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Home   >   Self-Publishing   >   Finance   >   Funding our first independent project | Remode diary 1

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Funding our first independent project | Remode diary 1

By on August 21, 2013

This is the first in a series of development diaries from Remode.

For other development diaries, check out the Spilt Milk diaries and Dlala Studios’ first post.

I’m Ella Romanos, CEO of Remode, a game developer based in Plymouth, UK. We’ve been running for nearly six years, and for the first five primarily did work for hire games for online and mobile platforms.  In the last year we started working on our own games too, which is what we have been aspiring to since we started.   I’m writing this diary to focus on our experience of developing and publishing our strategy game ‘Burrow’.  I’m going to talk about what we’re up to month by month, being open about everything from how we’re handing development and publishing, including sharing sales figures, stats, the things that go wrong and what we get right.

A couple of years ago, I followed Andrew Smith’s Spilt Milk Diaries, where he shared the experience of developing his game Hard Lines. I thought it was really brave to be so open and honest, and found the articles really interesting, so I decided that I wanted to do the same.  I talk and write quite a bit about building a studio, which is something I have quite a bit of experience in now, but this is our first real venture into releasing our own game, so this experience is new to me and will be a learning process… hopefully this diary will be useful and interesting to others, and I also hope that feedback from readers will help us in turn.

So how did we get to the point of making this game?  We spent five years building a studio based on work for hire, and it’s hard to change and start making your own games. It’s hard because of the production processes and team structure, it’s hard because you have to take away resources from lucrative accounts and it’s hard because client work is demanding and often ends up having to take priority. It’s hard to justify it financially when you have a burn rate that you have to keep up, and when you’re making profits from work for hire, risking that is scary.

We still wanted to do it though, because we always started this business to make our own games and whilst it’s a risk, we knew we didn’t want to be a purely work for hire studio. We didn’t do it from day one because we wanted to build a sustainable business first, and had seen too many games companies whose entire existence rested on one game, and if the game failed, the whole company failed. That didn’t seem like a sensible strategy to us, so we decided to take the long view, be patient and build a robust business first.  Once we were in a position where we weren’t betting the company on a game, we would start building our own games.  If the game fails, the company shouldn’t fail – I’m not saying it wouldn’t suffer at all, it would make things hard in terms of cashflow and reputation, but we wouldn’t go bust and would have a chance to continue moving forward, which isn’t a position that a lot of studios, particularly smaller independent studios, are in.  I suppose it’s slightly luxurious, but we had to work very hard, for a long time, to get here.

Full disclosure: We did actually build our own game, called Mole Control, and released it on Steam and at retail back when we started the company.  That game did ok, but wasn’t hugely profitable, certainly not enough to reinvest in another of our own games.  The primary reason we did it though was to give us a portfolio and track record to start building our work for hire studio. Without it, we probably wouldn’t have gotten to where we are now.

So, the game we’re making is a Roguelike with Sim elements!  In the backstory, a catastrophic industrial accident involving the emergency detonation of a near-Earth Asteroid leaves a futuristic London (about 150 years from now) as an irradiated ground zero.  Thousands of innocent people are trapped underground in the city’s subterranean areas, which are significantly more developed than we are familiar with today.  As a player, you must use robots originally designed for colonization and mining in outer space to rescue as many civilians as possible.  However, strange tremors are afoot and you soon realize that there is more to the disaster than first meets the eye.

The game is being built in Unity3D, is a freemium game, designed primarily for tablet, but will also be released online, on smartphones and hopefully on Steam.

Burrow is being designed by my business partner, Martin Darby, and we have team members allocated to the project across the programming and art.  We also have internal QA who will be working on the game as we get further into production, and we will also be creating all of the marketing material in-house. The only things we are outsourcing are audio, and the build of the game websites.

For the publishing side, we have been exploring various options, and have recently made a decision on how to proceed with that side, however I’m not going to cover that here as that will be the topic of next post.

We came up with the concept for the game in late 2011.  We knew that the scope of the game would require external funding, and while we had around £100k to put in ourselves, that wasn’t enough. We also knew that whilst the game would cost around £250k to develop, the costs for publishing it would be significantly more.

The options as we saw it were as follows.  Some of these are not mutually exclusive:

  1. Find a publisher and go with a ‘traditional’ model, where the publisher would pay for development as an advance against royalties, would undertake and fund all of the publishing activities such as marketing and distribution, and in return would take ownership of the IP and give us a minority % of royalties once they had recouped their investment.

  2. Find equity investment to cover development and publishing costs, which would be based on our business plan rather than project plan, and give away part of our business in return.

  3. Find full project funding to cover development and publishing costs.

  4. Get a loan to cover development costs (and possibly publishing costs too).

  5. Find a marketing partner who would undertake the publishing role for a fee and possibly some royalty stake.

  6. Find a publishing partner to undertake and fund the publishing side in return for a royalty stake.

We started talking to potential partners around Christmas 2011, and in early 2012 we were awarded £25k from the Abertay Prototype Fund to get the project started.  The terms of the fund are that we pay back the money, with a small amount of interest, from royalties of the game if it should become profitable.  If it doesn’t, we never pay it back.

After we received Abertay funding, we continued discussions with other potential partners through 2012, and spent the summer planning the design of the game, but due to a range of client projects that had to take priority, we were actually only able to start development in October 2012.  At around the same time, Creative England opened up applications for their Regional Growth Fund and we applied for a £100k loan, which we would match, to fully develop the game, and had confirmation in January this year.

Taking a loan is a risk, however we decided that it was the best route for us because:

  1. We are a business that is making money from our work-for-hire projects, so can be confident of being able to pay it back.  A lot of studios are not in this position, and I would not have taken the loan if I had to rely on revenue from the game to pay it back.

  2. It isn’t the same as a bank loan (not that we would have been able to get one!) because it’s not secured.  A secured loan means that the money is guaranteed against your business assets e.g. equipment and revenues – and/or maybe personal assets such as your house or car – so if repayments are missed, the lender can legally claim against that, so could effectively shut the business down to get their money back.  An unsecured loan means that cannot happen and is a key difference for a small business.

  3. We wanted to keep the IP. Whilst I’m not against working with publishers in a traditional model, in fact we’re still exploring that for other projects, we felt that we really wanted to keep ownership of this IP if we could. It is our first title of this size and scope, and we knew that we wanted flexibility on timescales, and on how the game was developed.  We also knew that this game was going to be quite experimental in gameplay and in monetization, and that was much more conducive to us being in control of the direction, whereas publishers look for lower risk projects, particularly from developers without a track record in similar projects  – and rightly so – their existence is about balancing and reducing risk.

We recently reached the point of having a first playable, with the basic functionality in place.  From there, Martin has been working much more on the design and we hope to have that written up soon.   I’ll get him to write about his challenges on that side at some point too.  Once he has finished that, we will be putting together a full schedule and seeing when we might get to alpha!

Stay tuned for my next post, where I’ll explain how we’re tackling the publishing side of the game, and how we came to the decision.

About Zoya Street

I’m responsible for all written content on the site. As a freelance journalist and historian, I write widely on how game design and development have changed in the past, how they will change in the future, and how that relates to society and culture as a whole. I’m working on a crowdfunded book about the Dreamcast, in which I treat three of the game-worlds it hosted as historical places. I also write at Pocketgamer.biz and The Borderhouse.