Projects

Lot of stuff happened… Hajime finished and was sold, we worked on Warlords 2 and Async Racing with Ben Olding, we finished two major contracts and started a couple of other ones.

I must say that project wise I have split feelings. On one hand we did put a lot of stuff out. On the other hand most of our time was used with client IPs, which can be heaven or hell, but never our heaven or hell.

Couple of other small victories I reckon… not entirely relevant for the company has a whole.

Business

I don’t know the exact figures of 2010 yet, but I’m pretty much sure we grew more than 100%. This would mean that 2010 was the year of our stability. While this is somewhat true it is not that black and white. Right now my predictions are that we will match 2010 in the 1st quarter of 2011 and still I’m not happy. My biggest concern is related to passive income. We have not yet found a way to have a steady passive income and the rest simply has too many variables, plus taxes…

Yes, 2010 was good, but we are growing and in a very decisive year in VGS, so we need to really be less dependant of overall market… stuff…

VGS Most Valuable Player

I bet we are the only company in the world with more than two people where 50% of the people are named Pedro Santos. While none of ‘our’ Pedro Santos are in fact and legaly employees of Vortix, both of them have the same spirit of the three guys that started up Vortix: they put their effort into something and make it happen, which is a rare thing nowadays. In my opinion ‘The Pedros’ share the MVP place in 2010.

The Flash Game Space MVP

I really have to make this special note here… There’s this Ben guy better known has benologist. He bootstrapped something we know as Playtomic, which is pretty much awesome and that I won’t describe because you either know it or you should follow the link. When devs were bitching and whinning about blocked links he put pressure on portals and created Portal Blacklist.

And still managed to release games… no doubt, my personal choice for Flash Game Space MVP.

And one last word

Marco, my partner, friend and brother. You are one in a million mate. If we find the other 6000 that are like you, we’ll rule the world! Keep up the good work!

To be successful we have made decisions. We developed our own activities:

1. Sponsorship and licensing because it is our current form of monetizing our core business and our core business is creating games.
2.  Collaboration projects as an low-risk extension of #1.
3. Contracts as a very-low-risk activity that would allow us quick and steady monetization.

Everything we did, was done with a purpose. There are a bunch of things you can do as a flash or game developer. Some devs operate portals, some devs create software that helps other devs, some devs have a day job, all is fair game, but doing things with a purpose allowed us to set goals and each goal that is achieved is a step forward into that purpose.

It boils down to this:

Do whatever you have to do to be able to do whatever you want to do.

Less than that it’s either a hobby or a bad model. What you need to ask yourself is:

1. What do you do best? Capitalize on that.
2. What do you want to do? Improve on that.

Never stop moving, choose what you have to do and choose what you want to. Be smart, create value, raise the bar, raise your worth.

To finish, keep in mind that you, like us, are probably small fish in a world of sharks. Here’s something worth reading: The Bootstrapper’s Bible. That should put it in a wonderful, motivating new perspective.

1. We determine cost, scope and time frame. Only once we were given a budget and it worked alright, but we prefer to determine the cost ourselves.
2. Cost to the prospect client is directly related with scope and time frame. If we assume we do the contract it is because we have the skill to do it and it is not our content, this is purely engineering/design work, nothing else. This means that any other related factor is irrelevant for us. We don’t care what is the content or entertaining value, we don’t care if we are considered cheap or expensive and we don’t care if anyone thinks we are having too much profit.
3. We care about the end result and will not charge extra if any requested change or additional feature is within scope and time frame.
4. Larger projects will be paid by milestone while smaller projects will be paid on delivery.
5. Payments on delivery are not dependent of anything, like developers getting their game sponsored. We delivered, if it is accepted we expect immediate payment.

Sounds a bit harsh doesn’t it? That’s because our core business is creating our own games. A client-centric company needs the clients to survive since they are dependent of contracts. A flash game developer creates (or should be able to create) its own content, therefor its own value. If we have an agreement, we will do the project as if it was our own, the client is not treated as a client (in a bad way), but as a partner, unless of course they treat us as supplier (in a bad way also). The problem with a couple of contracts or contract discussions was exactly this: some clients (or prospect clients) tend to consider flash game developers as a lesser entity, like they were amateurs. Our experience says that this is more evident in the flash game space where prospect clients started the discussion by saying “I don’t think you are good enough”. Great, find someone else that is…

Bottom line is that contracts, if not done with the right people are problematic. The right people are the ones that are don’t consider to be in a higher position because they pay but that consider hiring us as an added value to their project. These are the clients we want to deal with, the ones that the points raised above are “nothing special”.

Still the worst part of contracts is getting started. We feel that announcements (blog and forums mostly) served very little for getting new contracts. On the other hand, word of mouth was what brought us more contracts. I think I won’t be far from truth if I say that all contracts started by either our games being known which led to good collabs or by speaking with people directly thus creating network. I can recall a couple of emails we got from our forums, but those never left the proposal stage.

