
* unhappy people do different things: cause problems, stop working, stop caring, suicide-by-cop
* happy people: … be the best tehy can be

3. culture is formed by perception
* it’s not what you say, it’s what you are NOTICED to be doing

4. internal and external culture
* they improve and sink independently
* …but one can pull the other up (or down)

5. changing culture
* very steep change-curve == very hard, but then … very sudden massive improvement
* starts with: who are you going to fire?
* c.f. “perception” of belief, not the statement of it

6. cultural “tells”
* what does your employent contract say?
* what is “a manager” in your org?
* how are projects structured in terms of people + human-roles?
* how much do you pay?
* what does the man-on-the-street think you are?
* what do you do when times are hard? (hard questions, hard problems, hard money problems, etc)

7. shining examples
* e.g. this

8. flaming failures

A game dev studio made of Graduates

Someone emailed me recently to say he’s setting up a new game development studio, and that (for various reasons specific to his situation) the company will consist of around 90% recent university graduates. Without asking for details, I can make a pretty good guess that there’s government funding involved – I’ve previously seen grants aimed at game studios with similar constraints everywhere from the UK to Singapore. Probably this one is tied to a local University (that’s another classic government thing, especially in the EU: grants that have to go to “industry/academia equal partnerships”).

As he says, it’s an “interesting” challenge. Oh, yes. He invited me to blog about it (yes, I know – it’s a way of avoiding paying consultancy fees, but what the heck), so here’s some thoughts. At least this way I can record/archive some of what its like to be a recent Graduate before I get so old that I completely forget where they’re coming from.

(I’m not a recent grad, but I’m not yet old enough to have forgotten being one)

Where do you start?

In the past, I’ve seen people start with the management team. Then move on to the senior staff (hey, he’s got 10% of the company to play with), decide who’s needed, fit them to potential projects, etc. And finally – working with all of those people in place – finding and hiring all the Grads.

But … my first inclination would be to play to the strengths and weaknesses of the majority of your staff. In a brand-new startup with a team that don’t know each other the influence of each individual on the overall success/failure is disproportionately strong. Over time, as things become more settled, influence starts to becom proportional to seniority, experience, and knowledge. But not initially.

i.e. in this case the graduates.

Graduates

In my experience, graduates everywhere (including at least some parts of Asia, although I’ve mostly experienced Koreans not Chinese) are young, naive, eager, foolish, and fearless.

Specific universities mould their grads into having a very different set of characteristics, but assuming you’re picking bright, interested people, then those 5 are always present no matter where they schooled.

Personal Projects

They thrive on being given their own little projects that are their total responsibility. I think this is driven by two things, certainly in tech. Firstly, a fear of becoming the invisible cog in a giant machine that all adults have appeared to be to them, at a time when they’ve only recently found themselves and found their own uniqueness.

Secondly, I think most grads find University is the first time they start to experience personal responsbility, a move away from the family, no longer entirely dependent upon (and sheltered by) their parents. Some people become very independent during uni, others only just dip their toes in the water while there. In most countries, uni straddles the age of majority, and grads find themselves starting to be treated as adults by their society – one of the biggest parts of which is the expectation that they will take personal responsibility.

Clone Wars

I think a lot of people in this situation feel tempted to embark on a clone of a known game. The idea is that this will make up for the lack of experience by obviating the need for decisions on key game design and implementation issues: you don’t have to think, you just just play game X an extra time and “do whatever they did”.

That can work. As a recent example: so far as I can tell, it’s what a lot of the early F2P Chinese developers did – cloned Korean F2P games and just tweaked the “shallow” content (story, plot, theme, geographical location, etc – all the non-programmatic stuff). They’ve all done very well out of this.

However … as soon as market expectations ramp up, cloning becomes extremely difficult. You cannot afford to get “stuck” because you can’t figure out “how” the original game achieved something. With a team of veterans, you have an encyclopaedia of knowledge of techniques in their heads, and usually for each trick the original developer used at least one person on your time already knows that one. Where that doesn’t work, all your veterans each have a bag of tricks and hacks and band-aids that they can use to fudge it; nothing will slow them down for long.

(incidentally, China is probably well into the secand wave of MMO development by now, meaning that new studios there have no chance of doing the “clone + make lots of money” route; the developers that did that are now worth billions of dollars, and they’re already pushing the minimum quality bar up very, very high)

In the end, I think cloning is a bad fit for a bunch of grauates. If you get the timing just right, they’re a very cheap workforce to do it with, and they have too little self-esteem to object (see below). But at any other time, it plays on their weaknesses, and invalidates a lot of their strengths.

What graduates are good at

Grads are great for churning out large amounts of repetitive content. To them, everything still has a newness and freshness that makes even boring tasks interesting (up to a limit). This is partly why they get so “abused” by companies “eating them, chewing them up, and spitting them out”: they’re a cheap but skilled labour force. The mistake a lot of companies make is that grads are also smart enough that they see what’s happening. They’ll eat dirt for a while, having decided that it’s a fair exchange for the work experience and the knowledge they’ll gain both immediately and later.

