Hothead Games details its 10-year transition from console to mobile and Kill Shot Bravo

It’s difficult to find success in game development, and once found, it’s rare for a team to sustain it for a decade. But that’s exactly the case for developer Hothead Games, which is celebrating its 10-year anniversary in 2016.

Today, Hothead is best known as the developer responsible for the popular mobile sniper game Kill Shot Bravo, which the studio recently updated and released in China. It is in the top-100 highest-grossing app on iOS and Android in the United States, and the company used its success in the $36.9 billion mobile gaming industry to open new offices in Halifax in late 2015. But to get to this point, the company has had to stumble along the way before figuring out what the hell a “live ops” is and settling lawsuits with competitors.

Hothead started in 2006 with the goal of making smaller downloadable games for consoles. Director of development Vlad Ceraldi and director of technology Joel Deyoung founded the company in Vancouver after working at The Simpsons: Hit & Run studio Radical Entertainment together.

“We saw an opportunity in the market to become a new kind of publisher — direct to consumer, based on new IP,” Ceraldi told GamesBeat. “We thought that opportunity would exist in downloadable PC and console. Facebook wasn’t really a thing yet. There weren’t the social channels yet. That’s when we founded the company to be that publisher of independent original titles.”

The company worked on the Penny Arcade game On the Rain-Slick Precipice of Darkness: Episode One and Deathspank with beloved adventure game director Ron Gilbert. But working as an indie developer in the days of the Xbox 360 and PlayStation 3 was a lot more challenging than it is today.

“It got harder and harder to deliver content to these channels because they were more closed than we anticipated,” said Ceraldi. “In some cases, we couldn’t even get a publisher license on a couple of platforms. They wouldn’t let us directly publish, only as a third party. The approval process for our original ideas wasn’t exactly what we had hoped for. And the market didn’t develop the way we expected. We knew that things would eventually go pure digital and downloadable, but it wasn’t happening fast enough.”

Then, in 2009, mobile gaming started taking off. Everyone at Hothead noticed it was happening, and they were keeping an eye on it while working on their digital console releases. In the following years, Hothead deliberately charged into this new space with the idea of applying its development know how in an all-digital ecosystem, and I caught up with the team to chat with them about that history and how it ended up where it is today.

Check out my interview with Hothead’s executives about their history right here:

GamesBeat: Tell me about the transition from console to mobile. What were you thinking at the time?

Vlad Ceraldi, Hothead director of development: It looked like a gold rush. We were neck-deep in our downloadable titles at the time, but we kept our eyes on it. And then we saw the opportunity to transition in late 2010. We made our plans to burn all our bridges and focus everything on mobile. We knew that was where we could be what we wanted to be — be that publisher and create the original IP we wanted. Be in charge of our own destiny with both business and creativity.

We transitioned fully during the 2011 year. We started with some inexpensive paid games to learn a bit. Ian set the strategy to fail quickly, and we certainly did. Failed a lot actually, and quickly. But we saw the emergence of free-to-play, and we were early movers with free-to-play in mobile. Our first hit series was the Big Win Sports franchise we created.

Arguably, we were a leader in sports on mobile for quite a while. We saw a similar trend in the shooter market, recognizing there was another opportunity there we could take advantage of. We focus all our energy now on that opportunity because we think it’s huge. That’s pretty much what we’ve been doing for the last while, and we’ll continue to do that going forward.

https://www.youtube.com/watch?v=GVxauWN_XSY

GamesBeat: What was it like to “burn all your bridges” and dive into this new thing? Did you have any moments of regret while doing that?

Ceraldi: It was just so clear to us that was where the market was going. Reaching a worldwide audience with platforms that were relatively open, that have decent revenue sharing, and the growth was astronomical. It felt like we could play in a console market that wasn’t predicted to grow that quickly, or we could reach a worldwide audience and hit gamers in a way we never had before with mobile all over the world. It was a huge growing opportunity. It just made so much sense.

