 Hello everyone, I'm the man goose you are awesome today We're gonna be talking about the business of gaming and I've got two businessmen here I have a business myself I've selected all three of these people because we have owned and operated our own businesses before From project stamina is the producer Mr. Fancy pants. How you doing man? I'm doing great. How are you doing? Well, and of course you guys He needs no introduction from a made of studios the game designer RGS ace. How you doing ace? I'm doing good Thanks. How about yourself doing? Well, I'm sorry to talk about this topic now Both of you have owned businesses within the tech industry, right? Yeah Yeah Yeah But so yeah, go ahead. It's all it's a long story, but uh, I I worked in games for a long time and then I branched out into Laboratory analytics because there was an amazing opportunity here in Oregon And I had the right people and the right equipment to launch company So I did that for a couple of years actually tried to square off gaming But then I sold the company and had nothing else to do so I got back into making games. All right on Yeah, my business is property preservation has absolutely nothing to do with tech whatsoever But I do understand some of the complications that come with running a business So this should be a good conversation. What we're gonna start out with is the free-to-play business model It's very common out there. It seems like any MOBA or indie game kind of has the follow that free-to-play business model Because of um, I don't know. It's just so prevalent. That's what people expect But is that what you need to do is that do you have to have a free-to-play business model fancy? What do you have to say on the topic? I I'd be willing to believe that there is a model out there that has so like there There's two basic models and that's free-to-play and the games as a product Which is like a single-play pay-to-entry, which is what overwatch does and technically they get away with it but they also are blizzard and can afford to Put a paywall like in front of their products because so many people are going to buy them because they have such widespread popularity I think for anything smaller trying to crack into the market putting a paywall in front of something Not Guaranteed to be as big as overwatch is Probably the way to go because you just need to reduce that barrier to entry to get people Into the game and making it a part of their lifestyle Acer you have anything to weigh in Yeah, I pretty much agree with what mr. Fancy's dead. I think If you're a smaller studio you want to get it's all about those numbers like getting as many people playing your game and when you start adding things like People are charging people to play your game You're adding barriers to entry and then you know There's gonna be people that don't want to pay for your game You know someone might want to try your game out But they don't want to spend 40 pounds to do so and you might have lost a customer there. So I think Pretty place kind of the way to go and I think if you if you're a smaller studio you want to be successful It's kind of like a proven model that works Right. Yeah, and I there's a lot of them See with with with there's there's difference here between project stamina and predecessor predecessors building upon the free assets released by epic that were used for a paragon and That is that's something that's a matter of contention with a lot of people They think that any game that's building upon Premade assets shouldn't be able to charge any money whatsoever Which I don't they seem to live in a Disney movie where they think that everybody can just live off of sunshine and happiness And then everything will be great as long as you follow your heart No, you have to the game has to be sustainable in order for these for us to play them They have to be able to make money and you know people are entitled to a Monetary reward for the effort that they put into these games Project stamina doesn't really have as much of that problem because I mean you guys are building all your own stuff from scratch However, you are basing it upon gigantic which is a game that came before you guys And even though it is your own intellectual property, but it's obviously an ode to gigantic So I think there definitely has to be a way ahead with that So as far as Applying the free-to-play business model to you guys's games. What do you think ace? So I think it kind of comes down to what kind of vision we have for the for the business as a whole So, yes, we do use Paragon assets kind of long-term conversations that we've had with people from the industry Is that we want to move away from? using Paragon's assets So we'll kind of do the heroes wall the heroes and then we'll kind of evaluate where we are as a business At that point It definitely has its advantages like you can build a lot quicker You have the assets don't need to worry about finding someone to animate all these things that you they go into making a hero Yeah, it's it's it's that we're definitely spoiled. So it allows you to do you move a lot quicker pace I think as a startup, especially you need to be moving fast and So that's like the advantage the disadvantages is that other people have Those characters and they can put those in their game Which kind of you know, it's like oh, there's two versions of camera like in this game And I really like camera in game a but I like you know, it's when blast in game B So there's there's this conflict that it's probably not healthy to have and so long-term we would always want to move away from that and If you're sharing assets, so this is kind of looping back in So the whole free-to-play thing is like if you're sharing assets with other games and people have the choice of playing different games You definitely don't want to add barriers to your game already because someone's gonna be like well I've got to him last over here and I can you play him for free the game might be No, not as good or whatever. It might be they might be, you know perfectly Perfectly the same but this game is free. So I'm gonna just play this game and so for us. It's more We're not really looking to make money in the short term I think from from the from my experience