I think a lot of companies are surprised that despite being more willing to eat dirt than other workers, grads also tend to rebel much sooner. In their minds, it’s a contract, and if the company doesn’t hold up its side of the bargain, they can easily go elsewhere and try again. Older workers have ties (families, fear of finding an equal new job, etc), but grads are both too young and too inexperienced to have picked those up; they can leave easily (or believe they can).

(IIRC South Korea has an interesting take on this: the grads can’t leave, by law, at least in the game development companies. Many of them are avoiding doing their National Service by working at a “critical industry” company instead – if they quit, they’d have to take up their NS place and run around in the freezing cold shooting at each other. Although it only buys the companies 2 years of immunity per grad, I’m sure that has been a huge boon to the SK tech industry)

Grads are also great at innovating, especially in stupid ways. They don’t have wisdom, so they don’t know that stuff won’t work, and will happily do it. Older/maturer grads start to develop suspicions that things might not work, and still charge ahead, but with some doubt; younger ones don’t even realise there’s a possibility of failure.

It’s a bit like an early hand-made gunpowder cannon. It can be a total disaster. And it can rarely be channelled, certainly it can’t be aimed with precision (by definition, the grads ignore the channelling efforts of their managers). But it can be pointed in vaguely the right direction…

Grads also don’t mind having their feel pulled out from under them so much. Upheaval and U-turns by management can give more senior staff cause for fear, especially those that have experienced incompetent management in the past. Where your management is strong, and gifted, and making a difficult decision to U-turn early in response to new realisations / better understanding of the situation, you can end up having to put a lot of work into allaying the fears of panicked workers. (of course, many good management teams underestimate the need for this, blindly expect their staff to trust them implicitly (ha!), and cause an even greater panic, and/or catalyse individuals into becoming the worst of themselves. Then they fire some of their best people, naively thinking they’re getting rid of the worst).

I’m not saying Grads enjoy this, just that they handle it much more easily (although some love it – it’s giving them *even more* of that all-important “real-life work experience” and the coveted “industry knowledge”).

Middle Management

A little story: when I was the CTO at one startup, the majority of our first fifteen or so employees were doing their first or second ever full time job. If I’d had the choice, I wouldn’t have done it that way. Not because of complaints about the people (people are great or terrible largely independent of their level of experience), but because the *collective* lack of experience made the overall team a lot less effective and a lot more fragile than it should have been.

(by the way, this story doesn’t reflect well on me :). I’m sharing it in the spirit of “let’s all try to avoid making mistakes like this in future, shall we?”)

One recurring issue was that the CEO would complain at length of the pointless waste-of-time crap his staff were getting upset about. He’d bemoan that these were tiny issues, that happened all the time, in all companies, and why were we obsessing over them so much? I objected greatly to this attitude w.r.t to our staff, that it was their fault and that they were weak and stupid to get upset – and that their distress was an irrelevance, and to be publically belittled and privately ignored. With hindsight I think that incited me to overreact on plenty of occasions, but … leaving aside the sentimental aspects, he had a good point.

This went on for many months, and at the time I could think of lots of things that could explain why these issues came up – and pointed to ways of solving or avoiding them – but the recurring thought was always: we wouldn’t even see these issues if more of our team had had more real-life working experience. I think we both agreed on that, too. In the darkest hours, he even muttered about considering firing the entire company and hiring an entirely new staff, of similar size, but of “better, more mature” people. If I remember correctly, we’d fallen way short of targets so he was under a lot of stress and just wanted all these organizational problems to “go away” so he could focus on the stuff he loved, the product design and the marketing.

I don’t think that company ever really managed to sort it out, at least not for several more years, just going by the quantity and quality of people that resigned or were “let go” (whether that means redundancies, firings, or whatever) over the years.

I had some vague ideas for solutions at the time – I could see that the problems were catalysed by the attitudes of the most senior people in the company, starting with the CEO, flowing through (and added to by) myself and the rest of the management team, and then down through everyone’s social and professional relationships to encompass the whole company. It was clear that even the best of people couldn’t always refrain from “putting the boot in” when crap flowed to them, making a bigger ball of crap for the next person along. It was subtle and pervasive – no one individual felt that he or she was responsible for what was happening, because their contribution was so small. But that’s the beauty of a team, isn’t it? The whole is more than the sum of the parts… In the end, I decided (amongst other things) that if we couldn’t reform from the very top down, we’d never be able to break out of the vicious cycle. I tried different ways to get the CEO to change, and tried to change myself, and worked hand in hand with some of the other C-level staff that felt similarly about the need for a top-down change, but I just wasn’t good enough to make it all stick. So in the end, I quit, just before the next funding round closed. Wherever the company was going to go with this new money, I no longer felt I could be part of it.

