you want to start something? » Startup

After a decade of intervention…

Matt Johnston — Wed, 23 May 2012 22:14:26 +0000

Got this in iMessage just now. Describing frustration with trying to kick off a startup in Northern Ireland.

I’ve met with a few private investors, a couple of angels, a few venture capitalists, lots of public sector funding managers and a few deal brokers. I’ve read a few term sheets – enough to realise when I need help but also, thanks to three friends in particular, read enough to realise when someone is being shafted. We’re a long way from having this fixed. And, if I am honest, after a decade of intervention, I don’t think we’re any closer to the answer.

Why?

Because the intervention was In the wrong direction. It was top down and not bottom up.

BBC Creative Collisions – Future of Media Technology #CC2012NI

Matt Johnston — Thu, 17 May 2012 14:16:31 +0000

Friday 8th June 2012
10am to 2pm includes lunch and refreshments
BBC Blackstaff Studio 62-66 Great Victoria Street – Belfast – BT2 7BB

Creative Collisions 2012 is an opportunity for you to engage in the cutting edge of media technology and innovation. Whether you want to harness technology for practical media solutions, diversify your innovative ambitions or simply enhance your knowledge, Creative Collisions 2012 is the place to be.

BE INSPIRED

BBC’s Stephen Nolan will host a ‘Live’ studio debate exploring the future of media
technology – Suggest hot debate topics NOW using Twitter #CC2012NI

Key Speakers:

Peter Johnston (Director) BBC Northern Ireland
Mervyn Middleby (Head of Technology Operations) BBC Northern Ireland
Alistair Hamilton (CEO) Invest NI

SHAPE THE FUTURE

An exciting opportunity to develop the broadcast technologies of the future with support from Invest NI, DCAL and BBC Northern Ireland – details revealed on the day!

Demonstrations from a top team of experts, including:

HD Solutions
Next Generation toolsets
Virtual Studios
iPads on the Road
Graphics innovation and many more…
Network with fellow media professionals

MANDATORY RSVP Nicola.Hollis@bbc.co.uk by Wednesday 30th May 2012

Spaces are limited – please confirm your attendance as soon as possible to reserve a place. We operate a ‘first come first served’ policy.

Perfect

Matt Johnston — Wed, 16 May 2012 18:03:27 +0000

Instagram was the topic of conversation in the office yesterday.

Date	Event	Revenues (Cumulative)
March 2010	Received $500K Seed funding and founded company. Launched 6 months later.	0
February 2011	Received $7M in Series A on a valuation above $20M	0
April 2012	Received $50M in Series B on a valuation of $500M	0

One month later they were bought by Facebook for $1.01B. Based on $57.5M of funding, two years of activity, zero revenue and millions of users.

The conversation revolved around not how to create the next Instagram but around how far behind we are in terms of an investment environment. Taking Instagram as a perfect result – investors are happy, founders are happy, employees are happy and presumably the buyer is happy.

It’s obvious that the environments are completely different between San Francisco and Northern Ireland but how different are they? There’s no way you could get $500K seed money in this province and to even get $7M in Series A would mean just leaving these emerald shores. It would be maybe not too much of a stretch to declare that it would be impossible, with public or private intervention, to get the sort of result that Instagram got. But the analysis that interests me is …

…if I came with an idea and said I wanted funding to build a company that is kinda social like Instagram and I didn’t necessarily have a revenue plan, nor did I have anything more than single product on the shelf and though it’s a deliciously simple idea, it doesn’t go far beyond tapping into a market of real geeks. It’s not for photo-nerds because they’re using DSLRs. It’s not for happy snappers because they’re just going to use the default app. It’s for a demographic that takes pictures and then applies filters and then show’s them off. (like Flickr, but for people who want weird effects). I’m building this company to flip, to exit like a swan. Risky eh?

So, armed with that idea, what would I get in Northern Ireland?

Market Research

Matt Johnston — Wed, 18 Apr 2012 07:01:04 +0000

Tomorrow I’m off to the InvestNI Business Information Centre to do some research in mobile and games for the planned Games Development Cluster, BLOC54. The problem is that you end up looking at market data reports from companies like Forrester:

“The iPhone will not substantially alter the fundamental structure and challenges of the mobile industry,’” Charles Golvin, an analyst at Forrester Research Inc., said in a report this month. (link)

or pay attention to the geniuses at Bloomberg:

The iPhone is nothing more than a luxury bauble that will appeal to a few gadget freaks. In terms of its impact on the industry, the iPhone is less relevant. (link)

This puts the researcher at a bit of a crossroads. Interested parties (whether that’s InvestNI or private investors) will want to see some market research. They’ll want to see predictions on where the market is going, thoughts on what niche you’re going to play in and they’ll want these verified by companies like Forrester, Gartner, Deloitte. The dilemma is that when the numbers from these companies agree with what you want to present then they are visionaries. And when they disagree, they’re buffoons.