in eSports betting and the investors We have there like we're backed by the largest gaming fund in the world So we've spoken to people about you know What what kind of steps do we need to be taking so that this is becomes the proper business? And so we just want to focus on building a really good product Giving people access to the game through free-to-play and then kind of evaluating where we are after we build those 38 heroes or whatever it is And then a fancy it's a bit of the same thing with you because Paragon had very Realistic-looking just blow you away graphics whereas you guys went with the with the the cel shading which has become quite popular within games I imagine it's probably easier to design a cel shaded character than a One of the Paragon models. However, you guys are doing all this from scratch So and it's all kind of in the eye of the beholder to you So like it's a different kind of design challenge. I Can't say it's easier. It's like It's it's less of a processor drag and like it's it's less graphics intensive But there's nowhere to hide anything. So everything that you do has to be really clean. It's like It's different. It's a different kind of art. It's a different kind of design Either way like the amount of work that goes into making a character look good and be exciting and attractive to play is pretty massive and as as I think you were saying ace when When you look at like how to make that work sustainable the early steps really can't be trying to bring in like trying to bring in the income that Makes all of that float because without without the massive player base to subsidize it you're relying on a small amount of people to Produce all of the resources that you need to keep that going so in in early development as it seems like both of us are All of the efforts really have to be going towards just bringing people in and keeping them engaged So that you can reach that critical mass so that when you start asking for any amount of dollars The the price tag that you put on whatever it is that you're selling to make this whole thing work in the long term is not You're not gonna sticker shock people away Yeah, 100% agree and if you look at like the average revenue per user of some of the biggest free games if you forget about for night, which is like absolutely ridiculous amount League of Legends is that like this is like historical figures. I don't know what they aren't from the past few years But it's about a dollar average revenue per user So when you look at that you really need to be hitting like this a huge gale to have a sustainable business I think for nights is like $90 per average revenue per user, which is like double I think it's double snapchat double Google. I think from what I last looked I looked at it a while ago That's annual. Yeah, it's insane When I saw that I didn't believe it like it's ridiculous like 90 X on what League of Legends was But I don't know they've taken historical League of Legends So I don't know if they've improved over the time But yeah, like saying you need to hit like this critical mass That is absolutely bonkers. I didn't know I mean everybody knows that fortnight's making money hand over fist Epic tripped over a diamond right there, but I didn't know it was that much Yeah, it's ridiculous Anyway, I hope hopefully everybody Whenever you're looking at whatever these companies do ask for money or they you know, they do some sort of fundraising I hope you do look at that and just be aware that you may not know as much as you think you do You may think that the Paragon assets are free. You can just plug them into the game and play. Why is it this game running already? No, there's a lot more to it than that and a lot of people have to put in hours and hours of work to make that happen Same thing with project stamina. They're like, oh, well those those character models don't aren't the same poly count as the Paragon heroes Why is it this game already up and running? It's because there's a lot of work that goes into creating these new characters and Doing their own animations and everything. So just bear that in mind whenever Yeah, you're thinking about coming out of pocket and giving some of these guys some money because they will need money to Succeed, but we're gonna move on to the next topic, which is the difficulties Inherent when when doing business in In an international arena, for example, just this interview was difficult for me to set up with ace being in Europe and Fancy being on the west coast and me being on the east coast It was a little difficult to schedule a time to get everybody together at the same time And I imagine with you guys having your teams just spread out all over the all over the place that it's got to be Very difficult to manage Fancy I know you've you've made some comments about the whole about moving away from brick-and-mortar establishments before What do you got to say man? I So I think it's it's an entirely like like with anything any business model comes with trade-offs There's something really nice about being able to just sit down in a conference room and figure something out with a whiteboard that everybody can like see and point at but more and more companies especially tech companies are moving in a direction of like Locationless of like a cloud like cloud offices basically. Oh god, that's a terrible movie Visit the cloud office Yeah, like there are so many companies that are moving in this direction and there's no reason it can't be done with games Slack I know is a big one buffer the social media company Does does this really well? There are lots of marketing companies that are like wildly spread out they they have Central offices, but in like five or six different cities and teams on different accounts will just be Wherever they could find the people that were best for that account And it takes a different kind of coordination but one the technology to be able to do this both in terms of like raw internet bandwidth and also The digital organization tools to make to pick up the slack for Not having people in the same room and in the same office and like showing up to work at the same time every day these tools exist in a way that they didn't really ten years ago and we have this entire