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Bootstrapping in the Age of Blockbuster Budgets Albert Reed Co-Founder/Director of Development Demiurge Studios Latest Version at:

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2 Bootstrapping in the Age of Blockbuster Budgets Albert Reed Co-Founder/Director of Development Demiurge Studios Latest Version at:

3 Introduction  Bootstrapping: Funding a company with no external investment and with little or no personal wealth  Without a means to bootstrap, the indie is in danger  Big budgets present opportunity for small studios  Look at the other lectures:  We Learned the Hard Way So You Don't Have To: How to Outsource Successfully  Multiple Site Game Development  Successful Outsourcing on Triple "A" Games - A Case Study of Forza Motorsport

4 Prerequisites: Individual  Patience: Growth will be slow  Be willing to sacrifice 5 years of competitive earnings  Don’t wager what you can’t afford to lose  Willingness to work on less-than-ideal projects

5 Pre-Requisites: The Team  Don’t got it alone  Need inspiration, pick-me-ups, complementary skills, sanity-checks  Selling an individual is harder  Game industry experience: It will save you time  Sales skill/expertise (not a full-time biz person)  Business consultant  Contacts  Talent

6 Pre-Requisites: Infrastructure  Computers, phones, etc.  Place to work  Try to get office space with your first gig

7 The First Gig: Sales Part 1  Reach out to your contacts  Scour job boards and project pages (,, etc.)  Compete on price versus hiring  Don’t be choosy. Look for isolatable tasks:  Programming: Installers, tools, gravy-features  Art: Bulk environment art, animation, non-essential characters  Demiurge’s first: “Infest!”…

8 The First Gig: Infest  Web to native port  Knew the owner of the company  Got office space and $1000/week for two programmers  Saved $200/week for supplies, soda, t-shirts, “cushion”  Heat problems. Got a door on the bathroom

9 The First Gig: Execution  Your reputation is everything  Set high expectations, meet them  Carefully manage the client relationship  “We’re half a man-day behind…”  Professionalism – blow them away  Don’t be a pushover.  Make trades for schedule  It will gain you respect  Remember you still have nothing to lose  Never stop selling…

10 Building Value: Sales Part 2  One project done, new prospects in the works  Use your new niche. Demiurge went with UnrealEngine  “Never turn down a job you don’t have”  Serious games, installers, ports, box art  Don’t pre-qualify the client, just get a check  Availability be damned!  Make a website, keep it up  Language tips: “We”, “Some other contractors”, “Previously”, “Absolutely”  Handling the “off site” question

11 Building Value: Sales Part 2  Talk to the right people.  Look for business-oriented contacts, avoid HR  Making the case for outsourcing is easier than ever  Lower your rates to land the value-building gig  Console experience, engine experience, Big Name Project  Don’t de-value your work  Never stop selling…  Cast a wide net, then steer the deal

12 Building Value: Negotiating  Long-term projects are the brass ring  “A little bit pregnant” goes a long way  Tools, concept art, experience w/their tech are great  What to do when start/end dates don’t line up  Don’t stress until the deal is assured  It’s still early, don’t get caught up in contract details  They only matter when it’s too late  Hire a good IP/contract lawyer  Reach out for new skills. Leverage your reputation

13 Building Value: Execution  Establish process  Better way to bake a normal map  Off-site task tracking/progress reporting  Scheduling capabilities  Build up a portfolio to sell skills  Start game-development team  Demiurge did this too early

14 Fixed Price vs. Time & Materials  Avoid large fixed price gigs until team is practiced  Nudge gently – in the end the client decides  Leverage benefits of each…

15 Fixed Price  Much riskier  Bigger potential pay-off  More independence  Easier to develop own tools, processes, techniques  Watch out for fixed price AND fixed date  Avoid “incentives”

16 Time & Materials  Steady income (brass ring!)  Harder to profit from, without high-rates or low-cost employees/contractors  Generally a less adversarial client- relationship

17 Pricing  “The only way that you know you left money on the table is if you didn’t get the deal”  Examine costs of the hiring alternative:  Salary + benefits (Health care, 401k, vacation)  Hiring/firing costs (time and $)  Equipment  Is hiring even possible?  Client doesn’t have value of internal talent  Other industry rates will be higher

18 Why to Outsource?  Your team represents difficult to hire developers (perhaps in quantity)  Your team is trained to get up-to-speed quickly on new projects  Your team will inflict a minimal drain on their existing leads  Hiring you does not raise their burn rate which gives them flexibility down the road  You have staff with a variety of expertise; you can put exactly the right person on each task

19 Looking Forward  Define corporate goals early  Culture  Product  Build value and advance goals with every gig  Starting internal development  Big: When you can pitch the team  Small: When you can afford it

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