what do they need 400000$ for?

hotd0g

So UWE has received at least 10000 preorders (90% of which are special editions)
My question is: what are the things that are so expensive they need 400 grand to finance them?
I'm just wondering, especially since they only have a crew of ~4 people and a small office to work in.

zimzum

you're assuming the game cost that much to make. while there are costs involved there's also such a thing as profit...

WarLover

Not to mention way more than 4 guys are working on the game.
Where have you been the past year(And more)?

IeptBarakat

and don't forget the cost of snack time.

Skyforger2

Im not living in Sanfrancisco but you could start with a look on the Office space rental prices.

douchebagatron

it's not just 4 people working on the game. they've contracted out a lot of the art and other things to 3rd parties. plus, 400K for 4 people, minus 100k for general contracting, bills, space rental and whatnot over 2 years, leaves 300k for 4 people leaves 37.5k a year. they're not exactly making bank. yet. (mods feel free to remove this if i'm spot on they don't people to know how much they make. or for whatever reason i guess. you're the mods.)

Delphic

An Office, employing FAR more than 4 more these days (what's the figure now? over 20+?), paying Valve.

Plus buying assets from third parties etc.

Oh and % profit, company value for their next game.

Also $380,000 if 90% = $40 and 10% = $20.

hotd0g

<!--quoteo(post=1778733:date=Jul 14 2010, 10:39 AM:name=WarLover)--><div class='quotetop'>QUOTE (WarLover @ Jul 14 2010, 10:39 AM) <a href="index.php?act=findpost&pid=1778733"><{POST_SNAPBACK}></a></div><div class='quotemain'><!--quotec-->Not to mention way more than 4 guys are working on the game.
Where have you been the past year(And more)?<!--QuoteEnd--></div><!--QuoteEEnd-->

But how much are actually on UWE's payroll? We know there's Charlie, Max, Cory and some other dude i can't remember right now...
I'm saying there are also alot of volunteers who contribute to the project just for the heck of it, but don't get a slice of that 400k.

So how much profit is involved here?

Chris0132

Games are expensive to make. Consider they will need to pay back all their investors who funded them before the preorders.

TrC

Trolled, gj OP

Kouji_San

I don't really think they have to reveal that though. And as the simple calculations above have already said, it is quite reasonable :P

zimzum

<!--quoteo(post=1778738:date=Jul 14 2010, 11:42 AM:name=hotd0g)--><div class='quotetop'>QUOTE (hotd0g @ Jul 14 2010, 11:42 AM) <a href="index.php?act=findpost&pid=1778738"><{POST_SNAPBACK}></a></div><div class='quotemain'><!--quotec-->So how much profit is involved here?<!--QuoteEnd--></div><!--QuoteEEnd-->
if and when they go public you can be privy to that information. for now, the answer is "none of your business".

hotd0g

Why would it be none of my business? If i were to put my money in this game, i think i'd be entitled to know as to what happens to it.

Kouji_San

All you are buying is a license to use the game when released and support the development atm. And of course get their eternal gratitude. What makes you think you are "entitled" to this private information then :P

Squeal_Like_A_Pig

We have 7 people in the office now, and paid employees offsite include 3 riggers/animators, environment artist, mapper, sound guy, music, and several art contractors who are paid per asset. +Rent, utilities, and other miscellaneous expenses. Still a small team and small burn rate compared to most companies, but we are not making a profit.

--Cory

Drown

My brother-in-law runs a three person ISP and their operating costs are around 400'000 per year.

edit:
Just saying 400k isn't as much as you think...

Kouji_San

<!--quoteo(post=1778757:date=Jul 14 2010, 05:58 PM:name=Squeal_Like_A_Pig)--><div class='quotetop'>QUOTE (Squeal_Like_A_Pig @ Jul 14 2010, 05:58 PM) <a href="index.php?act=findpost&pid=1778757"><{POST_SNAPBACK}></a></div><div class='quotemain'><!--quotec-->but we are not making a profit.

