The Opportunities And Dangers Of Going Indie

[Three indie developers in different stages in their evolution -- Tiger Style Games (Spider: The Secret of Bryce Manor), Haunted Temple Studios (Skulls of the Shogun), and Uppercut Games (Epoch) discuss the pros and cons of the move from big studio to indie.]

While many developers harbor dreams of going indie, for many, it remains just a dream. That's because financing a business -- and then keeping its doors open -- can be quite the challenge, say those who have actually made the transition.

But, of the three who Gamasutra interviewed recently -- each one at a different stage in that transition -- not one regretted making the move.

For instance, Randy Smith opened Tiger Style Games two years ago, having been at Electronic Arts in Los Angeles for two and a half years, most recently as creative director/lead designer on the Steven Spielberg project -- code named LMNO -- that never shipped.

Prior to that, he had been a consultant at EA, and previously did stints at Ubisoft in Montreal and at Lyon, France-based Arkane Studios. His first two jobs were at Cambridge, MA-based Looking Glass where he was a designer on the Thief series and then he shifted over to Ion Storm where he continued on the Thief series as project director. All told, he worked 14 years at major studios.

But, in year-end 2008, as the weak economy convinced EA to downsize, Smith found himself jobless, and he decided to take advantage of the situation.

"Becoming an indie was something that had been in my head for some time," he recalls three years later. "And it seemed to me the perfect time to do something with the iPhone given the fact that Apple had just fired up the App Store with some very early games. It felt like a new, exciting frontier to me and, given the low overhead needed to get involved, I decided it would be an easy place to get started and fulfill my dream."

Although all his experience had been in PC and console games, Smith looked forward to creating the simpler iOS titles which required smaller teams and shorter development cycles.

One of the biggest advantages of moving into the iPhone space was the minimal funding it required, Smith says.

"There was no need to romance publishers to make a publishing deal or to spend tens of thousands of dollars for a development kit," he explains."In fact, when we started, there weren't even any publishers in existence for the iPhone, while now you have companies like Chillingo and Gameloft. All we needed was a cheap license, the SDK, and we were ready to start plugging away."

But keeping a new company running is more than just creating good product, as Smith quickly discovered. First off, there are decisions to be made. Will he have employees? Will there be investors? Will there be an office -- or will a virtual company suffice?

"It wasn't all that difficult," says Smith. "In fact, it was surprisingly easy -- one day I was unemployed, the next I was working for myself. I needed to assemble a team, but I had plenty of contacts in the industry who were interested in pursuing this endeavor with me, both part time and fulltime."

Tiger Style Games functions as a co-op -- no one earns a penny until the game ships and makes money. The downside is that everyone, including Smith, works for a long time without being paid. The upside is that the team gets "lifetime royalties" in proportion to the effort they put into the project.

"This is a business where people do get rich, but if you're in a salaried position working at a large, publicly traded corporation, it's very unlikely management has any intention of making you rich," he says.

"What I really love about our model is that it helps reward everybody in a way you wouldn't see in a large studio," says Smith. "It also puts everyone in the same boat, trying to make the game as good as possible. So everybody is motivated to put in just a little bit more effort, to collaborate more, and to make the game better because then it will sell better and the money earned goes to them, not just the executives. It also means that everyone takes a piece of the risk."

Spider: The Secret of Bryce Manor

Smith's team took the risk on its first game -- Spider: The Secret of Bryce Manor -- released in August, 2009. The good news is that it was a critical and a reasonable commercial success, up at the top of the sales charts and the winner of awards and high scores from the press.

Now the Tiger Style team is on its second still-unnamed title -- an "action/adventure/exploration/emergent behaviors iOS game in which you play an astronaut exploring a cave on Mars where life has been discovered," according to Smith. He hopes to ship later this year if all goes well. He has between 12 and 17 mostly part-time people on the project which, so far, has taken 15 months.

"When we ship, we will have worked just shy of two years on the game," says Smith, "which is a very long time for an iOS game. But we've got a lot of polish, a lot of features, and, most importantly, we spent a very long time in pre-production because there's a fair amount of innovative, experimental stuff going on and we really wanted to make sure we understood them well before we went into production."

