Serious Business

No, no. I personally don't favour the Farmville type gameplay, because I regard them as essentially akin to gambling and probably a social evil in my view. So anyone who wanted us to be like Farmville was probably going to be resisted quite strongly. But no, not really - no-one tried to tell us how to make the game. What they looked for was did we have the experience to know what we were doing? We'd made a previous game in this genre, I've personally delivered many games, so they wanted to be able to trust us to do that work. If they felt they had had to say something about that, that would have been a negative for investment because they don't want to have to get involved. That's the expertise that we're supposed to bring, to try and make the game this way or that way. That's been a really good thing about this kind of investment.

the UK is basically a terrible place to do games development work in terms of any advantages from tax

Altogether, we raised about £1 million, but we didn't spend all of that on the game. First of all it costs quite a bit to raise money. I would guess that we spent at least £100,000 or £200,000 just on raising the money and administrating that. This is a really important thing if anyone else is thinking of raising money this way. It takes a lot of work and time and money to do the administration. We spent quite a lot of legal and setting up our licenses and distributor. We spent something - not enough, probably! - on promotion. All told, we probably spent £500,000 or £600,000 on developing the game itself, probably about £400,000 on other things.

The thing about equity investment which is really good for game development models is that you don't have to pay it back directly. If someone has shares in the company, you don't have any debt, essentially. You don't have to pay shareholders anything - it's not like a loan. In fact we do have one loan from a Regional Development Agency, Finance South East, and actually for doing risky development like game production it's much better to sell equity than taking loans. Loans are cheaper - the money is cheaper in terms of what it actually costs the company - but the thing with the loan is you have a payment schedule and you have to make that, otherwise you can go bankrupt. Whereas with equity, you don't have to pay that money back. If anyone's thinking of trying to raise money for games, equity is a really good way of doing that if you can.

In terms of paying off our investment, the return that is contemplated is in a three-to-five year timeframe, essentially aiming to build value in the company and then sell the company. That would be when shares ultimately become worth something. The immediate revenue that we make from the game most significantly goes into whether we can continue our business plan and expand the studio, put other projects underway and build on what we've done.

We're not there yet, but that's what we're working on at the moment, and for the next six months. Trying to promote the game as much as we can, get it onto other platforms, get additional download content for it and see if we can generate enough money to go forward with another project and produce a follow-up. We're not there yet, that's the work that lies ahead of us over the summer.

We were affected. We actually had an application initially to have an RDA take some equity in Red Redemption, and that suffered in all the reshuffling and so on. Then more recently received an actual loan and that process was okay, so for that we weren't affected by what the government's doing. I think if anyone's thinking about getting money from RDAs, you really can't rely on getting anything at all. If you do, it's probably going to take quite a lot of work and in time - in our case maybe over a year and a half, ultimately.

The other thing that we get money from is the R&D relief on tax, which is being improved at the moment, to 200 per cent. That's quite an important component - that's usually enough money to run the studio for a few months. It's very important to do, and to be very assiduous about, and that will be more so in future.

Well, you know, the UK is basically a terrible place to do games development work in terms of any advantages from tax and so on, but our experience has been that HMRC has been basically very cool to deal with on the R&D at least.

We're speaking with another company about bringing it onto iPad and Android, which I think would really suit this type of game because of the card-based interaction. You can imagine easily, just been able to flip the cards and go to other hands, and rotate the globe to places you want to go to... I think it could be a really pleasant thing on that platform. We're porting it to Mac at the moment ourselves, and we hope we to see it go to a couple of other languages as well. We need to get to other platforms, we don't want to restrict it to PC. Just PC only is probably quite difficult to do enough units from. We also maybe need to get to other markets, like the Asian market.

Yeah, at least some PC games can succeed very well. In retail at the moment, it's quite hard to sell PC projects because PC has moved so much onto digital. Digital is perhaps not too difficult to do modest numbers but quite tough to do the same as you would do on consoles. The thing with the PC market is it's so divided, so split up, in so many different fragments. The good thing about it for a developer like us is we get 70 per cent of the price through digital downloads, as compared to perhaps 20 or 30 per cent of the retail if you're going through boxed copies.