Over the years since, having seen other situations both earlier and later in companies’ and teams’ lifecycles, I’ve come to suspect that the solution might have been less diffcult than I’d thought. That all it needed was one simple thing: Respect. Easy to say, not so easy to visualize and enact, of course. In a company – a startup especially – that means: Complete transparency, Trust, Faith, and (this one was a killer at that particular startup) self-doubt whenever you find yourself disagreeing with your peers.

At that startup, I saw over and over again people with huge amounts of experience – in some cases decades’ worth – being laughed at and ignored by people with none. In the other direction, and no less forgivably, I saw people assume up front that their colleagues were “too stupid” to understand the task at hand and so go out of their way to hide the very existence of it from them. Plus plenty of other activities that ranged between those extremes. At the time, I objected to these things on a general professional level (and sometimes on a personal one); I even managed to fire someone who was a particularly strong offender – but I did it too late, and too slowly. What I didn’t fully appreciate, I think, is quite how *directly* critical it was to the overall wellbeing of the studio itself; I thought it was just one (particularly emotive) aspect amongst many.

And it was lead by the CEO. It got so bad that the management team ended up having two weekly meetings: one official one with all the C-level staff, and another, secret one preceding that one, with the same people – but without the CEO. It was an open secret. All the staff knew about it, except for the CEO, of course. It was a combination of damage limitation on our part, and playing him at his own game (he liked to play us all off against each other, whether deliberately or accidentally, drawing attention away from himself). So, we’d share critical info that we needed but he was refusing to disseminate. We’d prep each other so we could provide a united front on difficult company issues that we knew he’d try and twist into an emotional issue and wriggle out of, or belittle. We’d even occasionally select a fall-guy from among ourselves, someone to put up a strawman argument on new issues, because we’d found it was one of the most effective ways for him to accept suggestions and solutions that weren’t his idea: if he had the opportunity to first demonstrate his own authority by putting someone else down. I still don’t know if anyone ever told him about those meetings, although I’m sure someone must have sooner or later.

Obviously, there’s more, but that’s where this story ends. Any new company of Graduates is (I sincerely hope!) going to have a much more clued-up CEO. But, tempting as it may be to read the story and think it was all the CEO’s fault, it’s dumb to think that one man could control a whole company so completely: there was a collective problem as well. And IMHO it mostly came from the inexperience and insecurities and uncertainties of many of the staff. If so, then the tendency will be there for similar problems to develop, and fester, with any large body of inexperienced staff. The middle management for the new company need to read this story as a parable of an extreme situation they must never get anywhere close to (just to be clear: I’m not singling out non-managers as the problematic ones here – the senior management at that startup included people who were doing their first job too).

They need to not only rise above it (that’s enough to be effective as a company, but not enough to stop the rot setting in, as I think we found out) but also have to step in early and often to prevent bad habits and bad cycles forming. I think we were all too hopeful and happy in our jobs early on to feel enough fear and forsee how much “the little things” were in danger of snowballing; sure, we might have got lucky, it might not have happened – but the risk was big enough, and the outcome severe enough – that we should have snuffed it out right at the start.

That’s going to be a tough job. You have to act a lot more like parents and a lot less like colleagues some of the time. Again, with hindsight, I guess this makes a lot of sense – didn’t I just say at the start that recent Grads are still only half stepped away from their parents, or perhaps even less? Why should it be a surprise that they’re going to need more parent-like support than people in their thirties, forties, and fifties?

And, in contrast to the startup I described, I would hazard that I’ve seen at least one company where the most senior management were more than capable of it, but their middle management were not. It took longer for things to go wrong, it was a gentler slide, but a similar set of problems eventually engulfed them. So it’s going to be doubly hard for the guys running the show: it’s not just “can you do it?” but “can you be sure that the people who are reporting to you are themselves doing it, every day?”.

Projects

Go for the stuff that allows open-ended innovation, and large amounts of creative content. That’s what Grads are great for, in the abscence of anything else.

Make sure – above all – that you have a thriving “internal incubation” system, where everyone – and I mean “everyone” – gets to work on purely explorative internal game designs at least one month per quarter. Perhaps have 50% of your staff at any one time working on non-milestone-driven pre-production experimentation. Kidnap a Google software engineer and bribe them into telling you in detail exactly how the infamous 20% time works (and doesn’t) – don’t rely on the rumours – and work out how you too can afford to sacrifice so much of your time to apparently “pointless” work.

Because until you’ve got your company established, and some of your grads have found their natural places both professionally and within your specific company, you need to do everything you can to keep from killing their spirit and optimism. If you lose that, especially for a new company, you’re screwed. With such inexperienced staff you have very little else to stack the odds of success in your favour. You’ll produce unimaginative, weak games, and the way this industry works, everywhere, your first game is more important to your future than any other single game you do.

