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Burn rates in gaming, some hard figures

KyleranKyleran Member LegendaryPosts: 37,241
As most indie MMORPGS development efforts grind endlessly onward burn/burnup rates are sometimes brought up but usually are speculative since studios rarely share enough factual info to properly estimate.

However, last year CSE applied for a government PPP loan which bought some financial info to public record.

While one studio's financials are not necessarily representative of every studio, their numbers confirm figures that some people put forth in terms of average salary / and payroll expenses for a US based studio.

Of course, office and infrastructure costs would have to be added to determine what the full burn rate is and I'm not sure if payroll loans cover benefits or not.

Another interesting point is how many employees the studio has, especially considering they've reportedly split the team with some members dedicated to the "betrayal" game, Final Stand, Ragnarok.

Of course, no clue what the current staffing levels are as Mark usually shares info about new hires but doesn't feel it necessary to share the same for the departures.

"City State Entertainment, LLC received a Paycheck Protection Loan of $639,841 through SPRING BANK, which was approved in April, 2020.

Based on standard PPP eligibility rules, City State Entertainment, LLC's total 2019 payroll expenses were approximately $3.07M in order to qualify for the PPP loan amount received. 

Based on their reported 38 jobs retained, this equals an estimated average yearly compensation of $80,822 per employee. 

https://www.federalpay.org/paycheck-protection-program/city-state-entertainment-llc-fairfax-va







"See normal people, I'm not one of them" | G-Easy & Big Sean

"I need to finish" - Christian Wolff: The Accountant

Just trying to live long enough to play a new, released MMORPG, playing FO76 at the moment.

Fools find no pleasure in understanding, but delight in airing their own opinions. Pvbs 18:2, NIV

Don't just play games, inhabit virtual worlds™

"This is the most intelligent, well qualified and articulate response to a post I have ever seen on these forums. It's a shame most people here won't have the attention span to read past the second line." - Anon






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Comments

  • UngoodUngood Member LegendaryPosts: 5,211
    80k Is pretty modest for a Developer.
    KyleranAlBQuirkytzervo
    Egotism is the anesthetic that dullens the pain of stupidity, this is why when I try to beat my head against the stupidity of other people, I only hurt myself.
  • KyleranKyleran Member LegendaryPosts: 37,241
    Ungood said:
    80k Is pretty modest for a Developer.
    Yeah, but some may not be devs, or perhaps working part time or for equity shares in lieu of a more robust salary.
    UngoodAlBQuirkytzervo

    "See normal people, I'm not one of them" | G-Easy & Big Sean

    "I need to finish" - Christian Wolff: The Accountant

    Just trying to live long enough to play a new, released MMORPG, playing FO76 at the moment.

    Fools find no pleasure in understanding, but delight in airing their own opinions. Pvbs 18:2, NIV

    Don't just play games, inhabit virtual worlds™

    "This is the most intelligent, well qualified and articulate response to a post I have ever seen on these forums. It's a shame most people here won't have the attention span to read past the second line." - Anon






  • cameltosiscameltosis Member EpicPosts: 2,838
    Kyleran said:
    Ungood said:
    80k Is pretty modest for a Developer.
    Yeah, but some may not be devs, or perhaps working part time or for equity shares in lieu of a more robust salary.

    Can't really comment on the US market, but here in England $80k (£57k at current exchange rates) is considered a pretty decent salary in general.

    Average salary in the UK is something like £23k, for developers its more like £37k across all industries.

    Devs working in financial tech tend to attract much higher salaries, balanced out by those working for small web firms earning lower.



    So, £57k / $80k sounds pretty damn good to me!

    Given that it's balanced across all employees, i imagine they'll be some admin people earning lower, plus some artists earning lower, then you'll have your senior engine devs earning higher.

    I also imagine (given marks history on the project) that he isn't claiming anything for himself.



    Good to see some solid figures though, thanks for the post Kyleran
    UngoodAlBQuirkytzervo
  • QuizzicalQuizzical Member LegendaryPosts: 22,805
    The price tag per employee depends tremendously on what those employees are doing.  If you want to hire a highly competent computer programmer who is willing to put in crazy hours, good luck finding that for $80k.  There is plenty of market for that skill set outside of the game industry, and they'll pay a whole lot more than $80k per year.  Jobs that nearly any random person could do just fine with a bit of training tend to pay a lot less.