--Cory<!--QuoteEnd--></div><!--QuoteEEnd-->
The fact that you're working and completing a game like NS2 is a good profit though :D

hotd0g

<!--quoteo(post=1778757:date=Jul 14 2010, 10:58 AM:name=Squeal_Like_A_Pig)--><div class='quotetop'>QUOTE (Squeal_Like_A_Pig @ Jul 14 2010, 10:58 AM) <a href="index.php?act=findpost&pid=1778757"><{POST_SNAPBACK}></a></div><div class='quotemain'><!--quotec-->We have 7 people in the office now, and paid employees offsite include 3 riggers/animators, environment artist, mapper, sound guy, music, and several art contractors who are paid per asset. +Rent, utilities, and other miscellaneous expenses. Still a small team and small burn rate compared to most companies, but we are not making a profit.

--Cory<!--QuoteEnd--></div><!--QuoteEEnd-->

Awesome. Thanks for the reply.

RobB

<!--quoteo(post=1778757:date=Jul 14 2010, 05:58 PM:name=Squeal_Like_A_Pig)--><div class='quotetop'>QUOTE (Squeal_Like_A_Pig @ Jul 14 2010, 05:58 PM) <a href="index.php?act=findpost&pid=1778757"><{POST_SNAPBACK}></a></div><div class='quotemain'><!--quotec-->we are not making a profit.

--Cory<!--QuoteEnd--></div><!--QuoteEEnd-->

I can only hope you're not eaten and stripped of licenses by "the big on's".
That's even painfull just thinking about it.

BubbaJoe

<!--quoteo(post=1778732:date=Jul 14 2010, 10:38 AM:name=zimzum)--><div class='quotetop'>QUOTE (zimzum @ Jul 14 2010, 10:38 AM) <a href="index.php?act=findpost&pid=1778732"><{POST_SNAPBACK}></a></div><div class='quotemain'><!--quotec-->you're assuming the game cost that much to make. while there are costs involved there's also such a thing as profit...<!--QuoteEnd--></div><!--QuoteEEnd-->

How does one try to make a profit without a shipping product? They have the money from the investors and the pre-orders, but not really any sustainable income (yet).

Take a $1M loan, say pay $300k for office/equipment/etc, $200k for contract work, $400k for employees, at the end of the year you have $100k left, however, that is not profit. But if at the end of the year they ship the game and make $5M, then -that- becomes profit. (totally BS numbers btw)

Just saying "profit" is not important at this point, funding is yes, however the most important thing is to make the most bad-ass game ever so when its finally released you pay back the investors and enjoy the results of your hard work.

zimzum

you missed my subtle point. whatshisname was complaining about the amount of money pulled in and wanted to know where it was going. i was simply saying, it doesn't matter where the money goes or how much money they make - not implying they were making profit at this point....

Mr. Epic

ns2 has huge potential on steam, all it takes is a 50% off "naturally awesome" natural selection 2 deal weekends and it could explode.

Slycaster

Let's do some math. Assuming NS2's development really kicked off in 2007 when Cory joined up, let's do basic figuring.

If Cory/Max/Charlie/Matt all make, say 40k (in SA, this is probably a below median wage for sure) a year, we're running around 3 years of salary: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$640,000<!--colorc--></span><!--/colorc-->
Office Space, rent is gonna be at least 1500 a month with utilities: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$50,000<!--colorc--></span><!--/colorc-->
Let's add Kurt for another 40k: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$40,000<!--colorc--></span><!--/colorc-->
Office supplies, start up, moving costs/licensing costs: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$30,000<!--colorc--></span><!--/colorc-->

Now let's add extra help, there's no easy way to calculate this, but I'll give a guess for the figuring sake:
Sound Effects: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro--> $40,000<!--colorc--></span><!--/colorc-->
Soundtrack (David John): Paid per minute of music, NS2 is probably shooting for 35, most likely <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$35,000<!--colorc--></span><!--/colorc-->
Dux (Payroll mapper): I'm assuming dux is making full time pay somewhere around 30k/year for the last 2 years. <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$60,000<!--colorc--></span><!--/colorc-->
Breadman (Payroll mapper) New, same as dux's situation, <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$15k<!--colorc--></span><!--/colorc--> invested so far?
Other mapping payroll: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$15k<!--colorc--></span><!--/colorc-->
Environmental Art: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->20k<!--colorc--></span><!--/colorc-->
Animation/Rigging: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->40k<!--colorc--></span><!--/colorc-->
Producer: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->30k<!--colorc--></span><!--/colorc-->
Paypal fees: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->15k<!--colorc--></span><!--/colorc-->

