Times are changing for traditional game publishers. As crowdfunding becomes the norm rather than the exception, they’re in danger of becoming irrelevant to a growing army of self-driven developers.
But a change of management at Square Enix, the publisher behind the hugely successful Final Fantasy role-playing series and Tomb Raider action-adventure games, brought a change in thinking. New Square Enix president Yosuke Matsuda expressed a desire to reconnect with the gaming community and build relationships with fledgling development teams — partly as a way to seek out new intellectual properties.
[aditude-amp id="flyingcarpet" targeting='{"env":"staging","page_type":"article","post_id":1567454,"post_type":"story","post_chan":"none","tags":null,"ai":false,"category":"none","all_categories":"games,","session":"C"}']Phil Elliott, the head of community at Square Enix Europe, ran with those ideas and came up with the Square Enix Collective. It’s a platform for developers to get feedback on their game ideas and build awareness before heading into the hazardous waters of crowdfunding initiatives like Kickstarter and Indiegogo.
But with no obligation for the developers to distribute or publish with Square Enix if they get funded, there must surely be a catch. Big publishers don’t let games (or money) slip through their fingers, right? GamesBeat spoke to Elliott to find out more.
The word from the top
Square Enix announced the Collective project last October and launched it fully in April of this year. But two weeks before the initial announcement, the terms for potential developers were still unclear.
Elliott wanted the project to be open, but he was sure that senior management would want to tie developers in to a distribution and publishing deal once they’d signed up.
“The structure was [originally] built on the idea that once you submit to the feedback platform and you go live, then if we offer to help you through funding, then you have to accept,” said Elliott. “If we offer to distribute, you have to accept. I thought they’d never go for it otherwise.”
Matsuda had other ideas, though. In a conference call to Tokyo with Matsuda and “a few higher-ups,” Elliott explained the Collective structure to him.
Matsuda sat and thought before saying “no,” according Elliott, who described the president’s reaction: “[He said] the mantra for this project is the developer chooses. We do not force people to work with us. After feedback, there are no ties; after funding, there are no ties.”
“I thought, ‘this is great,’” said Elliott. “‘I’ll happily go out and tell people this message.’ [Matsuda] understands where the lines are and what we want to achieve.”
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Above: Moon Hunters was a huge success for the Square Enix Collective.
The Collective goals
The Collective has posted pitches on more than 40 projects from around 16 countries now. Two have made it through the process and gone into a crowdfunding phase. One, Moon Hunters, just raised $160,000 on Kickstarter, much to Elliott’s delight.
But how does the process work, and what’s in it for Square Enix?
“There are selfish reasons, and there are broader reasons that make sense for the industry,” said Elliott. “We do want to find new teams to work with. We do want to find new talent and potentially new IP to invest in.”
But there’s no time frame for this, and developers have no obligation to accept any offer of direct investment. In the meantime, Square Enix will help support independent teams through the Collective, hoping to make connections and engage the community along the way.
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Above: Community members vote on whether they’d support each project through crowdfunding.
There’s no charge for developers to sign up to the Collective, which gives them 28 days to build an audience and get feedback from the Square Enix community. “We look at the feedback phase as kind of a practice run for when they do go on to crowdfunding,” said Elliott. “We want to help them learn as much as possible in that time.”
Square Enix then offers its support through crowdfunding to successful projects — after digging down to assess whether the dev team will actually deliver — in exchange for 5 percent of the money they raise. “That’s not because we think we’re going to get rich from 5 percent of small crowdfunding campaigns,” said Elliott. “That’s really just so we can cover the costs of creating the platform.”
Teams that successfully complete funding get an offer from Square Enix to help with distribution, but, again, this is obligation-free.
“If we do distribute, then it’s a very defined process,” said Elliott. “In return for QA support, getting the game on Steam, and then handling all the sales process, we ask for 10 percent of net revenue, which is equivalent to about 6 percent gross. It’s a pretty skinny cut.”
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Funding in a changing market
The industry is changing, and it’s easier to get a game to market now than it’s ever been. Many developers don’t see the need for a publisher at all, and this is a big problem for companies like Square Enix.