This isn’t really a problem because the smart money will know the story and it’s likely that while you’re making your pitch the panel will be unlikely to be reading reports from competing organisations to try and find you out. They’re going to give you the benefit of the doubt – at least during your 3 minute pitch.

The important thing is that, positive or negative, you need to do the research.

Another Life (persistence in games)

Matt Johnston — Sun, 15 Apr 2012 18:58:08 +0000

Peter Molyneux at Eurogamer:

What I love about cloud computing – and this hasn’t been explored yet – is that it allows for something that we as gamers haven’t had since the start of gaming, and that is persistence. We don’t have worlds or experiences that can continue and last for extended periods of time. We need to get rid of saved games.

I think game designers are afraid of persistence. You have to figure out the consequences of persistence or figure out a way to fudge it. You have to explain what is going to persist, why and what happens when the game is a year old.

Look at Call of Duty. Are the wars persistent? What about the damage to buildings? And what about the dead? Eventually the bodies will start to smell. How you add persistence to an FPS will change the game. Who’s making the ammunition? We’ve bombed all the factories?

Look at Warcraft. Eventually you’ll have chopped down every tree and mined every mine. Eventually the Undead will likely take over by amassing huge shambling armies. Adding persistence means thinking about the long term consequences.

And what happens in persistent worlds with clues and traps? Do you come across the body of previous players? Or do you brave the terrors of the dungeons only to find the burial chamber contains only the burned out campfire of the guys who looted it before you?

But I don’t think Mr Molyneux is being particularly prophetic. Persistence is the Next Big Thing in games. The challenge will be in not making it awful.

Some companies will deal with it in terms of expansions. More new places to go. Others will use resets. Once a year, everything gets ‘reset’ after a fashion. Others still will place their game in a sandbox. New resources will be supply drops.

What I’m interested in is a game where the structures are built by people playing Sim City or Minecraft. They’re destroyed by people playing Call of Duty and Warcraft. Supplies are generated by people playing FarmVille and shops are staffed by people playing Dead Hungry Diner. Bystanders in the street are Sims, crossed with GTA.

They don’t have to be playing the same game. But what’s to stop a Sim shopkeeper (in real life, a lawyer from Seattle) playing out an interaction with a grizzled CoD veteran (in real life, a 35 year old video store clerk from Miami). The CoD player is playing his favourite FPS and from his point of view is trying to track down the whereabouts of a possible insurgent in the area. The Sim player is interacting via SMS messages and emotes on his mobile phone. He’s dialled up the realism so later that day, he’s interacting with a GTA mugger (in real life, a 17 year old college student on her summer holidays) and escaping with his life but not his wallet.

Isn’t that what Second Life should have been?

LTEC

Matt Johnston — Fri, 13 Apr 2012 12:29:26 +0000

Often misattributed to Marie Antoinette, “Let Them Eat Cake” is not a unique story:

In Chinese culture, there is (attributed to Emperor Hui of Jin by the book Zizhi Tongjian) a story that involves rice and meat, instead of bread and cake: “an ancient Chinese emperor who, being told that his subjects didn’t have enough rice to eat, replied, ‘Why don’t they eat meat?’”.

It has been said that our government is risk-averse. Not very risk-averse when it comes to permitting farmers to over-claim on EU subsidies, but risk-averse when it comes to anything that doesn’t involve ships.

Whether it’s building ships or filling boxes with polystyrene and loading them onto ships, it’s the same principle. They like ships. Nothing else can explain the morbid fascination (and exploitation) of the tragic Titanic disaster.

Investing in digital content and software is not the same as building a ship. It is risky. It’s unlikely to cause the deaths of 1500 people but it has risk. The issue is that because they don’t understand it (and they don’t see how it can directly benefit them) our politicians find it difficult to justify the investment.

60% of our economy depends on the public sector but it only employs 30% of our workforce. Think about that in terms of salary levels and why there is no incentive for local workers to enter the private sector. And why the public sector has, for generations, been a viable option.
The app economy created half a million jobs in the US. We should have gotten two thousand but we managed about a hundred. Lack of investment in skills development, lack of assistance for start-ups and lack of investment full stop meant we were not able to capitalise on this opportunity.
Digital is the new norm. So says PWCs outlook report for 2011-2015. Digital spending is growing three times faster than non-digital. It will, they estimate, account for 58.7% of all growth in spending during the next five years.
We train fewer software engineers every year than death and retirement take away from us. Our current demands for software skills are such that it would take two years at double production to fulfil current demand, never mind the inevitable higher demand in the future.