Total estimated cost of NS2 currently: <!--coloro:#FF0000--><span style="color:#FF0000"><!--/coloro-->$1,030,000<!--colorc--></span><!--/colorc-->
This number is probably on the low end actually. There probably is costs I'm not figuring in, but we know NS2 has over <!--coloro:#00BFFF--><span style="color:#00BFFF"><!--/coloro-->15,000<!--colorc--></span><!--/colorc--> pre-orders and at 90% SE attach rate, thats 13,500 for <!--coloro:#00FFFF--><span style="color:#00FFFF"><!--/coloro-->$540,000<!--colorc--></span><!--/colorc-->. And another <!--coloro:#00FFFF--><span style="color:#00FFFF"><!--/coloro-->1,500<!--colorc--></span><!--/colorc--> regular editions for: <!--coloro:#00FFFF--><span style="color:#00FFFF"><!--/coloro-->30,000<!--colorc--></span><!--/colorc-->

<!--coloro:#FFFF00--><span style="color:#FFFF00"><!--/coloro-->570,000<!--colorc--></span><!--/colorc--> from pre-orders, and the angel investor numbers that were thrown out before was somewhere around <!--coloro:#FFFFFF--><span style="color:#FFFFFF"><!--/coloro-->500,000 <!--colorc--></span><!--/colorc-->for a total of <!--coloro:#FF0000--><span style="color:#FF0000"><!--/coloro-->1,070,000<!--colorc--></span><!--/colorc-->. That puts NS2's estimated income at the moment, at near zero. Cory just stated they are not making a profit, so obviously NS2's development is still debt based.

NS2 is well over a million dollar game, for a studio of 4 to eventually 7 in house people working seriously for little over 3 years. My figures could certainly be out whack both up or down, but games aren't cheap to make, at all. We need to appreciate what UWE is doing and have as much faith as we can. :)

StarClaws

All wrong. They feed twinkies to hampsters and those cute little critters animate and code the game while they play DDR all night long! Sorta like valve.

<a href="http://www.youtube.com/watch?v=T9sz9QzsWXc" target="_blank">http://www.youtube.com/watch?v=T9sz9QzsWXc</a>

schkorpio

<!--quoteo(post=1778748:date=Jul 15 2010, 01:49 AM:name=hotd0g)--><div class='quotetop'>QUOTE (hotd0g @ Jul 15 2010, 01:49 AM) <a href="index.php?act=findpost&pid=1778748"><{POST_SNAPBACK}></a></div><div class='quotemain'><!--quotec-->Why would it be none of my business? If i were to put my money in this game, i think i'd be entitled to know as to what happens to it.<!--QuoteEnd--></div><!--QuoteEEnd-->
are you worried that they might have misspent your $20? seriously man, thats pathetic.

xposed-

Having a net profit of $0 does not necessarily mean a business isn't making money. Net profit is leftover money after _all_ expenses have been paid, including employee wages. UWE is definitely making some healthy cash that can comfortably pay for all of it's outgoings and employee's which is respectable even for a full time team of 7, just doesn't mean they have a mountain of it left over after everything is said and done per financial year :)

Thaldarin

Games need extravagant amount of money? Never! I say the $70 Million to create the Fallout MMO is a sham and they're all embezzling! EMBEZZLING!!!

Jimyd

<!--quoteo(post=1778827:date=Jul 14 2010, 12:29 PM:name=Slycaster)--><div class='quotetop'>QUOTE (Slycaster @ Jul 14 2010, 12:29 PM) <a href="index.php?act=findpost&pid=1778827"><{POST_SNAPBACK}></a></div><div class='quotemain'><!--quotec-->Let's do some math. Assuming NS2's development really kicked off in 2007 when Cory joined up, let's do basic figuring.

If Cory/Max/Charlie/Matt all make, say 40k (in SA, this is probably a below median wage for sure) a year, we're running around 3 years of salary: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$640,000<!--colorc--></span><!--/colorc-->
Office Space, rent is gonna be at least 1500 a month with utilities: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$50,000<!--colorc--></span><!--/colorc-->
Let's add Kurt for another 40k: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$40,000<!--colorc--></span><!--/colorc-->
Office supplies, start up, moving costs/licensing costs: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$30,000<!--colorc--></span><!--/colorc-->