Wrap up

That’s enough free consultancy for now. I haven’t said anything about team leaders (lead coder, lead artist, art director, etc), nor about the mix of skills to look for in hiring the Grads themselves. But I think there’s more than enough meat in what I have said to keep you all going, and to give me new things to think about for the next few years.

Ptiching to Game Publishers – some thoughts

Thomas and Diane have posted a short guide to Pitching to Game Publishers over at the blog for their game consultancy. Apart from giving them some link love (they’re not even on Technorati yet), it’s an excuse for me to tack-on some quick thoughts of my own.

(NB: my experience on the publisher side is pretty short, just a year spent working with Thomas and Diane as one of the people doing due-diligence for them on the incoming pitches, and doing milestone-reviews on the signed projects that were in-development.)
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Google cutting 20% time

Oh, wait, actually they’re not. But people love to misinterpret statements with the word Google and the number 20 in them.

As I put in the comments:

Frankly, I’ve generally not bothered to correct anyone who didn’t bother to research it themselves – except in the cases where they were in my own organization, and attempting to make decisions about related matters based on misconceptions of the supposed Google rule.

Of course, my dear lovely friends may have been lieing to me. I very much doubt it (and even if I didn’t, what they’ve said over the years has made a lot more sense than most of the hearsay you hear on the web) – but the point here is that I’ve bothered to ask.

Google has so many employees that if you preach on subjects like 20% time – which, by the way, I think is one of the most fundamentally important (and least well-understood) issues in corporations, job choice, and why you get up in the morning, but that’s another post – then you have no excuse at all for not going and asking an employee how it works. Last time I looked, they had bajillions of offices around Europe, not to mention the sprawl all over the US.

Syllabus for an Entrepreneurship Degree

a.k.a. “An MBA that would actually be worth my time doing”

Background

When I was an undergraduate at Cambridge University, a new society was founded – Cambridge University Entrepreneurs – which started an annual business-plan competition for members of the university and local community, giving away £30,000 (about $50,000) to the winners, and modelled on the pre-existing MIT 30k ($30,000).

I felt greatly let down by this competition and society in the first year, so the founder and president co-opted me over the summer holidays to change it for the next year. I ended up being involved directly with running the society / competitions (we branched out to multiple competitions) either as a committee chairman (there was more than one committee) or ex-officio for more than two years. Unofficially, one of the core reasons for founding the society was that Cambridge University at the time did not have any dept devoted to Entrepreneurship; the closest it had was a few classes on entrepreneurship within the Engineering Faculty (Engineering at Cambridge being an exceptional course of international reknown, and hence very large in terms of undergrads and well-funded in terms of diverse courses and extra lecturers; it also had a history of graduates going and founding successful startups). In the belief that the university would take many years or decades yet to found a new faculty for entrepreneurship, this society was created instead. Teaching entrepreneurship was a major mandate and one we took very seriously, running our own entire lecture course (!) each year, for which we co-wrote the syllabus with our sponsors (law firms, accountancy firms, management consultancies, venture capital firms, marketing consultancies, etc) who were also providing 2 or more speakers for the “course”.

The whole exprience was fascinating, and I learnt a lot both from working with the various people involved (sponsors, angels, investors, organizers, contestants) and from entering the competition myself one year (making it to the finals but not winning the cash prize) – but perhaps most of all from seeing what happened to the competition alumni AFTER the competition was over (we maintained strong links with them). I even worked for one of the alumni companies as a summer intern (with the title “Lead Developer” IIRC).

But we never did do very well at the “teaching entrepreneurship” part; our lessons were great, high quality with lots of juicy information, and generally very well recieved – but with hindsight they never seemed to have taught much of what was really needed by the entrepreneurs. It’s something I’ve thought about a lot in the back of my mind in the intervening years.

Here’s a new idea: get rid of the lectures, get rid of the tests, get rid of the business plans, get rid of the competition based on “40 page plan + 10 minutes pitch to a panel of real investors”, instead…

It’s all about the pitch, baby

  • Given the facts, can you pick out the bits that will make the company succeed?
  • Given the facts, can you pick out the bits that will make the company fail?
  • Can you convince someone you’re right when they’re trying to find a reason to condemn you?

The whole course would be built around Pitching. Everyone on the course would spend half their time pitching, and … half their time reviewing other people’s pitches.

The key abilities participants should be developing are:

  • Ability to sell, given some info
  • Persuading a cynical and suspicious interrogator who’s allowed to dig further into anything you said
  • Keeping a time-limited meeting on-topic despite the above
  • Seeing through the BS in someone else’s pitch (useful both in self-analysing your own pitches, and also in evaluating business partners and vendors)
  • Understanding what needs to be said about a company and what – given a time limit – is unnecessary to be said, even if it’s critical to the company
  • Understanding what can be said, and sounds good, but in reality means little, because it doesn’t actually differentiate sufficiently from the failures

When I say “reviewing”, I mean something specific that is NOT what you normally see. I have a trap…

The pitching game

Each pitch-session, you have 3 teams pitching, and 3 teams reviewing.

