38 Studios is Working on a Game, Apparently, Afterall (Kingdoms of Amular)

[HaemishM]

I don't whine much about the company flaming out. I bitch that they did so in a deliberate manner to completely fuck the employees over when it wasn't at all advantageous (telling them after the fact would only make sense if they had some way out of the crunch. "Yeah, we missed an insurance payment but made it two days later with angel funds" not "we stopped paying this three months ago and oh by the way you didn't get paid yesterday and oh by the way we're like $20M in debt and have no possible way to get an income stream at this point to fix the issue"

The failure of the company is mildly interesting. The failure of the entire management team to do anything but stand around in shocked silence while the entire place was on fire however, it worth pointing out and prosecuting as possible.

This. I've worked in failing startups run by jackasses who could only succeed by duping people. For 6 straight months, every paycheck we got bounced the day we got it. After 2 or 3 times of this, all the employees figured out we could go to the bank the check was written on and try to cash the check to see if we would get paid or not. Most times, it took 2 or 3 days of that shit to actually get paid. This is in addition to the boss bouncing checks all over town, threatening to sue anyone that didn't do what he wanted (usually with one of those suspect checks). I've worked in those places, I know what it's like to know your check may or may not be good. But the first time it happened without any warning? You bet I was fucking super pissed, even though I knew we weren't that busy. It's up to the owner/CEO/management to let people know if shit's about to get bad.

The company I work for now let's us know. Yes, sometimes there have been sudden layoffs, but the people who get laid off get severance. They don't have their shit just cut off without any notice or ability to make rent. That's what a GOOD company does. This was not a good company.

As for dark elf porn, if I wanted to write that shit, I would. I don't. I don't blame Salvatore for his success, I blame him for writing shit fiction for low-brow dolts. He can sleep at night with that, good on him.

[Ironwood]

Dude has a sword called Twinkle.

[kildorn]

The failure of the company is mildly interesting. The failure of the entire management team to do anything but stand around in shocked silence while the entire place was on fire however, it worth pointing out and prosecuting as possible.

But there is no evidence that this is what happened. All we know is that management scrambled for a bailout from the government of Rhode Island.  That isn't a "failure...to do anything".   What we do know is management did not reveal the dire financial situation to its employees.   That is normal, sadly.

And I don't know what law you are citing to say it is unlawful to continue operating when your cash runs out.  This country has clearly delineated rules and laws for governing business failures, but it is the job of those financing the company to watch where the money goes.  It should surprise no one that a political loan had lax supervision.

RI State law says they must pay employees within nine days of the end of a pay period, and must notify employees 3 days before if there will be any change in the payment date or amount. That's not counting any further laws for complete non payment. It IS in fact against the law to not pay people. Companies get away with this by promising that it's totally just a fluke and just show up tomorrow and we'll have the money we swear.

We know from the bankruptcy filings that this had been an issue for at least three months (they'd been failing to pay for health insurance as well without informing employees), which means that they didn't scramble to get a bailout from RI in reaction to running out of money: they scrambled as a reaction to the situation becoming Public. The only way they could have gotten money to pay their bills would have been six months prior to all this coming down due to lead time and having already failed to pay their bills.

It's not unlawful to continue to operate without cash. it's unlawful to continue to have employees working without paying them. Companies who are flat broke and cannot pay employees continue to run in theory (38 studios was "alive" for a week or so after laying everyone off), but telling your employees to continue working without pay is illegal.

edit: and you're going to have to explain to me how the entire management staff was too busy trying to save the company or something to say "hey, guys. You need to know that you no longer have health insurance, you know that thing that causes a depressing number of personal bankruptcies every year because it's a huge fucking expense"

Management didn't tell the employees either out of malice, or out of paralysis. Either one is bad, but there is no GOOD reason to not inform your employees that their health coverage was dropped by the vendor for failure to pay. I'm going with paralysis, because I'm not willing to actually believe the management held outright malice for their employees. But it's nice to tell people you are running low on money and hard times are ahead. It's absolutely required that you tell them that you're completely out of money and there are immediate and life changing aspects to that fact.

[Merusk]

To add further rage fuel.. following silicon valley logic this failure makes the executives more valuable, no less.   NPR just did a piece on the culture of failure in SV and how it's regarded.  I'll just say that there's some strange ideas out there.

[Fabricated]

It's honestly a bit depressing how motivated sociopaths with bad ideas can get venture capital thrown at them for the dumbest shit.

[Sky]

Movies are on a whole different plane of crazy. When you look at a movie like Desperado getting made for $7 million and people going apeshit because of how cheap it was, then you throw out Waterworld getting made for over $200 million and you start to realize that those numbers are going to be super-inflated. Book authors though? They don't get that kind of money except for movies, because the movie industry is FUCKING CRAZY. Literally crazy.