Smith's strategy -- and his best recommendation to other indie startups -- is to remain self-funded by earning enough from the first project to build up enough of a nest egg to fund the second and third projects.

"The idea is to bootstrap yourself using lower overhead projects to pay for subsequent, more ambitious projects -- like our next one," he says. "That's a better idea than turning to, say, a venture capitalist whose goal is to have you grow your company and then sell it off. That may be good for them, but is rarely good for your own career goals."

While Smith says it's difficult to measure how much money a startup needs to build its first game, he estimates less than $20,000 "if you add in every little expense like buying new MacBooks so we could work, and paying lawyers to get you a trademark. But that doesn't include spending eight months of your life -- paying your rent and feeding yourself -- doing something that may or may not pay off in the end."

Meanwhile, as Smith's team is working on its second game, the folks at indie Haunted Temple Studios are busy on their first, which is "rapidly approaching alpha."

Founder, director, and art director Jake Kazdal has a background similar to Smith's -- in fact, the two developers worked together at EA Los Angles on the ill-fated LMNO project where Kazdal was a concept artist. There he did some interface design for Boom Blox for Wii, followed by 18 months as senior environment concept artist for Command & Conquer 4: Tiberian Twilight. After moving to Seattle, he joined indie Zombie Studios as art director on Blacklight: Tango Down for XBLA, PC, and PSN, but spent his nights and weekends working on a hobby project -- a simple iPhone game.

Kazdal admits that he really had no interest in opening his own studio, "but I got a lot of pressure from friends to do my own thing. Frankly, I didn't think I was ready. When I thought of a 'studio,' I thought 20 guys, big office downtown, big expenses, and so on. It didn't appeal to me.

"But my 'hobby project' was picking up steam pretty quickly, and my friend and I noticed that maybe it shouldn't be the simple iPhone game it had started as -- maybe, as hardcore console gamers, we could turn it into an Xbox game.

"It wasn't long before we realized we needed to quit our jobs -- which we did in March, 2010 -- and take on the project full-time. And so, my launching Haunted Temple Games, which is really just the name of my team of three, just sort of happened.

"Haunted Temple is really just a tiny microstudio of three guys," he explains. "I mean, the other two are both in LA working from home, and I work here in Seattle. We don't have a centralized space, we don't have health insurance, we don't have anything you'd think of as belonging to a real company."

But Kazdal did have his own strategy for generating funds for his first title, Skulls of the Shogun, the so-called "hobby project" that is now scheduled for release this fall. The turn-based strategy game featuring combat between undead samurai will be published by Microsoft for Xbox Live Arcade.

"We started with some angel funding from my father -- who is an investor -- just to get going and now we're getting more money from Microsoft," says Kazdal, although he says he's not permitted to discuss the details. "It's quite a difference, having been art director and a senior concept artist, making really good money. I was used to getting a paycheck every week from EA, and now I haven't had spare cash for a long time -- which has been stressful for everybody, my wife included. Hopefully that will end sooner than later and we can start moving on with our lives."

Skulls of the Shogun

In addition to his financial concerns, much of the stress comes from wearing as many hats as he does. There is always something to do over and above game development, he says, including interviews, legal matters, and business decisions.

"All of those things takes almost my whole day," he says, "and then, late at night, when all the phone calls taper off, that's when it's quiet and I can sit down and actually do the work on our game."

But, while Kazdal says the stress really takes its toll, he is delighted by the creative freedom he has, and being able to plan the game he wants to build without anyone telling him to make changes.

"It would be really hard for me to consider going back to the way things were," he admits.

However, now that Kazdal is being funded by Microsoft and there is suddenly a publisher on the scene, he recognizes the fact that he will have to "start answering to them a bit more. But, for the most part," he says, "it's been pretty awesome."

Kazdal recalls that getting his first contract -- with Microsoft -- took a lot out of him. Even though he and his team had cred as developers, they were a new unit doing something completely on their own, and so there was a long negotiation process.

"We had put a lot of effort in places like GDC and the other shows, getting meetings with publishers, showing them what we were doing, and talking to the press to make a name for ourselves. We finally had a good E3 where we won two 'best strategy game' awards and we started talking to Microsoft. A lot of good press and good comments by other developers helped convince Microsoft to seal the deal."