“The truth is, developers have a wider range of finding funding now,” said Elliott. “The industry has changed hugely in the past console generation or so. As a publisher, you used to be able to go to Game Connection or the Game Developers Conference and have 20 or 30 meetings and probably have a pretty good idea of what the double-A industry is offering and what you want to sign.
“Now that layer is receding, and instead, you’ve got 10,000 developers making so many different things. It’s a layer that rightly is less interested or requiring of working with publishers.”
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Elliott points to recent breakout games that completely bypassed publishers. “We’re not going to make all the right decisions,” he said. “We wouldn’t have funded Papers, Please or Ridiculous Fishing or Minecraft, and we didn’t. And nobody did.”
“I personally don’t believe that publishers should be funding everything,” he said, explaining how Square Enix and other traditional publishers have an opportunity to see themselves in a different light outside the triple-A market.
“I think there’s an opportunity to say, ‘All right, here’s a list of services. Do you need any of these?’ It’s not [acting as] a publisher in a traditional sense. It’s more of a service provider.”
Kickstarter vs. Indiegogo
At launch, the Collective was billed as a partnership with Indiegogo, partly due to the crowdfunding site’s lack of region restrictions. The first wave of Collective projects didn’t have an option to use Kickstarter once they’d left the feedback stage.
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The first project to find success on the Collective, futuristic action-role-playing game World War Machine, didn’t find things so easy when it actually hit Indiegogo.
Above: Concept art from World War Machine.
World War Machines only raised $12,000 of its $40,000 goal, and Elliott said this was personally tough to take.
“By the end of it, we’d driven about 100,000 people to that campaign through the stuff that we’d done,” he said. “So, I thought we kind of did do what we set out to do. We can’t force people to back the project.”
Elliott had to sit down and think hard about what to do next: “We had to ask, ‘Is it the right platform?’ ‘Is it the right project?’ ‘Is it the pitch?’ I think there were some mismanaged expectations between the concept art and the game.”
Whatever the reason for the failure, changes to the Collective had to be made. And adding an option for Kickstarter was one such change.
As for World War Machine, the project certainly isn’t dead and buried yet. Without going into any details, Elliott told me that “there is other interest around that game.”
Finding success
If World War Machine was a failure, the Collective’s latest project, Moon Hunters, was a resounding success. Meeting its funding goal of $40,000 within 50 hours on Kickstarter, the beautiful 8-bit RPG went on to raise four times what it initially needed.
“It was reassuring to us because [it showed] we do have value to add,” said Elliott.
https://www.youtube.com/watch?v=M7o_Rj87Nuo
Moon Hunters was part of the Collective’s pilot phase back in January, and feedback from the community indicated demand for a PlayStation Vita version of the game. Elliott took that opportunity to introduce Moon Hunters developer Kitfox Games to the third-party publishing team at Sony. That then led to a post on the official PlayStation Blog, driving more traffic to the Kickstarter effort and helping end the campaign on a high.
Elliott said the Moon Hunters team was a great example of an independent developer with real drive, which also helped its campaign. “They’re great,” he said. “They’re real self-starters.”
The Collective future
The plan for the Collective is to now try and take one project forward to crowdfunding every month. The latest title to find Collective success, the dark and atmospheric Black the Fall, is now on Kickstarter. Based on the experience of its lead artist growing up in post-Soviet Romania, it takes inspiration from acclaimed titles like Limbo and Another World.
Above: Black the Fall is currently on Kickstarter.
Elliott is keen to point out that the Collective is not a money-making venture, however, and if Black the Fall does find success, it will only help boost the platform further. “I have no revenue targets for Collective,” said Elliott. “Any money we do make over and above costs will be reinvested back into the platform.”
“There are a lot of things we want to do under the banner of education and pipeline support,” he said. “It’s a long-term project.”
Whatever comes next for the Square Enix Collective, it seems sure to remain tipped in favor of the developer, which is refreshing for an initiative coming from a large publisher. But, as Elliott says, “It has to work for developers because if there’s no content, there’s no platform.”