Halfbrick's story up til now...
Not mentioned in the article, but I heard they were dealing with making a Jetpack Joyride Casino version too. I feel like there are so many lessons there in how not to run an indie games studio. <_< Which is a shame, because Fruit Ninja and Jetpack Joyride were pretty cool!
http://www.kotaku.com.au/2016/11/australias-most-successful-game-studio-is-having-an-identity-crisis/
http://www.kotaku.com.au/2016/11/australias-most-successful-game-studio-is-having-an-identity-crisis/
Comments
So Halfbrick revived a few more old games and brought in a lot of new revenue without the expensive process of building entirely new games. The take-away was that if one has a relatively good/large catalogue of games, that because of the way the Appstore works, one can generate revenue from them indefinitely as Apple will keep featuring your games if you keep updating them.
Better hope the App Store never changes then, I guess. :P
What strikes me about Halfbrick's story (and Zinga's, and Rovio's, and many others after initial knockout success) is that they seem to focus too heavily on what's currently successful. Sure, Fruit Ninja, Farmville, Angry Birds, and whatever other successes they've had are bringing them big bucks now, but as @Elyaradine hinted at, that pretty much all hinges on current App Store behavior, and customer behavior. Just as Zinga found out about facebook games, and Harmonix discovered about music games, a platform or player interest change can pull the rug out from under you at any time. At least Rovio had the good sense to capitalize on the characters they created and build a merch empire.
What I don't get about these small-gone-big companies is why they don't learn from their small beginnings and keep a couple of incubator teams around, knocking out small budget titles. If each of those teams has the kind of budget they developed their earlier hits with, it wouldn't dent their bottom line. Worst case scenario, they churn out a couple of mid performers a year that add to the size of their internal free advertising reach. Best case, they get more unusual hits and possibly even stumble on the next big pattern that shapes the market. Ideally these wouldn't even be treated as internal departments with a guaranteed ongoing budget, but a limited time and budget to reach a hit or they get wound down (same pressure that led to the hits now sustaining the parent company).
The way tech is valued is ludicrous. The multiples principle (enterprise value/ earnings or users) results in these massive valuations that result in huge fund injections into unsustainable businesses based on forward revenue. I think at this point, creating a game is secondary to 'growing the company'. Private investors take unprecedented levels of risk hoping for a pay day or an early exit.
What seems the tragedy to me (from Halfbricks point of view) is that Luke Muscat left Half Brick and went on to make pretty darn successful games, which sort of validates @mattbenic's point, in that if Half Brick still had him making new things they'd be adding more hits onto their roster (which they would have been able to milk going forward).
I don't know if you'd agree, but I think there is a company that did pretty much what @mattbenic described (having small teams developing lots of little games at small cost to the overall production and retaining both their talent over long periods). That company is Tencent, and their setup worked rather well for them (as in they are probably the most successful games company in the world at least partially as a result).
So yeah, I think there's a great example out there of learning from one's humble beginnings and profitting big off it (like I think @mattbenic would recommend), with that in mind it does seem a little more foolish that Half Brick followed Zynga's example rather than the one of Tencent. But I think what @bischonator said probably explains this.
(Please correct me if I'm wrong about Tencent's strategy, I'm actually not too familiar with the company apart from a few facts)
I think there are many indie studios that have stayed small and continued their prototyping culture and, having built a brand for themselves, are able to make sales on their new titles quite easily (much more easily than a new developer would). But I struggle to think of studios that have expanded larger and larger (to the point of having multiple titles in development) while maintaining their prototyping/creative culture. The only one I can think of is Double Fine, and I get the impression that they've had mixed success and their own share of financial struggles. Are there perhaps other examples of studios that have been successful this way? (It certainly seems to make sense to work this way.)
Anyway, for a fascinating read, check this out: eurogamer.net/articles/2016-10-27-20-years-on-the-tomb-raider-story-told-by-the-people-who-were-there
It is a textbook case of the rise and fall of a games company (and maybe a slight rise again).
I think it's one of the best articles I've read all year.
[edit] Just read @bischonator's link. That was pretty heart-breaking too. Especially because what Heath-Smith believes was the reason for their downfall is, to me, not the correct reason. He thinks Core died because they didn't ramp up big enough, and that when they ramped up they weren't prepared for it. I feel like that's only a tiny part of the problem, next to crunches that were causing divorces (crunches that were partly his fault for taking deals the team wasn't ready for), his failure to stand up for his creative staff (and therefore losing two of his most important staff), his failure to push back against unreasonable expectations of publishers, and publishers' sales expectations being pushed higher and higher. (I realise I may be being unfair putting a lot of blame in his hands, in the sense that I've never had to take the responsibility of heading my own studio.)