Ian Wilkinson, Hothead CEO: We believe in focus. We don’t like to leave back doors. We wanted no retreat, no surrender, no opportunity to rethink our decision. That’s part of my philosophy, to force ourselves to get it right and keep working at it. I think it’s fair to say we never reconsidered and never regretted it. As [Ceraldi] alluded to, our original strategy was to fail quick and fail cheap. We were quite effective at that. Then we got into free-to-play, and we had a big success almost immediately with our first Big Win Soccer game.

Oliver Birch, Hothead director of marketing: And nobody had any mobile experience in 2011.

Ceraldi: That has been a struggle in the past. You weren’t hiring people who had been in mobile for years. It was new. There were some people who’d done mobile for handsets and other things, but it’s a different business model. We were trying to transition as PC and console makers. At Radical, before we transitioned to Hothead, we were making triple-A titles as far as licensed product. Then going to smaller console, which we were doing with our own product, it was a different scale. And then suddenly we were doing these very small, small screen, small executable, smaller experiences.

I likened it to going from — at Radical we were running marathons. Then, at the beginning of our company, we were running 10Ks. Now we’re doing 100 meter sprints in the beginning on mobile. It was tough to transition. Our designers had to become marketers as well as game designers. A variety of different skill sets they’d never exercised. Understanding economies and promotions. A variety of skills across every discipline. Luckily our technology internally was one we were able to move. It’s the same engine that created our console games running on mobile. That allowed us to adapt our technology over to mobile. That was a nice piece from a transition point of view that worked out in our favor. But everything else, every other process we had, had to shift and adjust.

GamesBeat: For Big Win Soccer, that shift to free-to-play on mobile where you guys were learning all these things, you said that was a success out of the gate. But what were the growing pains there?

Wilkinson: We launched the game and we had a significant number of downloads, for us at that point. The servers fell over. They fell over every day. It was really frustrating, because people loved the game, but they couldn’t play it. We just persevered.

I don’t recall how long it took us to stabilize the game. It seemed like forever. I’m sure it was probably weeks, maybe a month. But that was a massive learning experience, how critical people can be. Especially if they like your game and they can’t play it. That was incredible. After that we were able to create four more Big Win games in the next 15 months. In a 15 month period we had five Big Win games up.

In all honesty, we were probably lucky with Big Win. We had a particular market we were going after we thought was untapped, but honestly we didn’t know how to monetize those customers. But we had some success with it.

Ceraldi: The other thing, as far as soccer, even when we shipped it to mobile, we were thinking products, games, like we always had. We had no plans to update them. You can update PC and console like never before now, but they’re still pretty much—they’re not being changed on a daily or weekly basis. There’s not a constant road map of changes going on forever in many cases.

In mobile, understanding that we were running these game services, that they were up 24/7, that they had to have support 24/7, have to operate on every device around the world at all times — it wasn’t just something you packaged up and shipped off and you were done. It was a huge transition in our thinking and the processes we had to develop to support that new thinking, or really the new form of business that we were in. That was a bit of a startling thing for all of us.

Soccer was a watershed moment in understanding that, that we run this service just like any other service, paid for or otherwise. It has to be up. People expect that. It’s going to change and develop. So that was a key moment in our history.

Birch: It’s fair to say we were surprised by the scale of the market, in a way, the potential.

Ceraldi: Yeah. We knew the market scale was there. That was what we were hoping for. But when it actually hit us, it hit us in the face pretty hard.

GamesBeat: You clearly figured it out and released a bunch more Big Win games. Is there anything you look back and laugh at, maybe, something you did then that you would never do now?

Wilkinson: That’s a whole book on its own. [Laughs] The first thing — it was really a land grab. We thought nobody was addressing the sports market with the style of game we were offering.

Ceraldi: We were all sports fans, and we’d made sports games before.

Wilkinson: So rather than update the games, we just cranked out five of them and had five games out in 15 months. Then we moved on to other games. We really never spent any significant time creating updates. We had no cadence, whereas with later games, we were releasing a new client every three to four weeks consistently. We’ve done that with Killshot as well.

We weren’t data-driven at that time. Most of it was intuition. I’d say our marketing was possibly unsophisticated. We’ve just come so far in so many areas. It’s incredible.