Now you know how the activities of our business model work to us. I’ll finish this series by wrapping it all up, drawing some conclusions and babbling on how you can adapt your own reality to your own business model.

Most flash game developers, be it coders or artists, usually lack the other side of the coin. Many coders don’t have design and/or artistic skills and many designers/artists don’t have coding skills. This gap became deeper with Actionscript 3 for well known reasons.

Collaborations the activity that we planned the most. The main goal was to monetize schedule holes. To do this we started by marketing it at FGL. First slowly and carefully, we were absolutely clear that we were not looking for “any game”, but rather targeting potentially high profile projects. We behaved a lot like a sponsor, checking every proposal we got by email, discussing the pros and cons of each. About a handful of projects never started, one was never sold (or put to sale as far as I know) and a couple did well.

Now it is important to determine what “doing well” exactly means. Maybe you are imagining that doing well is getting 5 million plays or we earning $5000 per game. It isn’t. We clearly defined the objectives we wanted from Collaborations:

1. Our collaboration must create enough value in the game so that the developer that proposed the game makes more money than he would if it wasn’t for us. All games that were sold achieved this.
2. Our percentage of the collaboration must cover our cost. I didn’t crunch numbers on this one, but I think we rarely achieved this. It is always a win situation for us since like I mentioned earlier, our initial motivation was to monetize schedule holes that would never make any money.

It was a bit disheartening that as soon as developers create a hit game with us they prefer to hire us. I admit that from a commercial point of view that is the right call and we say from the beginning that we don’t won the IP in any way so we really have no take on the subject. But from a personal point of view, I feel sad that our share of risk and support is left behind and given a lower priority against money… I don’t let these personal feelings get in the way and I share the same amount of respect and even friendship, but it’s a bit… sad…

Final thoughts on collabs and why we did it this way: we monetized, created value for ourselves and developers that worked with us which was exactly what we wanted to do. To achieve this we didn’t consider this activity as part of sponsoring and licensing since we never owned the process of production and sales. Collaborations are half sponsorship and half contacts. That was the only way to fit it into our business model.

As I think it notices in other posts in our blog, I still feel that developers are not fully aware of where they are positioned in the flash game market. I’m not 100% sure but I think that what I spoke most with other developers was about business. I admit I feel quite comfortable with the business side of things and I understand that with the average age and work experience of most flash game developers, business is not something they feel comfortable or knowledgeable.

On the other hand there’s the problem of developers that feel they have a life of experience because they sold one game for $100. They use the word “noob” like there were no mirrors left on Earth. I would add to these a significant number of developers that advice others not to do something that they haven’t tried.

And where does a business model fit into this? Well, most of what defines a business model is well known by developers. What is relevant to discuss, in my opinion, is what are the options available in terms of activities and revenue. Many developers ask me how did Vortix achieve this or achieve that. How do we do it? How much do we earn… stuff like that… I can only be theoretical about it because I’m not fully aware the most sensitive piece of information: THE DEVELOPER!

You need to know yourself, you need to understand, not business but your business and you need to neglect all opinions that are negative in nature to what models, activities and revenue streams that are available to you as a flash game developer.

In the next few days I’ll address Sponsorship and Licensing, Collaborative Projects and Contract Projects as activities and their revenues but I feel that what is important is how do these activities affected us at Vortix so you can relate to your own business model. Because there is no perfect or good business model, there’s only YOUR business model.

So life is treating us so-so. A couple of contracts are approaching the end and after speaking with Marco we concluded that we won’t be doing contract work for a good while. We have too many good stuff right now to work on that has caught way too much dust.

Looking back over the past few months, a lot of what we did was neglected because of contracts. They were alright in a way, some for the money, some for the knowledge, some for something else. But unlike our own games, there’s always a part that is missing, regardless of how good the project is. We feel that has to stop and that what moves us forward is our ability to pursue what we want: pride and happyness.

I also feel that both can go hand in hand with stability and stability is what we found in the past months. We need to step up and do our thing. We need to improve what we did for us.

Project wise, that means that we have to put Hajime on FGL, we have to decided what we want for M:A:D and we have to have time for our most promising game. Code wise this means that I have to reflect if we want to keep Bold Pixel public considering that the current version suits our needs more than it suits the initial user friendliness. I strive to keep things simple, to impose convention over configuration as a standard. Right now I’m not that sure that this will fit developers needs to the point that BPE is helpful.

We’ll see about that in the next couple of weeks. Thanks for reading and the therapy session.

Vlad out!

A lot of people has approached me on MSN lately wondering what we were up to since there was no news from us for some time. Our blog hasn’t been updated with the exception of Marco’s previous post, we haven’t used Twitter lately or done our daily visit to FGL.

Some have wondered if everything is ok and so on. Well, it is! I’m currently working on a big contract that we will let you know once it’s public. This contract is the major time consuming ‘thing’ that has made hide in our dev cave and one very nice addition to it is that it is using our Bold Pixel Engine framework, which means that we will release version 1 as soon as we deliver the project.