One of the pitching teams is told that their company is fake, a lie – they have to try and trick the reviewing teams into giving them the money. They are allowed to say ANYTHING in their pitch, and present it all as fact. The other two teams are given the facts of real companies to pitch (names removed), and MUST stick to the facts (this to be assessed by person running the course; some leeway is allowed, but its assumed there will be a due-diligence session further down the line, and veering too far from the facts will count as failure).

Here’s how it works to achieve the learning goals above:

The real teams have to learn, by trial and error, what “facts” about a company are the ones that will A) convince investors, and B) make them stand out from the liars.

This forces them to think about what makes a company suceeed – and, possibly more importantly – what makes a company *appear* to succeed. Competing against liars, they’re going to have to succeed at both.

The liars just have to master the art of the sell. Which is crucially important both to building and running a business and to raising funding and keeping investors happy enough to raise follow-on funding.

There is more to it than that, and there were some better ideas I had half-formed for the game part of this, but I’m out of time for today. The essential idea should be clear though: use “the pitch” as the recurring fundamental element of all the teaching.

Salaries for startup directors / executives

This is in two parts – the problem that lead to me even caring, and then some very interesting conclusions that can be drawn from looking at last year’s aggregate data on how much tech startups ACTUALLY pay their execs. A lot of random speculation is thrown in, I don’t stand by most of it, but it’s interesting how much stands out just from looking at the aggregate data.

PS: to all the people reading this blog for the MMO tech stuff, I hope you don’t mind the shift to a lot more business stuff lately. This is what happens when you put together a new startup :). I promise there’ll be more MMO-specific stuff in future…
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Over $150M invested in Europe into social games, VWs, casual MMOs & games

Jussi posted an excellent writeup of how there’s been over $350 million invested in social games etc worldwide, and commented that he the European side wasn’t really included in his sources.

But I’ve been tracking the European side for a while, and since I’m preparing a new MMO / Education startup at the moment, I’ve recently been refreshing my data.

So, here it is: my version of Jussi’s post, but the EU-only version :)
Continue reading “Over $150M invested in Europe into social games, VWs, casual MMOs & games”

What’s the future for Game Development Studios?

(this is part 2 of Publishers are from Mars, Developers are from Venus)

Last time I said that “good Developers are very similar to Valley Technology Startups”, which suggests one obvious way things could develop:

Publishers to become Venture Capitalists; Developers to become commodities

In this model, the Publishers spend their time “speculating” in Dev studios: instead of buying a studio in order to own the output of that studio, you buy it with the intent of later selling the studio itself at a profit.

This is a good model; as I first heard from Jack Lang, at one of the Cambridge Enterprise Conferences many years ago:

“The best way to get rich is by buying and selling things. Preferably companies”

IIRC it’s a quote that’s been around for a long time, but I can’t remember where the original quote came from, unfortunately.

(of course, this observation is why Publishers are box-shifters in the first place: simply buying and selling things is an easy, fast, stable, sustainable way of making a very large amount of money. It’s not particularly creative, perhaps, but it’s a very efficient way of generating profit, and lets you leverage your resources/cashflow way above the profit you would generate simply from manufacturing your own goods and selling them)

The real beauty of this is that – as Jack’s quote illustrates – a Publisher and a VC have very similar fundamental business models: they buy stuff that they have no intention of using themselves primarily to sell those things at a profit to other people. In both cases, the less time the company can hold onto the products, while getting the same price differential between purchase and sale, the better. What is a VC? A VC is just a higher-value version of a box-shifter. So, for a Publisher to diversify into being a VC may not be so difficult…

As someone who’s been through the mill of raising finance for startups before, I’d also like to add that “funding game development” is commonly thought of as having no equal in risk and unpredictability – save “providing venture capital for a new startup”. The hardest part of being a VC – the insanely high risks involved – is bread and butter for Publishers, who routinely spend tens of millions of dollars on stuff they don’t understand, cannot effectively control, and cannot reliably predict!

Studios would find that:

  1. Publishers would look after them more – you don’t want to harm something you’re planning to sell
  2. Funding and marketing decisions would be driven more by what was in the interests of the studio rather than the Publisher’s marketing dept or cashflow
  3. Publishers would stop being stupid about trying to “reduce costs” of development purely for the sake of it
  4. Publishers would be a LOT more interested in supporting and creating external partnerships for the studio, especially where those partnerships involved competing publishers or their subsidiaries (because that would make it easier in the future to sell the studio to that competing publisher), which would help reduce development costs (a little) and increase productivity / quality of working environment (probably a lot more – publishers usually consider this too little justification for allowing such things)
  5. If the publisher got cold feet about publishing a certain game and it was far advanced, they would push for POSTPONING it rather than RUSHING it – they’d rather sell the studio BEFORE it publishes the game, and “price-in” the potential of the game than sell AFTER the game had launched and flopped
  6. The publisher would push harder for maintaining quality standards of the games output by the studio – they have literally invested in the brand of the studio, a brand they are planning to build up in value as much as possible, before selling