Now let's add extra help, there's no easy way to calculate this, but I'll give a guess for the figuring sake:
Sound Effects: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro--> $40,000<!--colorc--></span><!--/colorc-->
Soundtrack (David John): Paid per minute of music, NS2 is probably shooting for 35, most likely <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$35,000<!--colorc--></span><!--/colorc-->
Dux (Payroll mapper): I'm assuming dux is making full time pay somewhere around 30k/year for the last 2 years. <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$60,000<!--colorc--></span><!--/colorc-->
Breadman (Payroll mapper) New, same as dux's situation, <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$15k<!--colorc--></span><!--/colorc--> invested so far?
Other mapping payroll: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$15k<!--colorc--></span><!--/colorc-->
Environmental Art: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->20k<!--colorc--></span><!--/colorc-->
Animation/Rigging: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->40k<!--colorc--></span><!--/colorc-->
Producer: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->30k<!--colorc--></span><!--/colorc-->
Paypal fees: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->15k<!--colorc--></span><!--/colorc-->

Total estimated cost of NS2 currently: <!--coloro:#FF0000--><span style="color:#FF0000"><!--/coloro-->$1,030,000<!--colorc--></span><!--/colorc-->
This number is probably on the low end actually. There probably is costs I'm not figuring in, but we know NS2 has over <!--coloro:#00BFFF--><span style="color:#00BFFF"><!--/coloro-->15,000<!--colorc--></span><!--/colorc--> pre-orders and at 90% SE attach rate, thats 13,500 for <!--coloro:#00FFFF--><span style="color:#00FFFF"><!--/coloro-->$540,000<!--colorc--></span><!--/colorc-->. And another <!--coloro:#00FFFF--><span style="color:#00FFFF"><!--/coloro-->1,500<!--colorc--></span><!--/colorc--> regular editions for: <!--coloro:#00FFFF--><span style="color:#00FFFF"><!--/coloro-->30,000<!--colorc--></span><!--/colorc-->

<!--coloro:#FFFF00--><span style="color:#FFFF00"><!--/coloro-->570,000<!--colorc--></span><!--/colorc--> from pre-orders, and the angel investor numbers that were thrown out before was somewhere around <!--coloro:#FFFFFF--><span style="color:#FFFFFF"><!--/coloro-->500,000 <!--colorc--></span><!--/colorc-->for a total of <!--coloro:#FF0000--><span style="color:#FF0000"><!--/coloro-->1,070,000<!--colorc--></span><!--/colorc-->. That puts NS2's estimated income at the moment, at near zero. Cory just stated they are not making a profit, so obviously NS2's development is still debt based.

NS2 is well over a million dollar game, for a studio of 4 to eventually 7 in house people working seriously for little over 3 years. My figures could certainly be out whack both up or down, but games aren't cheap to make, at all. We need to appreciate what UWE is doing and have as much faith as we can. :)<!--QuoteEnd--></div><!--QuoteEEnd-->

Don't they have like an angel investor or something, that gave them like 500k? Or am I thinking wrong.

Basically, they are at the point that by the end of this year, they got to release NS2. That way they can continue to refine the game and support the company into the future.

Of course there could be a another Zen of Sudoku type of game on the side they could be making to be released around Christmas(that we don't know of), if they need to push back to Q1 2011(possibly).

yourbonesakin

<!--quoteo(post=1778992:date=Jul 14 2010, 11:28 PM:name=Jimyd)--><div class='quotetop'>QUOTE (Jimyd @ Jul 14 2010, 11:28 PM) <a href="index.php?act=findpost&pid=1778992"><{POST_SNAPBACK}></a></div><div class='quotemain'><!--quotec--><!--quoteo(post=1778827:date=Jul 14 2010, 03:29 PM:name=Slycaster)--><div class='quotetop'>QUOTE (Slycaster @ Jul 14 2010, 03:29 PM) <a href="index.php?act=findpost&pid=1778827"><{POST_SNAPBACK}></a></div><div class='quotemain'><!--quotec-->
Let's do some math. Assuming NS2's development really kicked off in 2007 when Cory joined up, let's do basic figuring.

