“People will be cynical about our intentions” - Square Enix Collective

What a difference a year makes.

At this point in 2016, Square Enix Collective hadn't even done its first show, let alone published a game.

Now it has released two, has plans to launch seven more, and has just signed arguably its most high-profile title in the form of World War II multiplayer shooter Battalion 1944 from Bulkhead Interactive - which marks the second time the UK developer has teamed up with the firm.

"We are making big steps forward," says Phil Elliott, director of community and indie development at Square Enix - and the man behind Square Enix Collective.

"Battalion 1944 is, for us, a good sign of health in a couple of ways. The most obvious is that we are working once again with the Bulkhead team. We helped them release Turing Test last year on PC. The Turing Test for them was their second game, it was a little more high profile and the quality was great - Steam user reviews were very positive. Of course, when a developer does a great job, they start attracting the attention of other publishers. I know they spoke to other publishers, there was a lot of interest in the game. So it is very reassuring to me that, in the end, they decided to work with us again and put their trust in us once more. There was every chance they could go elsewhere.

"I would always encourage developers to speak to other publishers. Always get three quotes. It is a bit like your double glazing"

He continues: "I would always encourage developers to make sure that they are having multiple conversations. Always get three quotes. It is a bit like your double glazing. I'd always suggest indie developers see what is available and make the best choice for them. So I am humbled that they considered us still the best opportunity for them.

"Another reason this is important is because, in terms of scale, it is a bigger game. The games we have released so far in Goetia and The Turing Test were certainly of a particular size."

Elliott is clearly a fan of Bulkhead's strategy of developing one game with an eye over what comes next. He says Battalion was the title that the team has always been working towards making.

"It doesn't sound sexy, and it isn't exactly inspirational, but I feel the first priority for every new team is to make enough money to make a second game... and not get carried away with what the big indie sensations have managed," he advises. "The chances of being able to replicate a Mike Bithell or a Jonathan Blow - the first generation indie superstars - are very small. Partly because standards have increased, expectations have been increased and the amount of noise has increased - there is so much out there. But if you keep making games, then you will increase your chances. The more you create, the chances of breaking through and growing your business - and therefore your profile and opportunity - is going to go up over time.

"Bulkhead is a good example. Its first game was Pneuma on Xbox, which gained them some experience and did enough for them to make The Turing Test, which they took to Kickstarter successfully. And now they're onto Battalion. Its business mentality is: 'what is the next thing?' 'How is that going to sustain us and enable us to make the thing after that?' I very much respect that approach."

"I feel the first priority for every new team is to make enough money to make a second game.

Square Enix Collective is an unusual initiative. Effectively a start-up within the wider Square Enix organisation, its existence seems to have little commercial value to the Tomb Raider publisher. The team initially promotes people's games via its website, highlighting upcoming indie projects from a variety of developers and showing them off to the Square Enix community. All for free.

Occasionally, Collective will support these games' Kickstarter campaigns - offering PR, marketing and will also do a 'due diligence' job on the studio so that backers can be more confident that the campaign they're backing will reach completion. For successful campaigns, Collective take a 5% cut of the revenue (after fees), but that's it. Developers have no requirement to work with the company afterwards.

Of course, some developers do - as Bulkhead have done twice now - and Collective offers all the publishing services that you've come to expect - including additional investment (although the investment pots are all used up at the moment).

Yet there's no guarantee a developer will want to work with the firm. So it makes you wonder what exactly is in it for Square Enix?

"Square Enix and Collective are not charities," Elliott explains. "We do need to make sure we are being respectful of the opportunity that we have been given. The way the agreements is set up, it's not super hard for us to break even on a project, but it's not easy to make significant profits, either.

"If profit is what we were having to chase, then Collective wouldn't have a particularly strong reason to exist. We want to build relationships, we want to learn and we want to keep our finger of the pulse of what is happening. I think we are doing that.

"Collective has a scale. This year we are looking at games where the budgets might be $1m, but in the future - perhaps by 2020 - we might be working on projects that are closer to $3m - $5m.

"For us it is a bit nebulous to say there is a bottom line number we are working on. We want to make sure we are not costing Square Enix money, and 2017 will be the year where we aim to break even. We have said in the past that any profit we make, we will reinvest back into Collective. We will re-open those investment pots as we recoup them.

"If profit is what we were having to chase, then Collective wouldn't have a particularly strong reason to exist"

"I would love, by the end of this year, for there to be more of an understanding of what we are. For completely fair reasons, people are asking: 'What exactly are they trying to do?' 'Why are they messing around with crowd-funding and indie development with their big size-12, publisher hobnail boots?' 'Why are they crushing things that are good and stealing souls?' Our legitimacy in this area can only be borne out by proof, and that will take time. So by the end of this calendar year, I want to deliver that proof, both to the business that we are sustainable and finding good teams and creating interest. And externally, I would love people to have a much clearer understanding of what the idea behind it all is."

Indeed, for all the benefits of working within an organisation that releases major AAA titles, there is also a certain degree of cynicism of its intentions - for completely understandable reasons.