    The price also depends tremendously on what you count.  Is it only the money that goes into the employee's paycheck, or more likely the amount that gets reported as his gross salary to include tax withholding?  How about the taxes that the employer must pay in order to hire employees, most notably for Social Security?  How about benefits, such as health insurance?  The equipment that the employee needs in order to do his job?  A pro-rated portion of overhead, such as the cost of the building where he works?
    AlBQuirkytzervo
  • KyleranKyleran Member LegendaryPosts: 37,241
    edited February 22
    Here's some additional data, this time from Intrepid Studios PPP loan which was much larger than CSE'S.

    Of course, as has happened previously when discussing financing with Ashes creation, there seems to be a bit of shenanigans in the reporting.

    Looks as if Steven filed for loans in excess of the actual number of employees he had back in April 2020, so apparently there was some attrition in the 1st Qtr.

    Based on these numbers it would appear the average employee was paid more, closer to $100k unless significant attrition occurred between the end of 2019 and the time of the application which was probably in March.

    One does have to ask, if Steven really has full funding for his game as previously claimed why did he need a million plus loan, especially since most Tech firms seamlessly transitioned to working remotely with little, if any losses in productivity.

    In the company I work for, much to senior Management's chagrin, technology actually increased productivity significantly in 2020 despite WFH from mid March onwards.

    "Intrepid Studios, Inc received a Paycheck Protection Loan of $1.13M through COMMERCEWEST BANK, which was approved in April, 2020.

    The size of company's PPP loan indicates that the number of employees on payroll during the eligibility calculation period (typically 2019) was higher than the 52 jobs reported as retained on the PPP application3. This could be caused by a reduction in employment since 2019, due to Coronavirus or other factors.

    2019 Payroll Estimations based On PPP Amount:

    Assuming all employees were paid over the $100k eligibility cap, the minimum number of employees this company must have had in 2019 to qualify for the loan range received is 54.

    Based on standard PPP eligibility rules, Intrepid Studios, Inc's total 2019 payroll expenses were approximately $5.43M (not accounting for salary amounts > $100k) in order to qualify for the PPP loan amount received.

    Because the 52 jobs reported are not enough to account for the loan range received, per-employee payrolls cannot be estimated."

    https://www.federalpay.org/paycheck-protection-program/intrepid-studios-inc-san-diego-ca
    BruceYeeAlBQuirkytzervoGdemami

    "See normal people, I'm not one of them" | G-Easy & Big Sean

    "I need to finish" - Christian Wolff: The Accountant

    Just trying to live long enough to play a new, released MMORPG, playing FO76 at the moment.

    Fools find no pleasure in understanding, but delight in airing their own opinions. Pvbs 18:2, NIV

    Don't just play games, inhabit virtual worlds™

    "This is the most intelligent, well qualified and articulate response to a post I have ever seen on these forums. It's a shame most people here won't have the attention span to read past the second line." - Anon






  • WizardryWizardry Member LegendaryPosts: 18,606
    If i tried to figure out exactly what was going on with the books i would need a 5 hour nap and 3 tylenol.

    Just like taking free money from gamers ,it si th esame with the bank,it's an LLC,Mark and Steven take no risk,they lose nothing personally aside from their time spent but they were of course paid well for that time spent.
    There is way too much to boggle my mind like the owners being taxed on the LLC's net profits but they can draw money out of the LLC just not the entire amount,but then how much and how does the TAX change accordingly.

    If they manage to somehow show a small net profit then the tax will be very small.Quite possibly better to have several management/owners rather than 1 to split it up several times amounting to again very little net profit.

    How is the DRAW regulated,what is the difference in tax rates,far too many numbers to crunch and realize for me to bother figuring out.

    I am quite certain of one thing,they all have good lawyers and accountants to make sure they pay little to no tax through the LLC and somehow defer money to again make sure little tax paid.

    BruceYeeAlBQuirky

    Never forget 3 mile Island and never trust a government official or company spokesman.

  • BruceYeeBruceYee Member EpicPosts: 2,129
    Many people see Ragnarok as a betrayal but I see it as a test of the studio's capability/potential. If they can't make a one zone tower defense looter work then how can they make CU work?

    Yes it sux that CU still isn't out but being able to actually play a game made by this studio I'm sure would bring some hope to people.
    AlBQuirkytzervo
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