I wonder what kind of impact this 3D nonsense is going to have in the mid-term. I was going to take my girl out for a movie on her birthday and the 12-theater movie house was playing 5 movies, because of all the 3D duplication. We didn't go because mainstream summer movies are garbage. But in THREEE DEEEE!

[HaemishM]

I'm hoping 3D dies a miserable, screaming crib death.

[UnsGub]

... culture of failure...

Learn more from failure then success.

[schild]

Sorry but the ability to learn from failure does not exist in the 40-70 age bracket.

[Merusk]

Additionally, a string of failures doesn't mean a success is right around the corner now that they've learned a lot. It means they suck.

A doctor who kills 4 patients in a row in the same manner shouldn't get a 5th.   SV disagrees.

[Ironwood]

Sorry but the ability to learn from failure does not exist in the 40-70 age bracket.

Wow.  That's going in my 'Things Douchebags Say'.

[schild]

Sorry but the ability to learn from failure does not exist in the 40-70 age bracket.

Wow.  That's going in my 'Things Douchebags Say'.

Oh, I'm sorry. I should have been specific on a gaming site where I've bitched and moaned about industry management to great success for a decade that I wasn't talking about the fine woodworkers of Scotland but rather the people that are making the gaming industry eat itself alive - an unfortunate definition that also extends to the folks that have left the world in near economic ruin.

[Sky]

[kildorn]

I think learning from failure is a useful skill. What I find offensive is the idea that C levels become more valuable with failure, but the guy who fucked up your customer facing web presence needs to be fired. Basically: if failure is a learning experience, it's a learning experience for everyone. The bitter directed at management types is the opinion that failure is everyone else's fault, and it's completely impossible to actually FAIL as an executive to the point of really rethinking careers. I'm willing to forgive plenty of minor failures like "I thought the market might react differently" from C levels. I'm not willing to forgive "I thought we might be able to pay people with hopes and dreams for half a year", or "we sold something we don't actually have or have direct control over obtaining, this couldn't possibly turn into a problem!"

[Paelos]

Learning from failure is overrated in business. Often, the reason for failure can be attributed to people ignoring the warning signs, in which case I would question whether or not they would do the exact same thing again.

Business is not a science. It's not a trial and error method. There are things you can do that will be beneficial to long-term success, and then there are things you can do that are throwing good money after bad. It also helps not to suck ass at communications, writing, and dealing with people. Oh, and I'd question where the money went in any failure, and who was in charge of it. If you had your fingers on the finances and it went tits up? You shouldn't have that opportunity again.

[UnSub]

It's important to learn from failure, but the real question is about the lessons learned. 38 Studios lesson thus far appears to be, "We'd have succeeded if it wasn't for that meddling government!".

[Numtini]

I don't know what lessons you could possibly have learned. You're an executive in the company. It's December. You see that at your current rate, you will burn through all your money sometime in Q2. You know your game will not be available until 12+ months later. If you don't know that at that point you need to refocus and do massive cost cutting, I don't know what could possibly teach you that lesson.

[shiznitz]

Hope and Loose Change?

[UnsGub]

Learning from success has it issues also Achieving Failure.  Great site in general, and many of its solutions are missing from the (software) game industry.

[Paelos]

Learning from success has it issues also Achieving Failure.  Great site in general, and many of its solutions are missing from the (software) game industry.

The most important thing he highlighted there was that they built for the customer they wanted, not what the customer actually wanted. That's where many of the video game failures have happened recently.

[UnSub]

I don't know what lessons you could possibly have learned. You're an executive in the company. It's December. You see that at your current rate, you will burn through all your money sometime in Q2. You know your game will not be available until 12+ months later. If you don't know that at that point you need to refocus and do massive cost cutting, I don't know what could possibly teach you that lesson.

A key question is why 38 Studios management acted as they did at that point.

I have a hypothesis the reason that sportsmen can make terrible business people isn't necessarily lack of experience, but that the champion athlete mindet of "keep going through the pain, try harder than the others, maintain focus, etc" isn't a great one to have in business. A lot of successful business people have that mindset, but only to a point, then they cut what isn't working and move on. And fire a lot of people who may actually be good performers but aren't needed anymore.

A top level athlete doesn't go, "We've lost this - let's go home and wait for the next game. And we're firing the waterboy". They double down.

So I wonder if Curt's mindset influenced others when they should have been making cutbacks.

I've got no evidence of that influence, but the CEO (maternity leave, my ass), CFO and COO have a lot of explaning to do.