Ceraldi: It was definitely more pay-to-win. Our understanding of free-to-play was not sophisticated. Understanding how ads could be used to enhance the experience. UI clarity. We could go on and on. As Ian said, write a book. It’s surprising.

Sometimes I think, what have I learned in the last five years in mobile? And then people start asking questions, and I start telling stories and I can go on and on. Especially if there’s beers involved. It’s fun talking about because there’s so much to look back on and laugh at as far as what we did wrong.

Birch: We’re having our 10 year anniversary this year. We’ve gone back and updated the Big Win games to get them up to snuff, if you like. Those games are maintained for the core that still loves them.

We always laugh about that. It was in beta, and we thought it was going to go great because it’s such a beautiful, colorful game with cool characters and plenty of charm. And that game always seems to come up in the meetings, especially recently. We always laugh about that.

Ceraldi: When I go back and play that game I laugh because — the complexity, the lack of clarity in a variety of ways — we were learning so much. We still learn every day now. But back then we were learning so much so quickly that each version was building on new learning. We were learning as we went so rapidly that it actually shows in the product, and in a bad way.

GamesBeat: Now you guys have this whole roster of games. You are, at this point, keeping up with a nice cadence of updates. What’s it like maintaining this whole list of games?

Ceraldi: Games as a service, running what we call live operations or live ops. We have significant resources dedicated to existing services that are running, updating them, tweaking them, fixing them. Running events, promotions, sales. Responding to feedback. User issues on new devices that come out that the game was never designed for. It’s a lot to learn.

It’s a key differentiator for a company like ours. Not every company is very good at it. There’s lots of room for improvement with us, but it’s definitely a competitive advantage if a company can be excellent at doing live operations. That’s one of the learning things we laugh about. The idea that we didn’t do it before — didn’t understand what it meant — it’s laughable. But there are lots of companies that don’t do it or don’t really know what it entails. It’s been a long journey of learning best practices in that regard.

The personality to run it, the skill sets. The lead designer for a live ops team is far different from the lead designer on a game you’re building to eventually launch. Being data-driven and understanding user behavior and understanding what’s working and what’s not. How to tune it to make a better gameplay experience or how to monetize better. That’s a daily thing. It’s going on all the time.

Monitoring the KPIs, seeing how the game’s health is. It’s pretty daunting to understand. Like I said, when we look back on what we’ve learned it’s one lesson after another after another. We really could write a book about it. If you told me at the start that we’d have to do all this, it would have been pretty daunting.

GamesBeat: Go ahead and tell us about the makeup of your teams today. 

Ceraldi: We used to have little teams, five-six-seven-eight people in some cases, building very small concepts into products that would go live and never be updated.

Now we have teams that can exceed 50 people. We have a lot of fluidity with regard to team makeup and sizes. Live ops teams can be more than 30 people. We have our core game teams. We have our live ops teams. People shift around to different projects all the time, helping with different tasks and taking on different opportunities. Things are more fluid than they’ve ever been in that regard.

We’re seeing a lot of the genre we’ve chosen to become best in the world at, the shooter market. It’s paid lots of dividends, the learning and acceleration of our skill set in that genre. Both on gameplay, controls, technology, visuals, monetization, server, events, multiplayer. That’s been a key difference as well. Back in the day we were making a diverse set of games that had no relation to one another. Now all the teams are going in the same direction.

GamesBeat: What would you credit with giving Hothead its longevity?

Wilkinson: One of our core values is “make mistakes, always learn.” We appreciate that we have to take risks. We have to do things differently to achieve better results. There’s a quote on the website about adapting and mutating and doing whatever’s necessary to move forward as a company. We really embrace that. We think we’re smart and we’re very hard-working. We like to think we learn from our mistakes very quickly and don’t repeat them.

Both with Radical and with this company, I don’t think we’ve ever been at risk of going out of business or any dire consequences that I can recall. That’s partly just through running the business well. We have multiple teams. We have a portfolio approach where we have games with higher expectations, a higher risk profile. Other games have a lower risk profile so we can balance it out. We make sure that we’ll be here next year and the year after that.

