Business folks: what is “success”

[Pyske]

We have heard many times that all things are possible “in success”. But how is that measured?

Peak users at release? Total sales? Users after 60 days? Hours played? Avg hours per user?

What (magnitude of) numbers would we have to hit to be considered “wildly successful “? What numbers would be a red flag?

Do these numbers change with a Kickstarted project? Did the success level of the kickstart raise the bar or lower it?

I realize that only HBS will have exact numbers and they may not want to release them. But I figure some speculation should be possible.

 

[Juodas Varnas]

Whatever gets me quadmechs.
That's success

 

[dulahan]

Probably sales, and if it's enough to make money for HBS to start with. Success being "making enough extra money that putting some of money towards 'more battletech' looks like a sound investment."

 

[Fox the Apprentice]

Whatever gets me quadmechs.
That's success

Right, better help me gear up for a hostile takeover of HBS.

**powers up Snow Fox**

 

[Leith Maclaine]

Full Disclosure - I was a GenCon Firestarter backer. I have an MBA. I am one of those business people working in technology. I have no affiliation with Hare Brained Schemes other than the kickstarter.

The success of the kickstarter definitely raised the bar.

We had 40K kickstarters which should have covered a good chuck of the development.

So do we get 10 new copies for each backer? 20? 40?

I personally am looking at steamspy data and comparing to other games to see what is in the realm of possible.

Let's look at other names for comparison.

10 new copies per kickstarter backer. I would consider this a success but I wouldn't get that excited.

Stronghold 2, 372,000 owners
Ticket to Ride 385,000 Owners
AI War: Fleet Command 422,382

20 New copies per kickstarter packer - We will be getting DLC's a good basis to grow on

Total War: Warhammer II 762,553
ShadowRun: Dragonfall 827,783 (yes, they have had lots of sales, but they have built a nice indie game studio off of Shadowrun)


30 New Copies per Kickstarter Backer - Very good showing

Hearts of Iron IV 1,012,424 owners
Tropico 5, 1,185,205 owners
Divinty: Original Sin 2 1,239,384
Tropico 3 1,320,787

40 new copies per kickstarter backer

X-COM2, an absolute success by anyone's definition. 1.8 million steam owners
Stellarius, also an absolute success by anyone's definition 1.6 million steam owners.

To dream the impossible dream.

120 new copies per kickstarter backer
Witcher III at 4.8 million

Red Flag warnings - First weekend in being under 100K would be bad in my opinion. Hare Brained may have other metrics.

 

[Deaghaidh]

Ultimately for any product success comes down to making more profit than sinking the same amount of resources into a hypothetical other product.

So success for Battletech is $ .01 more than whatever HBS's next best idea for a new game might have made. Theoretically simple, very very fuzzy when you get down to trying to set a target number.

There have been companies who launch a new product and double their profits, but are faced with disaster because the stock market anticipated quadrupling.

 

[Stefan Amaris Jr]

100 new copies per kickstarter backer. I would consider this a success but I wouldn't get that excited.

Stronghold 2, 372,000 owners
Ticket to Ride 385,000 Owners
AI War: Fleet Command 422,382

^Nice analysis. Maybe an extra zero in there though? Eg: to go from 40k KS backers to 400k sales is 10 new copies per KS backer not 100

 

[Leith Maclaine]

^Nice analysis. Maybe an extra zero in there though? Eg: to go from 40k KS backers to 400k sales is 10 new copies per KS backer not 100

Corrected, thank you.

 

[Havamal]

FYI.
Those of you who watch the Q&As know that Mitch stated that they will never elaborate on what "success" is since it delves into details that are personal and private for the studio, amongst other reasons.

 

[TaurianMerc]

Whatever gets me quadmechs.
That's success

Right, better help me gear up for a hostile takeover of HBS.

**powers up Snow Fox**

Do we need to synchronise watches? I have a black balaclava and turtleneck, should I bring those?

 

[mmurray821]

So if they announce a DLC or expansion we know it is a "success"

 

[Havamal]

So if they announce a DLC or expansion we know it is a "success"

Maybe...

But is it success? Or "Success! "

 

[TaurianMerc]

Maybe...

But is it success? Or "Success! "

Depends on whether or not it contains Quads, doesn't it

 

[Havamal]

Depends on whether or not it contains Quads, doesn't it

Only to some Mechwarriors.

And don't confuse the success, with the potential result of it.

 

[TaurianMerc]

And don't confuse the success, with the potential result of it.

Only for the humour, old bean, only for the humour

 

[Nichino]

Mitch in good humor told the viewers in Q&A to go get 10 of their friends, family or strangers to buy a copy.

So with almost 50k backers including reinforcement backers, it is conformed that 500k copies sold in pre-order and at release will result in quad mechs as free DLC. Just kidding, although we should try to spread the word. Lord Commanders orders.