"As a global publisher, people will be cynical - and should be cynical - about our intentions," Elliott says. "So I've always been cautious over shouting too much about what we're doing and saying we're doing this great thing and that everyone should pay attention. My preference is to prove the concept first. The more you shout about things at the start, the more pressure you put on yourself to get it right first time - and I don't think that's practical. The industry changes so quickly and everyone is learning."

Watch on YouTube

Despite working within a large organisation, the Collective team remains small and needs to be selective with what it does. Indeed, this year it plans to publish seven games and its team size isn't increasing. As a result, the label has put a temporary stop on supporting Kickstarter campaigns.

"We still very much believe in the viability and importance of crowd-funding," Elliott continues.

"We have to think very carefully about what we can actually manage. What we don't want is to compromise income for developers, so when we are working on releases, that is the most important part."

Elliott thought that as time goes on, Collective would become more efficient at backing Kickstarter campaigns. But that's not been the case.

"I don't think we ever thought that process would be straightforward," he says. "We never expected to be able to rinse and repeat, where we can spend ten minutes on each campaign and raise $250,000, because we're so efficient. We always knew that we'd have to work hard because every game and team is different. But we have actually had to pedal harder than ever.

"With each campaign we put more in. So we plough in all the learnings from the previous campaigns, we are getting increasingly detailed on the feedback to the campaign and what the stretch goals are and so on, and we are constantly improving the design of the emails to try and optimise open rates so that we can get as much traffic to the campaign as possible. As a result, instead of it becoming something more manageable from one year to the next, and something we can do whilst doing other things, it has just become more intense and exhausting. It is still nowhere near as exhausting for us as it is for the developers, but when we look at being super-busy this year, and the amount of effort we are putting into those Kickstarter campaigns, we just have to be realistic.

"It is a short-term thing. We are thinking maybe three months or six months, but for now I want to be super transparent to people submitting pitches to the Collective website.

"It is important to point out, that out of the 40 or 50 pitches that we publish on the Collective website each year, I don't think we have been able to support more than six or seven Kickstarter campaigns in a year anyway. So it's not like that was ever a guarantee. But it is something that we became known for and I'm sure we'll pick it up again in the future."

Square Enix Collective is one of a seemingly endless list of publishers that have emerged to support indie studios. Team17, Devolver, Raw Fury, Rising Star Games, Curve, Green Man Gaming, Starbreeze, KISS... and then there's other big companies with indie divisions, like EA, Sega, Activision, Humble Bundle, 2K and GameStop.

"Curation is a challenge for the whole industry," Elliot says. "It is not down to one platform or store or hardware manufacturer or publisher to fix. It is a group responsibility and it is hard. Everyone has their own priorities and their own views on things. I don't think there is any one correct answer.

"But there are options out there for new talent. As an industry, we have to absolutely get that right. We are a creative medium and we rely on new ideas and different emotional experiences. For a long time we have been excellent at adrenaline-based games - shooters, sports games, horror games. As we go forwards we have to - and I think we will - get better at finding different opportunities to promote different emotions. People have been talking about this for decades.. But with the indie 'genre', people are able to go out and make games designed to elicit a specific emotional response.

"It is important that we don't seem too competitive with other indie publishers. We are not trying to muscle in on Team17s business or Devolver or Raw Fury. The truth is that there is plenty to go around"

"It is great to see companies that have had success with their own stuff to try and find ways to strengthen the wider ecosystem by offering support and assistance. That is a little bit that we were trying to do. But there are so many options.

"It is important that we don't seem too competitive with other indie publishers. We are not trying to muscle in on Team17s business or Devolver or Raw Fury. The truth is that there is plenty to go around, and we just wanted to provide more options. We want to be responsible to the industry, we feel it is our back garden and we want to help tend to it.

"We also have this high tide raises all boat mentality.

"I am not pretending that Square Enix Collective is a purely benevolent, non-self-serving entity. We believe in a strong industry, and for an industry to be strong, it needs to continue to be creative. If we can help launch teams and build sustainable businesses, so developers can lean everything from their first releases and put it into their second release and feel empowered so that they feel creatively independent, then that is good for the whole industry and therefore for us."

Square Enix Collective may, at times, seem to good to be true. But it's not a selfless exercise. Elliott and his team wants to find new talent and new genres. He wants to discover the next Minecraft. He says the aim is for the division to publish around ten games a year across different platforms and genres.

As a result, the success of Collective isn't in how it contributes to Square Enix's bottom line, but in what it can teach the wider business. And going forward, the number that's most important to Elliott is not the P&L, but the money it generates for developers.

"When we are budgeting for a financial year, the number I am excited to see the most is how much we are looking to pay out in royalties," he concludes. "That is the important number. How far we can push that up is ultimately how we will judge the success of Collective."

Are you an indie looking for a publisher? Or a company looking to discover the next generation of indie talent? We are matching indies with the industry at EGX Rezzed on March 30th. For more information, contact us here.