Marco is juggling several things. For starters, this contract also involves art… well actually it involves the whole product, so art is part of it. He has delivered all known assets and he is currently working with a programmer that is doing some really cool things for us. The name of this fellow is Pedro, so give him a round of applause because he really deserves it! Trust me, he does and you’ll know about it soon. Marco also worked on Palisade Guardian 2, which I’ve failed to announce… so… I owe Mark Loika that one!

So apart from the forced disappearance d in our dark dev cave, everything is well, right? Not really… M:A:D, the game that we’ve been talking about is completely stopped for the reasons mentioned above, which is kind of sad since it was going out really well and we are already aware that maybe some other projects will get a higher priority before we can resume its development. Can’t win it all can we?

So I guess this is just a heads-up for everyone and we’ll be back soon.

I know it’s irrelevant, but I’m brainstorming so bear with me…

Technology was… refreshing!

Oh well, what to say… we used to work with Torque Game Builder and C++, mostly because Torque Game Builder had some… erm… issues. In those days, that damn thing didn’t know how to render a font on screen properly, so, to get a commercial game out, we couldn’t trust it and we needed to change the actual C++ engine.

Actionscript does have it’s issues also, first and foremost, it’s not a game engine, nor there’s any proper commitement from Adobe to change that. But game developers are used (and should be used) to make the wrong feel right and Actionscript is a bag of good suprises in that department.

Money was good!

Money is not only licensing… we did more stuff… but let’s start with the part that interests most developers.

Licensing

While I still believe that the topmost games of the casual download market space do make more money than topmost flash games. But download games take more time and more people. Another thing with the casual games is that it is a hit market and the vast majority of the money goes to a tiny minority of the people.

We released one download game and we were working on the second when we ran to an halt: we had a lot of proposals for distribution, none for publishing. If you don’t know what this means, basically we didn’t have any upfront money to work and that would kill us in a couple of months.

I would love to share with you real money values but under contract of the download game I cannot, therefor, I’ll give you comparasion figures. I calculated a revenue ratio:

revenue ratio = revenue / team members / months of development

Balloon Bliss has a revenue ratio of 1, because it’s what I want to compare with. Our first game, Tech Wars was a disappointment, mostly because we didn’t know what we were doing, but ok… still the revenue ratio is 1. This means that the revenue per month work per developer involved is exactly the same as a download game… hmmmm… for a game that is less market friendly.

Atomik Kaos and Atomik Kaos 2 have a ratio of 6 and 7.5 respectivelly and Lucy Swashbuckler has a ratio of 2.25.

Average is 4 times more revenue per team member per month worked than casual download market.

Contracts and Collaborations

We had some great ones and some bad ones, most of them were great ones though! Some of the contracts are yet to hit the web, which is a shame because we are very proud of them, but this section is about money so let’s cut the chase… is it good or not to have contracts and collaborations?

It depends… Using the exact same ratio, we had contracts that ranged from 1 to 10 and collabs that ranged from 0 to 36.72. The problem is that 0 there… some developers started projects with us, received assets and then dropped the project without a word. That’s nasty.

I think that we will have less collabs and more contracts in the future, which is ok I guess, but although a higher risk, it’s potentially more profitable to have a collab than a contract. Something we’ve discussed a lot is to what extent is more interesting to get these gigs instead of our own game development? On average our own game development is more profitable, but it has the highest risk, so I guess it’s a matter of balancing things.

Conclusions…

While we did more money per team member per month, we really need to sort how to balance between contracts, collabs and internal production.

Contracts offer 0 risk but lower income, internal production presents the higher risk with a potential higher income and collabs are somewhere in the middle. Since collabs were the more profitable the also the most problematic, I think that what we need to balance is internal vs contracts and leave collabs drop unless we get a really interesting project.

Visibility and contacts

Like it or not, a business is as viable as is it visible unless you are running some illegal thing, then it’s the exact opposite.

About a year ago our games were played by roughly ten thousand players. In a year we got around ten million players, that’s the equivalent to our country’s population, so kind of a milestone for us.

Our visibility, simply boosted and most of it happened because of the good people we had the pleasure to work with.

Flash Game License

All started here: please click here if you don’t know what it is… The services offered by the portal allowed all our primary and exclusive game sales, but it did not end there. Adam in particular has been always open to hear our complaints and suggestions and drive business our way. I’m sure we would do it sooner or later, but not has fast and as hassle free as while working with this wonderful group of people.

Portals

All the portals that worked with us. All, from the smallest to the biggest, have part in the visibility of our work but more important, all of them cared. I never felt that these portals were some faceless institutions that overloaded us with paperwork or false intentions. They wanted the best for their service and worked with us to deliver it. Sometimes it was possible, other times wasn’t.

I’ll open a new link section to be sure I don’t leave anyone out… and drive a little traffic their way too, why not?

Conclusion and future plans

This first year was very good. Next year is a bit edgy for us. We want to continue growing but we need to sort what our bets are and how we will manage somethings.

I don’t doubt for a minute that I’ll be here a year from now making a year 2 balance.

See you all soon,
Vlad