Government assistance schemes are meant to address market failure. In my experience the schemes presented propagate failure by restricting assistance to the organisations who do not need it. This highlights the risk-aversion in our economic development.

InvestNI failed to spend nearly £50m of their budget during the last two quarters due to a lack of investment in R&D by client. This represents a significant failure in outlook and forecasting considering it’s obvious we have been in the grips of a recession for four years.
Speaking to DEL: they can’t help small companies employ people. If you’re hiring ten people, they can put a programme around you. This ignores the reality that more than 80% of the NI private sector are SMEs and the vast majority are micro-businesses.

At our briefing to the Culture, Arts and Leisure committee last month, we raised eyebrows by explaining all of this. Because the committee believed what they were told by other departments. As long as we continue to believe press releases from government on the quality and quantity of our skilled workforce, we will never progress. You cannot fix a problem that you do not acknowledge. You cannot address a need that you deny.

In my position I hear about a lot of local businesses closing their doors. And while some of my friends and colleagues are doing well, it’s not across the board. Those who are doing well are not in the position to capitalise on their fortune. They’re maintaining and sustaining.

And this is why every platitude from government reads like “Let Them Eat Cake”. Our local industry is still in the grips of a recession and government is intent on removing any and all supports for the development of the industry. They’re removing the bread from our mouths by not developing skills locally, by encouraging ephemeral foreign direct investment and displacing locally bred talent.

Conquest Dynamics: Codename Adams 2

Matt Johnston — Fri, 06 Apr 2012 17:55:18 +0000

Aidan continues.

Conquest Dynamics: Codename Adams

Matt Johnston — Fri, 06 Apr 2012 16:54:34 +0000

Aidan has been sketching out storyboards for the intro movie….

So why not Kickstarter

Matt Johnston — Fri, 06 Apr 2012 08:09:59 +0000

I got this question yesterday. If I want to do this, why not use Kickstarter as it’s been such a success for heaps of stuff.

The world famous Double Fine Adventure sets a precedent. A small team of dedicated people can achieve great things.

But, ultimately we’re not ready for that. We’ve got the start of a team with Aidan and Willem. We’re trying to raise some cash for assets – images, music, animations, movies. We have our Lo-Fi movie, a wiki that’s growing with game design features and background and we’re talking to Northern Ireland Screen about what they can do to help.

We’re not ready for something like Kickstarter because we don’t have the twelve year background of Double Fine Productions, the reputation of Tim Schafer, the back catalogue of 2 Player Productions. Kickstarter is a big step and we’re not ready because we don’t have anything to show.

We’d like help to get there.

We’re on Seedups.com

Matt Johnston — Wed, 04 Apr 2012 07:00:35 +0000

Though, to date, we’ve had one inquiry. So rather than hide it all behind a wall, here’s what we’ve written. As my theory is that telling no-one was getting us nowhere, I’m now telling everyone.

About Matt

1990-1994 BSc Hons Genetics
1994-1996 PgCert Computers and IT
1996 Joined Nortel
1996 Published first game: The 23rd Letter
1998 Published second game: SpaceNinjaCyberCrisis XDO
2001 Published third game: Zombi: the earth won’t hold the head
2003 Started own IT company, MacSys Ltd
2006 Started Infurious software
2008 Started developing Digital Circle in Northern Ireland
2011 Put together the team for Conquest Dynamics

Business Opportunity

We will need an initial £200,000 of funding to produce the first game and the development of the initial IP for the second and third. We are not aiming for the 69p market, but rather delivering some new ideas in social and multiplayer games which will drive payer recruitment and engagement.

Our initial game has a basic game design document but this also needs enhancement and we are keen to find additional advice as well as funding to assist in the delivery of this.

The opportunity in a global, networked marketplace is immense thoughwill only be realised through appropriate marketing, use of social media and development of a die-hard player community.

We aim to sell more than a million copies of each game each year and establish four important new properties over the next five years.

Product/Service

We will make games and sell them. A lot.

We have one developed idea and three further games on the slate and a dozen more in the distance.

Market Information

We are aiming for a market segment that is at the intersection of 11M subscribers to World of Warcraft and 65 million iPads.

We will be targeting a sector we know well. Gamers who have limited time, some money to spend and a desire to play games which have more depth than casual games. We’re targeting gamer dads.

Financial Information

To be decided. Come and talk to us.

We’re looking for a committed partner who will provide more than just funding. We’re in for a roller coaster; we have big plans so come and talk to us.

Intellectual Property Information

We will be developing new content-based intellectual peoperty based on original ideas and tell engaging stories.