Publishers would find that:

  1. Development costs would no longer mar their balance sheets and make their financial performance look bad; the offset of being able to mark the studio as a sellable asset with a quantifiable value in excess of the money being poured into it would make it all smell sweeter to shareholders
  2. There would be less friction with studios, leading to better communication, less frustration, and probably better overall quality of product – and hence, more profits
  3. Studios could safely be given more leeway to make strategic business decisions that were “right for them”, offering the possibility of mega-wins for the publisher whenever those paid-off (e.g. the decision by early FPS developers to not only allow but encourage modding was enough to terrify publishers even today, and yet a massive win in sales and profits), but also to not have to take responsibility – and blame – when they failed; this would all be priced into the “value” of the studio as a separate, tradeable, entity
  4. If a studio made some bad strategic decisions that led to commercial failures, that might actually INCREASE its tradeable value, if the market perceived that the studio had “learnt” significantly from the mistakes; potentially, such increased value could completely offset the actual financial losses incurred from the mistake

A practical example

I’m just pulling this out of thin air, trying to think of a studio that many years ago was worth something, got acquired, went internal, and now is probably worthless. When EA bought Westwood Studios, one of the things they paid for was the brand; how much value did they really extract from that brand? How much value does it have *today*? Today, it’s probably next to none – customers don’t care, and other games industry companies all know that the real meat of Westwood Studios (the staff, the equipment, the processes) was disbanded shortly after being bought by EA. Could they have made more money by promoting and protecting the WS as an owned-but-independent studio? If they’d taken that route, and even if they had made less money than they have with the route they chose, would it be more than made up for by the fact that they might be able to sell WS right now for, say, a couple of hundred million dollars – if only it still existed as more than a name?

And why not?

But this isn’t the way Publishers work right now, so … where does this plan all go wrong? Why hasn’t it happened already? What might prevent people from trying this?

1. Cojones

At the moment, the funding decisions that Publishers make are so distantly removed from the actual point of capitalizing on them that it’s quite easy for the people making the funding decisions to blame many other departments and personnel within their organization should the investment go poorly. Indeed, this plausibly deniability, this easy abrogation of responsibility by the decision makers – and the great distance between them and the people actually implementing the game – are root causes of a lot of the practical problems in the Publisher/Developer relationship whenever they do “external” publishing (i.e. publish a game made by an independent / external studio, as opposed to a wholly-owned internal studio).

A lot of the benefits for the New Way cited above stem from removing that indirection; that means a bunch of people making hundred-million-dollar decisions would be exposed to rather more scrutiny and responsibility than they hold right now. I’ve heard people (usually the ones who don’t really understand VC’s, have acted naively or foolishly with them, and come away poor and bitter) describe VC’s as “arrogant”, “bullies”, and “too demanding”; while I don’t agree with that, just think how you’d act if you were the named individual responsible for a handful of $10million investment decisions, and how that might come across sometimes. Could the individual people working for Publishers accomodate such a change? If they were content with that level of personal exposure to risk, would they be working in the games industry, or would they already be working in the higher-paid VC industry?

2. The Art of the Sale

Another issue is that the success of selling a studio depends on, well … your ability to sell!

Publishers do not, generally, have any experience of selling companies. A publisher might spin-out or sell off one division every decade, at most – and many of those are instigated by the division itself (management buy-outs), or are fire-sales (find a buyer at any cost, no matter how low). They don’t have staff who are experience in doing this, they don’t have any contacts suitable for doing it, and they don’t (generally) maintain the level of immersion in the marketplace of studio buyers to be able to setup great deals when selling on a studio. Look at how much time the individual staff at VC’s spend purely “networking”, both looking for things to invest in (new purchases), but also looking for, befriending, understanding, and keeping up to date with the needs and desires of potential buyers (people who might acquire some of their portfolio).

3. Organizational Change

Lastly, have a look at the typical VC organization – a handful of Partners (maybe half a dozen people who make investment decisions), a handful of Entrepreneurs in Residence (EIR – maybe one or two domain-experts who make recommendations and help in due diligence). This is enough to manage billions of dollars of investments.

Now look at the typical Publisher organization – 50 people in each of marketing, customer service, and sales, perhaps 15 handling external develoment (finding and making development/publishing deals), and another 10-50 people in internal support roles. This is enough to own 1-3 development studios.

This isn’t to say that Publishers would need to downsize. Rather, it’s to point out that if the external development side started doing sales of studios for as much as $100million a time, their revenues and profits would suddenly massively eclipse (20 to 1, perhaps even 200 to 1) the whole of the rest of the organization, despite being outnumbered more than ten to one. Sooner or later, the “rest of the organization” would become politically weak and subservient to the massively profitable “trading in ownership of development studios part”.