 

[Stefan Amaris Jr]

From other indie kickstarter projects I followed, the studio often ended up kicking in at least what the KS raised to top up the development budget. KS is great for getting upfront funds without signing away your IP or having to pay interest, but the past has shown that the lists of targets and stretch goals aren't always a realistic estimate of what the project costs in the end.

Then when it comes to retail sales it's not just a matter of selling as much as you raised in the KS to cover this extra development, because now you probably have a retail publisher getting a cut, Steam/GOG getting a cut (more than KS cut from what I recall) - plus, in the case of BT, whatever licensing agreements are in place with the holders of the IP which probably means a cut of sales for them too. So it could be that HBS has to sell something like 150k copies depending on regional breakdown and pricing just to get into profitable territory.

If it gets to 250k sales it's probably reasonable to assume a decent profit has been made, but this doesn't necessarily mean it's the best choice to plow this profit straight back into BT. Indie studios have to take a realistic and dispassionate look at where they focus their next efforts, you don't want to chase diminishing returns if a different project would be a better bet. So returning to Leith's analysis above, I would also consider 400k+copies sold a success, particularly for a small studio. Once they're over this I think the chances of another BT project from HBS after this one increase significantly. I'd also expect a game like this to have a long tail and generate decent revenues for them for years to come.

 

[Jack Ryan]

The way I look at it, "Success" is when the game releases. "In Success" is when we get everyone we know, their cousins, sisters, mothers and brothers to buy a copy .

There are enough people chomping at the bit to get their hands on it, across enough forums at this point, it's going to see greater success over time. If it's well reviewed, and the hype meets the hopes, with Paradox behind it helping with localization I cannot imagine it not being an amazing success.

It will be the Role Playing Battletech Game that's not, actually, a Role Playing Game. I really think that in catering to the management portion of the sim, which is something a lot of us have been looking for for a really long time, it will look and feel like a RPG to a lot of other hard core gamers.

I guarantee, part of the future success of the game will be due to community modding. Once people see what we can deliver for this game, people are gonna go nuts!

 

[Cyttorak001]

I saw a breakdown of some recent year (might have been 2016), and only 5 games sold more than 500,000 copies. Only 5 others sold more than 1 million, IIRC.
The highest was Civilization VI, with a revenue of $78 million. The average price won't be the $40 HBS is charging, since the price is different in different countries. I would guess a safe average would be $30 per copy. If they sold 100k new copies, that would be $3 million. The original Kickstarter campaign raised $3 to $4 million (depending on how you count), and was essentially pre-paid. Most revenue now is profit, I think.

So I would guess 100,000 copies is pretty good. 200,000 or more would be great.

 

[Jacobkosh]

I basically want to agree with and echo everything that Stefan Amaris just said. ^^^

My take is basically this: an unambiguous success is a project that does at least well enough to fully fund its own continued development (in a video game's case, a sequel). It probably needs to do even better than that because diminishing returns are a thing, but that's a good starting point. (It's true that a sequel in a game will have had a lot of the work done for it (the engine and some of the assets and so forth, assuming those remain constant) but on the other hand those savings are going to be eaten into by developing all the new features people want.)

So let's set the bar for success at HBS making back 2x the cost of developing Battletech to begin with.

The Kickstarter raised just shy of $2.8m, but a big chunk of that will have been lost to Kickstarter's cut and assorted fees, credit card processing, BackerKit, and the physical rewards, which always sound like an immense time and money sink and which have definitely sunk more than one otherwise-promising Kickstarter project. So let's assume that HBS maybe cleared $2m total. It's a nice round number.

Stefan mentions that a lot of Kickstarters don't fully fund the project; the studio still spends its own money in addition to whatever is raised. We know that this is the case with Battletech, both from the Kickstarter campaign itself and from many comments made by Mitch and co afterwards. To what proportion did HBS co-fund the game? I dunno, but a good rule of estimation is that in the absence of data you may as well go with a coin flip and assume that the various unknowns will cancel out. So let's assume that HBS funded 50% of the project. That brings estimated dev costs to about $4 million.

In that case, per our definition of success, the game needs to make the studio about 8 million dollars. It's retailing at $40US. Valve takes a 30% cut; I assume GOG's take is in the same ballpark. Paradox is taking its own cut for marketing and publishing services. Let's assume that half of that retail price actually makes it to the developers - HBS gets ~$20 per sale.

Which means I end up back where I started, agreeing with Stefan Amaris. 400k. And I think every big step in sales above that - 500k, 750k - dare I say a million? means that not only will we be very likely to get more Battletech in the future, but it'll also become much more feasible to pursue ongoing development on this title and start checking off boxes on the long wishlist we've all accumulated.

Except quads. Those cost billions of dollars, because of reasons.