If Cory/Max/Charlie/Matt all make, say 40k (in SA, this is probably a below median wage for sure) a year, we're running around 3 years of salary: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$640,000<!--colorc--></span><!--/colorc-->
Office Space, rent is gonna be at least 1500 a month with utilities: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$50,000<!--colorc--></span><!--/colorc-->
Let's add Kurt for another 40k: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$40,000<!--colorc--></span><!--/colorc-->
Office supplies, start up, moving costs/licensing costs: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$30,000<!--colorc--></span><!--/colorc-->

Now let's add extra help, there's no easy way to calculate this, but I'll give a guess for the figuring sake:
Sound Effects: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro--> $40,000<!--colorc--></span><!--/colorc-->
Soundtrack (David John): Paid per minute of music, NS2 is probably shooting for 35, most likely <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$35,000<!--colorc--></span><!--/colorc-->
Dux (Payroll mapper): I'm assuming dux is making full time pay somewhere around 30k/year for the last 2 years. <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$60,000<!--colorc--></span><!--/colorc-->
Breadman (Payroll mapper) New, same as dux's situation, <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$15k<!--colorc--></span><!--/colorc--> invested so far?
Other mapping payroll: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->$15k<!--colorc--></span><!--/colorc-->
Environmental Art: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->20k<!--colorc--></span><!--/colorc-->
Animation/Rigging: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->40k<!--colorc--></span><!--/colorc-->
Producer: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->30k<!--colorc--></span><!--/colorc-->
Paypal fees: <!--coloro:#FF8C00--><span style="color:#FF8C00"><!--/coloro-->15k<!--colorc--></span><!--/colorc-->

Total estimated cost of NS2 currently: <!--coloro:#FF0000--><span style="color:#FF0000"><!--/coloro-->$1,030,000<!--colorc--></span><!--/colorc-->
This number is probably on the low end actually. There probably is costs I'm not figuring in, but we know NS2 has over <!--coloro:#00BFFF--><span style="color:#00BFFF"><!--/coloro-->15,000<!--colorc--></span><!--/colorc--> pre-orders and at 90% SE attach rate, thats 13,500 for <!--coloro:#00FFFF--><span style="color:#00FFFF"><!--/coloro-->$540,000<!--colorc--></span><!--/colorc-->. And another <!--coloro:#00FFFF--><span style="color:#00FFFF"><!--/coloro-->1,500<!--colorc--></span><!--/colorc--> regular editions for: <!--coloro:#00FFFF--><span style="color:#00FFFF"><!--/coloro-->30,000<!--colorc--></span><!--/colorc-->

<!--coloro:#FFFF00--><span style="color:#FFFF00"><!--/coloro-->570,000<!--colorc--></span><!--/colorc--> from pre-orders, <!--sizeo:7--><span style="font-size:36pt;line-height:100%"><!--/sizeo-->and the angel investor numbers that were thrown out before was somewhere around <!--coloro:#FFFFFF--><span style="color:#FFFFFF"><!--/coloro-->500,000 <!--colorc--></span><!--/colorc--><!--sizec--></span><!--/sizec-->for a total of <!--coloro:#FF0000--><span style="color:#FF0000"><!--/coloro-->1,070,000<!--colorc--></span><!--/colorc-->. That puts NS2's estimated income at the moment, at near zero. Cory just stated they are not making a profit, so obviously NS2's development is still debt based.

NS2 is well over a million dollar game, for a studio of 4 to eventually 7 in house people working seriously for little over 3 years. My figures could certainly be out whack both up or down, but games aren't cheap to make, at all. We need to appreciate what UWE is doing and have as much faith as we can. :)<!--QuoteEnd--></div><!--QuoteEEnd-->
Don't they have like an angel investor or something, that gave them like 500k? Or am I thinking wrong.
<!--QuoteEnd--></div><!--QuoteEEnd-->
Answer to your question was in the text you quoted. So, yes :D

Froibo

It amazes me that there is still a significant amount of people that think game developers aren't real people who need to eat.

Faskalia

<!--quoteo(post=1779008:date=Jul 15 2010, 07:10 AM:name=Froibo)--><div class='quotetop'>QUOTE (Froibo @ Jul 15 2010, 07:10 AM) <a href="index.php?act=findpost&pid=1779008"><{POST_SNAPBACK}></a></div><div class='quotemain'><!--quotec-->It amazes me that there is still a significant amount of people that think game developers aren't real people who need to eat.<!--QuoteEnd--></div><!--QuoteEEnd-->

Of course they need to eat.
However no one in the gaming industry has an anus. Hence they all live on a carefully (and expensively) crafted diet, that makes sure that digestion leaves no waste.

So feeding a gamedeveloper should account for 1.5 times feeding a normal person. Plus an additional 10k medical bill per year, if they are not mentally stable enough to keep with their diet.