The VPs of the current departments may well find that the total pie they’re sharing in becomes much bigger, and much more than makes-up-for the fact that their slice has got smaller, but will they accept their slice going from being a “Vice President” sized slice to a “Operations Manager” sized slice?

A few little Notes…

1. When I wrote Publishers are from Mars, Developers are from Venus, I had *no idea* that NCsoft had just decided to shutdown its European development studio, and make a swathe of redundancies in European publishing. Sheer coincidence, and sad for a lot of people involved, but very interesting nonetheless.

NB: if you work for a publisher or developer and are interested in picking up any of the good NCsoft Europe staff, especially development, QA, localization, and customer support – and you have jobs in or within commuting distance of Brighton – let me know. Lots of people are suddenly looking for stuff to do next…

2. I said that “Developers exist to make a loss, every day”, and some people questioned that.

Yes, I really mean this: the more they spend, the greater the potential profit, and they should be maximizing their potential profit. Obviously, there is a point of diminishing returns, but generally speaking whenever you have an R&D lab, you want to pump as much money into it as you can possibly spare. Generally, R&D labs are rather good at soaking up almost infinite amounts of money.

Compare the revenues and the expenditures of, say, GTA IV with those of Bookworm Adventures. The latter may have been much much more profitable in percentage terms, but the former made a bigger amount of money overall. Often, the sheer amount of money you make is more important than your profit percentage.

3. I decided to write these blog posts after a comment I made to Steven Davis about the problems of publishers owning development studios, which he replied to with “Actually, the publishers should fund these things like a movie studio or VC. Let them be independent, get them off the books, and use your money to control distribution or via publishing rights.”

I’d been thinking along similar lines, but I also realised I saw some big problems with the approach, so I thought it would be interesting to explore in more detail. But if he hadn’t made the comment, I probably wouldn’t have got around to it :).

Publishers are from Mars, Developers are from Venus

Over the last few years, there has been a big shift in power and success away from independent studios, and towards in-house, publisher-owned studios. This has been driven by several things, sound economic reasons, competitive reasons, and because the strong independent studios had done a good job at creating a slew of new IPs (which publishers were eager to snap up, as always).

In my experience relatively few people in the games industry realise this, but all these things are cyclical (it’s a lot more obvious in non-niche industries, like the IT industry, where you have many more companies, and the billion-dollar companies can’t be counted on one hand). So, what’s next? What’s going to happen over the next 3-5 years?

Some (recent) history

My last job was working for a large publisher (NCsoft – http://ncsoft.com) where we were setting up a new internal development studio from scratch. When I arrived I there was only one other person (plus my manager). We were doing a lot of other things at the same time – external development, pitching new internal projects, etc – but over the course of the first year I spent a lot of time looking at what we had to do to get a studio up and running, starting from scratch.

Interesting and fun. But also … surprisingly difficult. I’ve been one of the first employees at a couple of startups, and founded some, so I’m accustomed to starting up teams and departments, and a lot of the problems we encountered with this studio were just variations on familiar themes. But then there were also some new ones, side-effects of being inside a huge, well-established, publisher – one whose head-office was on the other side of the world, where the vast majority of the staff didn’t share any languages with the vast majority of the publishing office in our country, and our staff.

To summarize: the things that should have been completed fast were incredibly slow, and the things that should have been easy often turned out to be extremely hard. My definition of “should have” here is based on “whatever plays to the strengths of large corporates”.

As that became clear, one option would have been to throw up our hands and say: “this company is crap! No other similar company works this way!”. Instead, I dug deeper, and tried to understand how it was that we seemed to be seeing a lot of the opposite of what I expected. Sure, a lot of it could be explained by some over the top internal politics, and some by issues with individuals, but … this is a billion-dollar public company, and it’s foolish to think that management could be so weak and disorganized that a few internal battles and a few individuals could cause major aims of the organization to fail. No, there were underlying problems that were natural side-effects of the way the company worked. IMHO, these same issues are almost certainly causing problems for other internal development studios already, and will probably be major contributory causes of the move away from internal studios (when that day comes).

Publishers exist to make profit, every day; Developers exist to make a loss, every day

I could stop there. In that one sentence is encapsulated a problem so powerful and subtle that it’s more than capable of causing all the secondary problems – the ones people actually notice – that lead to publisher/developer acrimony when the two are together in the same company.

A traditional publisher is a box-shifter that pays a hefty license fee for exclusive rights to import a popular, trendy product from a foreign country. The things they need to be good at are:

  • Identifying the Next Big Thing, and signing an exclusive deal before anyone else gets it
  • Efficiently importing that thing and distributing it out to mass-market consumers (this is where most of the opportunity for profit exists)
  • Persuade as many people as possible to buy the product, as quickly as possible, for as high a price as possible (this is where ALL their revenue comes from)

Why did I mark the SECOND point as the point for profit? Because profit is extracted through the differential between the costs generated in that bullet point, and the price point that the publisher – arbitrarily – places on the product as sold to retailers (who then, typically in retail (forget the games industry – this is normal for all industries!) double the price again before selling to consumers).