generation of people who grew up extremely online and And Are familiar with the kinds of coordination that it takes like it's no It's a little different, but it's got a lot of the same like fundamental challenges of organizing Like an MMO raiding guilt who are scattered across the world But your main tank is on the East Coast and your three best healers are on the West Coast and you're like DPS leads Are in Europe. So when do you have your raid and like this is a little bit more? I'm going in every day, but it's the same principle and Did I lose you guys again? No It's the same principle and I think that this is the direction that we're gonna be seeing a lot of tech companies going in the future I based this model on A small but fairly successful mobile gaming company called Sprye Fox There was a series There was a series of articles on game a suit got called like house Brock How Sprye Fox designed itself to be a cockroach to survive the gaming industry and I thought that it was really brilliant So why don't we try it ourselves and it's working out really great? That's I'll tell you challenges, but I like that analogy with the Rating guilt trying to coordinate that because I think a lot of people can relate to that not even not even just even an MMO rating yield, but just gaming in general trying to link everybody up at the same time Ace, I know you guys are spread out spread out all over several different countries What how do you guys resolve those challenges? Yeah, it's an interesting one So I think when I when I joined predecessor it was I think was a bit kind of chaotic But at midnight we have like a remote team So we have our trading team is in Canada We have developers. We have three developers north of the like north North ish in the UK and then mostly everyone's in London Well, we do have like remote people And so a lot of the stuff that we do at midnight I try to incorporate a predecessor as well It's slightly different when you're working on a project that everyone's you know Putting their own time into because everyone's doing it because they want to do it Whereas when you're working at midnight, which is basically a tech company, you know, that's your job You're paid to do that. So a lot of what we focus at midnight is more We want people to be more happy and like have think of this as the fun place to work Whereas you don't really need to do that when you're working on a game you love But when it comes to like organizing things we do Midnight we have like a weekly stand-up where people will showcase Their work that they've done for the weeks to everyone has their like 10 minutes of glory And then we discuss what our goals are for the next week why we didn't hit our previous goals If if we didn't and everyone gets to share a bit about what they did We have that we do a similar thing for predecessor Where we just talk about what we're planning for the next week Usually everyone's sharing what they're doing whenever they finish it Instead of sharing it at the end of the week, but I think when you're working on something Like that you love everyone just wants to share like oh, I completed this today. I completed that today But we kind of like want people to just Share what they're doing. I think remote working is like super common like every every time I've worked at a tech company or at midnight It's like everyone there's there's remote people Ruba works with Amazon and so like they're a huge company and so he's dealing with teams all across the world So I think everyone's quite familiar with working remote and I don't think there's any challenges anymore like It's super easy. It's like being in the same room. Thanks to tech technology Right on well, that's good good to hear good to hear I think I think the biggest problem that I would imagine both of us are facing it is Because we are passion projects and we aren't anybody's full-time job It's my full-time job, but I'm blessed and able to work for free until this thing takes off The the biggest the biggest challenge that we face is Fighting with people's actual work schedules like we have people who are Sitting down and showing up to work Basically every free hour that they have but they're three hours or like three or four hours and in the evening a couple of nights a week And so if you need a meeting with five people, you've got Four or five different work schedules to contend with on different time zones and not everybody works in nine to five necessarily so that like that juggling act is probably the single biggest challenge for progress, but it's really It's really encouraging that the biggest problem that we have is one that we can definitely solve by throwing money Yeah, just by paying your people and have them that this be their full-time job. Yeah, like hey, this is your job show up great And okay, so I think that closes that out. Let's uh, let's talk about some of the hidden costs I'm sure you guys could probably open my eyes to some things some of the things I thought about we're advertising server costs That's about all I could think of Hey Ace, what are some of the hidden costs? What are some of the things that people might not be thinking of when they're thinking about game development and what needs to be paid for? Yeah, so I think at this point we don't advertise but We do that for midnight and trust me that they can get expensive really quickly But in terms of predecessor at the moment you're looking at like server costs, so You know you got your bandwidth costs Any other sort of fees that they might charge if you want dedicated support That's that might be another fee depending on who you go with and you've got Your we use per force so that has fees associated with it once you want more Users that's basically allows us to work on code push it so someone else can have it It's sort of like get but just a better version That's definitely not cheap Then you've got and also when you start taking in money You also have to deal with payment providers who also take their fee on top of everything And then those payment providers have deals with visa and whatever visa take their cut as well You also have to deal with the store that you're using if you're on steam or an epic There's a fee associated with that