His best advice to developers who want to set up their own shop is not to quit their day job until they have a playable prototype up and running, "something you're proud of and can show off to publishers. It helps to get some initial money to start off with to enable you to leave full-time employment to give you the opportunity to go out and find that first publisher with deep pockets."

Beyond Skulls of the Shogun, Kazdal hopes to make enough cash off of that first title to fund the second, and not have to depend on another publisher.

"I'd really rather keep it small and self-funded rather than share the income with a publisher," he admits. "I mean, my goal two or three years down the road is for things to be just the way they are -- and to be rich! That's a much easier thing to achieve if you can do it without a publisher."

Compared to Tiger Style Games and Haunted Temple, Australia-based Uppercut Games is just an infant, having been born less than six months ago. But it has fewer funding concerns than the two U.S.-based indies, mainly because of Australia's government support policies.

Even though its two co-founders consider Uppercut to be self-funded, they've received help from the New South Wales government's Digital Media Fund.

"New South Wales [Australia's most populous state] is trying to encourage digital media and is very specific about being interested in games," explains Uppercut co-founder Ed Orman. "I think one of the reasons they liked us was the pretty decent plan we put together to show them what we intended to do... and also because of our pedigree."

Until January, he had been at Irrational Games/2K Australia for nine years as a lead designer, and co-founder Andrew James had been at the same studio eight years as an art director. Together, they have 28 years of experience in games and have worked on such titles as Fallout: Tactics, BioShock, Tribes, and the upcoming XCOM reboot.

While Orman wasn't able to discuss what funding they received, he made it clear that "we will be spending a lot more of our own personal savings in the long run than what we've been given. The great advantage of having worked the hard deadlines at a big studio like 2K is that we hadn't taken many holidays, and so we both walked away with a fair nest egg to spend, and we've been churning through that. So the government money will definitely come as a great shot to that."

When the pair left 2K in January, their motivation was "having been in one place for a very long time," says Orman. "While the opportunities there were fantastic, we just wanted to try and do something different and to be our own bosses."

Both developers had spent all their time in PC and console games, but their first Uppercut title will be Epoch, an iOS combat action game set in a post-apocalyptic world powered by the Unreal Development Kit. It's scheduled to be released this fourth quarter.

"I had an iPod Touch and A.J. had an iPhone 3GS," recalls Orman. "We just started playing games on them, and found that we really liked not only the simplicity of them, but also the fact that the graphical power was starting to catch up with other devices."

Epoch

Orman says their intention is not to have eaten through their funds before Epoch is shipped. "We did the numbers," he says, "and figure we can survive long enough to knock our first game out of the park. The reason we're going with a big, quality game is that we hope that whatever it makes will be enough to fund our second game. Yes, it's riskier, but we think it's going to pay off in the end."

Meanwhile, there's a second game in the works -- tentatively named Plunder -- which is also receiving government funding. The duo has several programming contractors and contract artists spending time on it so they can turn their attention to it as soon as Epoch is complete.

"Our strategy is to have multiple projects on the go so that we can roll off completing one and immediately roll into the next one," says Orman.

"Something we learned at Irrational was that you can't throw all your eggs in one basket," adds James. "There were always several projects in the works so that, if something fell through or a build didn't happen, there was always a fallback plan. I think that's a good strategy to maintain."

Of the three indies, Tiger Style's Smith has the most experience under his belt as an independent developer, and is perhaps in the best position to offer his advice to others who are considering following suit.

Surprisingly, despite his exuberance, he cautions others to make the move only when they are good and ready. If they aren't at a point where they feel confident, if they don't have a great idea that they believe can succeed, he suggests they stay inside the studios, building their experience, until they feel they are ready to take the risk.

"Being an indie is a very entrepreneurial move," he says. "It's exciting, it affords you a lot more freedom, but it's high risk and it's only the right thing for certain people. I had enough money saved up and I was willing to spend it all. If you're not committed, well, there are plenty of horror stories out there about people who thought they could make it and died trying. You need to be very cautious not to become one of them."