The price point can be … anything you want. The volume you sell comes from the third bullet – but you have NO control over how much you sell. You *try* to sell as much as you can, but you cannot wake up tomorrow and *decide* to double sales. However … in contrast, you can wake up tomorrow and *decide* to halve costs. Or double them. So you focus on that middle bullet point: Efficiency (while making sure you assign a healthy slab of money to a sales + marketing department, and set them “targets” to try and meet).

A traditional developer is an R&D (research and development) laboratory. They try to be as scientific as possible, whilst spending every day working with masses of unknowns (and several unknowables – what is “fun” anyway?). After working for an indefinite period of time (no way of telling how long it will take) they’re trying to create (or discover) something that has never been created before, and which satisfies various criteria – many of which cannot be measured until after the project is complete.

They absorb money like a dry sponge in a puddle, with very little to show for it. The things they need to be good at are:

  • Securing as large a pile of resources as they can, and spending it to the fullest
  • Trying crazy stuff that they can’t explain, and waiting to see what will happen
  • Sticking as close to the cutting edge as possible, and always investing in long-term improvements

Why do they have to secure a large pile of resources?

Because their success is limited only by two things: their resource, and their skill. That translates into three concrete things:

  • How good is their equipment? (”equipment” means EVERY TOOL they use to do their work – including lots of indirect things that you may not think of as “tools”)
  • How much reagants and raw materials do they have? (everything consumable … including “time” … that could contribute towards doing MORE experiments)
  • How good are their staff?

Those three things are, in turn, only limited by “money” and “the quality of the people they hire”.

Publishers hate this. No, that’s not strong enough; Publishers REVILE, DESPISE, RESENT and LOATHE Developers for always, ever, and only going after those two things. And … they don’t understand it.

Frankly, as a box-shifter, with “efficiency” your only concern, WHO GIVES A F*** HOW “GOOD” YOUR PEOPLE ARE?

But that’s not the worst. No, the worst is this: as a box-shifter, the only thing you can directly control is your costs. Everything in your business, from the structure, to the choice of staff, to the processes, is designed to reduce costs. And what does every R&D laboratory obsessively try to do? Yep – raise costs!

If you ask a Publisher to create, fund, nurture, and partner with a Developer, you are asking the staff to encourage, to aid and abet, the one thing that you are already telling them every day to hunt down and destroy. Capiche? Does anyone see a problem here?

Developers in the Wild: R&D for profit

Well, this is clearly insane – how could a Developer ever make a profit? The answer can be found most easily by looking to the one place in the world where R&D laboratories make more money than anywhere else: Silicon Valley.

In the Valley, the Technology guys have become Entrepreneurs (or found an Entrepreneur to work with), and they’ve gone out there and applied their intelligence to a new problem: “Given this thing I’ve created, which is novel and cool and awesome, how could I use it to drive a product that people would pay for, and which (because of my NEW tech) I can sell cheaper than what is available, or (because of my NEW tech) does something people have been trying to pay for but been unable to find a working solution for?”

Despite appearances otherwise, good Developers are very similar to Valley Technology Startups: it’s all about the monetization, the capitalization – what bridge are you going to build between “what you’ve created” and “someone who has money and a problem”, and HOW are you going to build that bridge?

“Sell the exclusive publishing rights” is one bridge. It can be built many ways.

“Create an infrastructure that lets us deliver this product to the public, and take money from them” is another bridge, with just as many potential schematics.

But then there are others too, many others. Just because those two are the ones that the game-playing public tends to talk about (and are the two that Publishers are most familiar with) doesn’t – by any stretch of the imagination – mean those are the only ones that exist. Ask Blitz (an independent developer) about their Advergames for Burger King (definitely not-a-game-publisher). But, in general, just like in the Valley, the “other” bridges are tricky to invent, and tend to make someone rich just once or twice once invented and done for the first time. There are always new bridges to invent, and if the Technology person’s main role is to invent new tech, the Entrepreneur’s main role is to invent new bridges. So don’t be surprised if you find it hard to think of some.

What happens when a Publisher catches a Developer, puts it in a cage, and ships it back home? Or, more specifically, what do they do to the people that are thinking up innovative new bridges for monetizing the Developer’s assets, and trying to implement them? I’ll give you a clue: if everyone you know believes the world is flat, and has never walked more than a few hundred miles, and one day you meet a person who claims to have walked around the circumference of the planet, would do you do?

Yep. These people tend to be first in the firing line when nerves start to fray and the tensions between Developer and Publisher flare up. They’re an easy target – they make no sense to the Publisher, and their very existence is an affront to their core business model, to their box-shifter mentality (it suggests that the box-shifter is doing a simpler business, something run by simpler, less imaginative, more stupid, people).

UPDATE: I’ve just written a followup looking at one of the possible future directions coming out of this