whether it's a license fee or a fee on a transaction If you have a website, you've got hosting fees And then if you want to get down into like further details when you're rendering You know when you're building lights for a map that you might have your PC on for eight hours If you're doing that, you know Four or five times a week that can add up over the course of a year. It's probably not Anything crazy, but these are all costs that people Encourages by working on a passion project and I'm sure there's more that I've missed out And then fancy might have some as well. No, I mean It's it's just kind of a continuation of that list like All of our designers have to pay for their own tools. Maya is not cheap neither is Z brush nor I mean the adobe suite is like reasonably affordable for students which some of our some of our some of our concept artists are like finishing up Graduate or postgraduate degrees so they get student copies of the adobe adobe suite but that's still a couple hundred bucks a year and then like you said server costs and Server maintenance and then all of the all of the development tools Do you like do you want the legitimacy of having your own email domain gotta pay someone for that? Otherwise your blanket Gmail, which we still are because we decided to buy the domain for our game name which is still a secret and Yeah, like development tools if you want something if you want like a robust task tracking System like a project management act, which is one of the really critical pieces of working Remotely is having a strong digital storehouse about everyone's projects and project management tools Those are not free. They usually charge per user and then I guess one of the like non It's not monetary when everybody's working for free, but one of the costs that a lot of people don't think about in In game development is technical debt Which every time like there has never been a Piece of software that was written perfectly the first time That is that it was written. There are always new features that need to get plugged into old systems and better like discoveries of better ways to manage large pieces of Technical infrastructure to keep everything moving slow moving smoothly so that you can do things like reconnecting to games when you get dropped from a client or lose your internet connection so that you can do things like Build wild new abilities on characters that kind of break the paradigm of what the game looks like so far and those kind of interactions come with experimental code that kind of tells you that the thing is possible and then When that's done and your your development team has to make a choice between going back and cleaning up their work and moving forward and working on the next thing and a Lot of especially gamers that aren't programmers Really don't see How much work it takes to fix bugs especially when legacy code is involved one of the famous ones is the the flying horse in the The Elder Scrolls series like that exists because they've been using the same engine and just building on top of it and building on top of it for Decades now and It would probably take more work to rebuild The game just to actually fix that bug then it would take to make Elder Scrolls 7 and 8 and That that kind of cost is completely invisible but it continues to build up over time as developers add to a code base and It can become like an insurmountable chain like all to which you are chained and cannot progress further if you don't Habitually pay down your technical debt through labor, which if you are able to pay your people is not free And that's I Know that's just one of the that's one of the hills that I'm well I found is paying down your technical debt is very important even if it slows down the apparent progression yeah That time is the time is money people don't really understand that until they get into You know running a business themselves time. It definitely is money Mm-hmm All right. I think I think that's about it unless you guys had anything else you wanted to say on on those topics I mean, I could I could talk about like the difference between advertising and marketing, but I could do that for an entire episode But we'll save that then well, we just go ahead and let you guys plug anything that you want to Fancy anything you want to you want to plug Okay, yeah So check us out on project stamina calm all of the links to our social stuff is there So just go to that one website. We are now taking sign-ups for our for our first round of alpha Which has not started yet. So we have a we have a sign up for an email list at the bottom of our web page Go there sign up. You will get an email when it is time for the alpha to start the instructions on what to do next That's a fun one and Check us out on twitch. We've got a trailer coming out sometime early next year and that's gonna be really excited awesome Ace Yeah, um, you guys can check us out a murder studios comm web mostly active in discord. So Come pop in I think we'll have some some great stuff to showcase the next year And if you're into eSports betting and you're over 18, you can come check me out on midnight calm Or you can just message me on discord and I'll hook you up Right on man. Yeah, I'm gonna check that out myself. I I knew about reversify I knew that you were we're into some some some eSports betting. I didn't know you were actually part of the midnight I'm gonna go and take a look at that. Yeah, the small the small thing is we can't accept a US Customers there because we're not licensed in the US. So yeah, I mean you can have a look at the site It's all open and stuff, but we can't take US customers All right, awesome. I'll still I'll still take a look at it to see what people are betting on Yeah, I think that's gonna wrap it up guys I hope you enjoyed that I hope that was a bit of an eye-opener for a lot of people I was kind of what I was aiming for with this little show and Yeah, fancy. I would like to have you back again to talk about a marketing Marketing versus advertising. I know that's kind of your your forte and that'd be a fun thing to discuss But for now, I think that's gonna be it. Thank you ace. Thank you fancy for joining me But this is the man who's signing off you guys have a good one man