Birch: Just to clarify, our core value is “take risks and always be learning.”

[Laughs]

GamesBeat: Taking risks and always learning, I guess that means you’re willing to look at what’s next. It seems like you guys have a formula that’s working right now, but I’m sure you believe that maybe one day that formula won’t work, and that’s why you take risks. Is that the reasoning behind that?

Wilkinson: Yes. If someone’s going to eat our lunch. We want to be the ones eating our own lunch.

Ceraldi: We want to make that next iteration, that next evolution. At the same time we’re making that evolution, we want to invest in something that’s a step beyond that evolution in the genre we focus on.

Ian mentioned that portfolio approach. Each game does have a significantly different risk profile as far as innovation or a variety of different factors. We have a number of exciting new projects in the pipeline, in production, on top of the road map of new ideas we have for existing game services. We’re not afraid to make some pretty big changes to our live products. We’re adding a lot of depth and new experiences for gamers.

Kill Shot: Bravo , for example, we decided that PvP was strategic for us while it was in development. We added PvP to the game before it went worldwide. But it wasn’t part of the original vision for that product. It came out of a lot of analysis of the market, understanding where it was heading, looking to China and other regions that showed us how the market would be shifting in the future. And then taking our designs and modifying our products and delivering on that in a relatively quick time frame.

But no, we’re excited about our road map across live ops and new products. There’s always innovation, always new ideas being brought to bear, but some games are going to be far more innovative and take more risks than others.

GamesBeat: What are the next 10 years going to be like?

Ceraldi: We’ll start with the next three: World domination.

With regard to the genre we want to become best in the world at. We want to become the best shooter publisher on mobile in the world. There’s lots of strong brands in the shooter market on other platforms. We want to be creating that brand on mobile, one that we bring to a worldwide audience that has the same power and resonance as those major brands do on other platforms. That’s our three-year horizon.

Birch: It’s safe to say that’s a company-wide initiative.

Ceraldi: Yeah, company-wide. Our strategy is that everything is supporting that vision.

Wilkinson: I write an email to the employees every week to tell them how we’re doing on our priorities. We have quarterly priorities, annual priorities, and a three-year plan they’re intimately familiar with. Then, once a month, I do an all-hands meeting and we talk through our strategy and execution and where we are with respect to our goals.

Anyone in our company should know exactly what we’re trying to achieve. We have a three-year plan, a forecast. We spent a tremendous amount of time on it. We believe in it. The different teams have contributed to it in terms of their revenue goals. And then we publish it, essentially.

Ceraldi: The other part of your question is the next seven years. We really want to use our dominance in the genre that we’ll achieve in the three-year time frame as a stepping-stone to other genres thereafter. We want to leap ahead into another genre in the future.

But what we’ve learned in mobile is that things change rapidly, far faster than any other product cycle or platform cycle in the history of gaming. There are lots of new things coming down, technology, be it VR or other new things in the gaming space. We don’t have a 10-year plan saying, here’s what we’re doing in mobile. We have a three-year plan saying, here’s how we’re going to dominate this genre and we know we want to grow from there.

GamesBeat: Any final thoughts about the state of Hothead?

Wilkinson: Interestingly enough, I just did orientation — we have 10 or 12 new employees that started in the last few months. I asked them for their observations. Some of them have been here a matter of days, others weeks, others months. I said, what do you like about the company? One thing they said that, in retrospect, doesn’t surprise me, but that I wasn’t fully anticipating — they said we can’t believe the level of transparency. You sort of tell us everything.

We have a revenue report that goes out every day. It shows exactly how much we make on every single game. It shows downloads. It shows DAUs and so on. We’ve done that for six years, I believe. All the information we have, we try to make it available to the employees, just so they can make better choices. We’re quite willing to make mistakes. We make mistakes all the time. And then we try to recover from those and learn from them. But consistently that was some of the feedback I got from new employees – we can’t believe how transparent you are and how willing you are to share information.

Ceraldi: The way they actually expressed this — the word they used is powerful. It’s different from transparency. It’s “trust.” I think it ties in — not necessarily to our core values directly, but it comes out of who we’ve become as a company.