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Shade_Jon

Help needed for strange situation

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I was offered a position as Game developer / IT person at a company that doesn't exist yet, but is hoping to start soon. Naturally I won't be taking the position until it does. The organizer of the company is a business man. He doesn't know anything about IT or even game developement other than the specific very simple types of games he wants developed. As the IT person, my job is only to coordinate all of the work as it is outsourced. As the game developer, my job is to design the games and game flow, but the programming and graphics will also be outsourced. Again, I am supposed to coordinate this. The games should be fairly easy to design for the most part. Think Tetris complexity. The rest of the company will be a CEO, marketer, and secretary. I am supposed to tell him under what terms I am willing to accept the position, including either only salary or less salary plus shares in the company. I have no idea what to ask for here. More information provided upon request, to the best of my ability. Naturally, I can't reveal the exact nature of what we're doing, but the idea sounds pretty good to me, so I think it might be moderately successful, but you never know. Yehuda

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I am supposed to tell him under what terms I am willing to accept the position, including either only salary or less salary plus shares in the company. I have no idea what to ask for here

If I was in your position, I would want to know how many successful businesses the guy has at present or had previously, because a new start-up company is very hard to keep going, especially (although not only) if it's not in an area of his expertise.

As to what to ask for - if you're an optimist, ie the company will make quality games that the market wants (and continues to want) therefore earning itself heaps of dosh in the long run, then go for reduced salary and share options...however, if you're a pessimist, ie the company wont last very long, for whatever reason, (even if it does make quality games) and the revenues don't materialise as predicted which, in turn, means less dosh for the future, then go for the reasonable salary.

It's a tricky one - Good Luck!. [smile]

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Thanks, evelyn.

The guy ran a hugely successful business in the early 1970s which appears to have made him wealthy. Since then, he told me that about half of his businesses have been successful.

I don't expect this company to make heaps of cash; it is not aiming for market "hits". It is focussed within a more temperate and reasonably large area; if successful, it can grow and do nicely.

The point of the games is more the market and the adaption than the games themselves.

What is a reasonable percentage of shares to ask for?

Yehuda

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> Think Tetris complexity.

What's the platform? Flash? Cellphones? PDA?


> As the game developer, my job is to design the games and
> game flow, but the programming and graphics will
> also be outsourced.

Your job is essentially a mix of game designer and producer. In other words, you need to be both highly creative and very good project/contract management. How comfortable are you in assuming both these roles at the same time?

From a contractual perspective, who is in charge of writing up those contracts for both the suppliers (outside contractors) and customers perspectives? How many simultaneous projects will you be driving? Just remember that you sit in between customers and suppliers and you are ultimately responsible for the deliverables! It's a perfect situation for building up your stress level.


> He doesn't know anything about IT or even game developement

What are the financial & operational mechanics here? In other words, how will you justify project costs & increases, resource allocation, schedules & slips, etc. to a guy who doesn't understand software development?


> I am supposed to tell him under what terms I am
> willing to accept the position

Who owns the IP you will be creating? What happens to your rights (if you have any) after you depart the company?



Just a few questions from the top of my head.

-cb

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What's the platform? Flash? Cellphones? PDA?


Relevance?

Quote:

Your job is essentially a mix of game designer and producer. In other words, you need to be both highly creative and very good project/contract management. How comfortable are you in assuming both these roles at the same time?


Good question. I don't know.

Quote:

From a contractual perspective, who is in charge of writing up those contracts for both the suppliers (outside contractors) and customers perspectives? How many simultaneous projects will you be driving? Just remember that you sit in between customers and suppliers and you are ultimately responsible for the deliverables! It's a perfect situation for building up your stress level.


A lawyer, not me.
Probably no more than ten very simple games, plus IT coordination, which, if I'm lucky, won't involve much after initial set up.

Quote:

What are the financial & operational mechanics here? In other words, how will you justify project costs & increases, resource allocation, schedules & slips, etc. to a guy who doesn't understand software development?


You never really know, but he seems to be willing to trust and defer to my judgement. In any case, a CEO will have to be hired, and I will have to work it out with him or her.

Quote:

Who owns the IP you will be creating? What happens to your rights (if you have any) after you depart the company?


As someone who knows a lot about IP, I can tel you that I will have no interest in possessing the IP for these games. They will not any value outside of the targeted market, anyway.

Thanks. Good questions.

Yehuda

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> Relevance?

If you have many SKUs to maintain (which is prevalent in the cellphone gaming business for example), then developing a multi-platform expertise is going to be difficult when everything is outsourced.


> A lawyer, not me.
> Probably no more than ten very simple games, plus IT
> coordination, which, if I'm lucky, won't involve much
> after initial set up.

You are essentially put in charge of a cost center. You have a lot of weight into the profitability equation, yet you don't seem to be in control of the contractual agreements with your suppliers (which, btw, is the bulk of your cost center's expenses), especially the deliverables and schedules. Otherwise, you seem to have some control over the product itself and possibly over its quality. The other side of being in charge of the biggest cost center in a startup is that you will be scrutinized by the investors. They will be monitoring your cash flow very closely, especially what we call the "cash burn rate".

I'm not saying that's good or bad, just pointing out what the job entails as you described it.


> I have no idea what to ask for here.

Depends on your tolerance to risk. A no-risk option is simply a salary, but there is no upside to you if the company takes off. If you want to add shares to the mix to cover the upside, then you should be curious as to how the deal is structured (loans, preferred shares, other investors, share dilution provisions, etc), and try not to put yourself in a situation where you bear more risk and/or more personal liabilities than the investors. As for bonuses, I'd put them aside for now as it takes a stable business to begin with in order to properly evaluate employee performance. They are more appropriate for sales people rather than engineering people in startups anyway.

Hope this helps.

-cb

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