[satael]

Schilling, who founded the company six years ago, said he personally invested more than $50 million in the company

http://www.boston.com/businessupdates/2012/06/22/curt-schilling-tells-weei-radio-show-that-invested-more-than-his-video-game-firm/v7VtA4ZDu2zdyH2OhS7eaK/story.html?p1=News_links

There are also some other comments in that article which make it seem that 38 Studios really did fail rather spectacularly and so did Schilling.

[Numtini]

So they didn't blow through 75 million dollars and not even have a playable beta. They actually blew through 135m dollars and did not even have a playable beta?

Where does that put them in the list of most expensive video games ever made--or in this case not made?

Schilling added, “I don’t have any problem with government helping entrepreneurs and businesses.”

Of course you don't, bless your little tiny privileged brain.

[shiznitz]

Schilling, who founded the company six years ago, said he personally invested more than $50 million in the company

http://www.boston.com/businessupdates/2012/06/22/curt-schilling-tells-weei-radio-show-that-invested-more-than-his-video-game-firm/v7VtA4ZDu2zdyH2OhS7eaK/story.html?p1=News_links

There are also some other comments in that article which make it seem that 38 Studios really did fail rather spectacularly and so did Schilling.

Ouch. "All gone..."  Well, it is official.  He is a dumbass.

[Paelos]

I think at this point, the only way to make a successful game is to hire people who've never worked in the industry before, and keep a tight reign on the checkbook.

[kildorn]

From talking to industry friends I think the entire industry just needs to grow the fuck up and understand that you need to both work on something creative that you love, AND run a business. There is so much wasted time from people throwing out functional work because they keep changing direction. Crunch Time always seems to be a massive failure of planning that the industry just accepted as normal instead of addressing the root causes.

38 though, god damn. That is a dick load of money to piss away on absolutely nothing.

[Rokal]

This most likely would have ended up costing more than SWTOR by the end. 

[HaemishM]

What pisses me off about the whole "Chaffee ruined our business by queering the $35 million we were trying to get from EA to make a sequel to Reckoning" is that the $35 million wouldn't have fucking helped the situation. It would have paid for the single-player game to be made, but that still would have left the yawning maw of the money pit that was the MMOG draining all the resources of the company. And the deal couldn't have been good enough to allow the single player game's success to feed that MMOG pit - after all, the first one wasn't. I guess it would have meant that he'd have used that money to produce the single-player game AND feed the MMOG pit, but it still wouldn't have gotten them close enough to release for the MMOG to save them.

Blame EA for pulling out of the deal (though you shouldn't - because it's obvious you'd have taken the $35 million and fed the beast instead of producing a top-notch sequel). Don't blame a governor beholden to the voters for not being your goddamn sugar daddy.

[Rokal]

What pisses me off about the whole "Chaffee ruined our business by queering the $35 million we were trying to get from EA to make a sequel to Reckoning" is that the $35 million wouldn't have fucking helped the situation. It would have paid for the single-player game to be made, but that still would have left the yawning maw of the money pit that was the MMOG draining all the resources of the company.

The money would have gone to the MMO/immediate out-standing debts and a dog and pony show would have been made for the single player game. Wouldn't be the first time a developer took money from a publisher for X game and spent it on Y instead.

[Severian]

http://www.boston.com/businessupdates/2012/06/22/curt-schilling-tells-weei-radio-show-that-invested-more-than-his-video-game-firm/v7VtA4ZDu2zdyH2OhS7eaK/story.html?p1=News_links

“The employees got blindsided,” Schilling said. “They have every right to be upset. I always told everybody if something were going to happen, you‘re going to have a month or two of lead time, and I bombed on that one in epic fashion.”

I would suggest that, given the team culture he created at 38 Studios, and the kind of leader he thought he was going to be, an appropriate substitute for "bombed on that one" would be "betrayed them".

Of course he's also fairly well fucked, there are no winners in this debacle.

[tazelbain]

Besides those of us who feast on the tears of stupid people who fuck themselves over.

[Numtini]

Of course he's also fairly well fucked, there are no winners in this debacle.

People with that amount of money go to the 1% poorhouse. He'll be reduced to a million dollar house in a gated community and driving a  a BMW or Lexus.

[Paelos]

And his kids will have to go to public school in a nice neighborhood!

The horror!

[taolurker]

Schilling, who founded the company six years ago, said he personally invested more than $50 million in the company

http://www.boston.com/businessupdates/2012/06/22/curt-schilling-tells-weei-radio-show-that-invested-more-than-his-video-game-firm/v7VtA4ZDu2zdyH2OhS7eaK/story.html?p1=News_links

There are also some other comments in that article which make it seem that 38 Studios really did fail rather spectacularly and so did Schilling.

Full audio of interview

[Soln]

Chaffee stole Schilling's Cloudsong