Curt Schilling has remained quiet since 38 Studios declared bankruptcy, but the failed company's founder and public face came out Friday morning to own up to his many mistakes that led to its collapse.
Speaking with Boston sports radio show Dennis and Callahan in his first interview after the Rhode Island-based developer filed for Chapter 11 bankruptcy protection, Schilling took responsibility for not informing employees about just how much trouble the MMO developer was in.
"The employees got blindsided," he said. "One of the many, many mistakes I think that was made -- or that I made, or that we made as a leadership team -- was that this came out of nowhere for them."
He said the company's nearly 400 employees learned about 38 Studios' financial difficulties when Rhode Island Governor Lincoln Chafee told the public that the developer was struggling to stay solvent. The company collapsed soon after that, and was forced to lay off all its workers when it couldn't make payroll.
Schilling said, "They didn't deserve it. It was not how we ever did business. The employees were everything. That was what the company was and it was about. … I always told everybody, if something were going to happen you're going to have a month or two lead time. And I bombed on that one in epic fashion."
He added that the primary reason 38 Studios ran into so many problems and was unable to make its loan payments to the state is that the company failed to raise private capital. But Schilling claimed Governor Chafee wanted to see the developer fail, and that his public comments scared off potential investors that were poised to save the studio.
"I think he had an agenda and executed it," said Schilling. "If you remember, after Governor Chafee went into office, he came by the studio, he had made a public comment that he was against the deal before he got elected but now that he was in the office he was going to everything he could do to help this company succeed. And that absolutely unequivocally never ever happened in any possible way."
Schilling also admitted that he invested over $50 million in the company as it toiled for more than six years on its MMORPG Project Copernicus, but despite all of the company's work and money poured into the title, it wasn't anywhere near completing the game before the studio declared bankruptcy.
"I put everything in my name in this company," he said. "I believed in it. I believed in what we had built. I never took a penny from this company. I never took a penny in salary, I never took a penny for anything."
Now the former Red Sox pitcher being sued for millions over loans given to 38 Studios, and the FBI, the U.S. Attorney's office, and local authorities are investigating the company.
Though some 38 Studios' former workers have said that Schilling's naivete led to the company's death, some have called him one of the "good guys" throughout this ordeal, and insisted that the media's negative portrayals of the founder are undeserved.
"I'm not asking for sympathy," said Schilling during his interview with Dennis and Callahan. "That was my choice. I chose to do this. I wanted to build this. I wanted to create the jobs and create something that had a very longstanding world-changing effect. We were close. We were close to getting there. It just fell apart."
Sorry but I doubt that he did his best to keep the employees in the loop...something like this he would've/should've had some sort of insight and knowledge of if the company was about to fold and hadn't been able to make payments for key things.
I agree with Philip generally and I'm not a fan of a lot of the crud that went down (obviously).
Although I will consider one thing after reading this one- it has to be hard to see something you've dreamed about crumble so completely and spectacularly. If he did sink so much of his own money in... I can have a bit more sympathy.
How could he not see what was happening? Who the hell in upper management did NOT tell him of what was going on (or in that sense, being truthful)? Either he knew or the info being passed along was filtered.
The article left out the part that Curt was a day away from practically closing on a $35-38 million loan from a private investor, and they walked away completely once Chafee started tossing out words like Solvency. They also didn't mention the $8 million tax credit that were promised to them that Chafee reneged on. That $ would have covered his staff for months until their other financier would have come in. He mentioned in that show they had someone waiting to write $15-20 Million check once the $8 Million in taxes came in. So Curt genuinely thought the money was going to be there and never thought it was going to be that close before they had to let the staff go.
"The article left out the part that Curt was 'a day away' from 'practically closing' on a $35-38M loan" — check's in the mail, I swear!
The company didn't have enough money to make their game or enough of a business plan/reputation/product to continue getting financing. Chafee didn't torpedo 38—everyone saying he did is just shooting the messenger in my view.
actually from several of the staff the game was very far into development, some said it could have shipped as is. They were playing it on a regular basis against other country's. They just had a level of perfectionism they wanted it to be at before they opened the flood gates.
Viewing the whole 38 studios thing from a distance, here's what I see. Schilling was a guy with a lot of money and connections who wanted to make an awesome game in a genre he loved. Making a game is way more difficult than anoyone without industry experience could foresee, and making an MMO is tenfold worse. He got in over his head. We shouldn't blame him for trying.
There certainly is blame to go around for how things were handled in the end. No excuses. But it's hard for any of us to imagine the absolute insane amount of pressure, stress, and emotion of his situation as things started to unravel. It would be tough to think or act clearly with so much at stake. I can understand how a person, with little business experience and tremendous personal attachment to a project might try to cling to any last hope of financing until things are too late.
It's a tragedy so many lives were uprooted, and so much money wasted. It could have been handled better. But this is what happens when businesses fail.
You don't think investing 50 million of his own dollars isn't accepting responsibility? I believe that is the ultimate commitment. Business' fail, and they sound like reasonable circumstances.
With any endeavor where any significant sum of money is at risk I like to make sure I understand the investment I am making as much as possible. My problem with 38 Studios and the way it was handled is that it seems like Curt Schilling in his naivete invested a large chunk of money into a business of which he had little to no understanding. Just because I like eating at a certain fast food restaurant franchise doesn't mean I'm going to open up a bunch of franchises myself. I don't understand the business and what it takes to run it. In my mind, it would be idiotic for me to try such an endeavor without first putting in some sort of due dilligence.
I don't know what sort of research Curt put into the day to day operations of the games industry other than playing a lot of Everquest and deciding he liked MMOs enough to want to make them. Unfortunately, this whole situation affects not only Curt and his family, but the families of hundreds of others as well.
I have a feeling this is going to be an interesting and crazy story as the finger pointing begins. Right now we hear about Curt Schilling, but what about all of the other executives? I find it hard to believe nobody at all knew of the dire straits 38 Studios was in.
Yeah this is sad that lots of individuals got uprooted. That really sucks but I got to say again,......what the hell does a professional baseball player, comic book extraordinaire, and a sci-fi novelist know anything about how to create an awesome game experience? That was doomed from the beginning!!!!!!!!
They know D#ck about game industry and D#ck about the real-estate market (promising homes would sell? Really?), not to mention,....D#ck about how to wrestle 400 plus onto an already confused project!!!
Kinda have to wonder how many gullible individuals brought into the gimmicks of working with celebrities would get them somewhere along with big notoriety or fame. Sounds like a circus promoted by celebrity apprentice disaster!!!
I'm not trying to be cold, I will say my heart goes out to the victims of this fiasco but,....really?
If its too good to be true; trust me it is!!!!!
Industry is going through enough pain with failed projects and inexperience to add the torment in an economy that is already shit!!!!!!
I do hope these displaced families find opportunity elsewhere.
Hey Curt, I'll play you a song on the world's smallest violin (My index w/ thumb screeching)
Stick to throwing rocks on a lake and see how many times it skips. YOU SUCK!!!!!
If you really want to fess up, try a fund raiser for the victims of 2012, use your celebrity status and give money to the displaced!!!!!!!
And to the displaced,.....
Don't work with celebrities again. Lesson learned!!!!!
It's unfortunate that Curt has generally taken the full brunt for this fiasco in the public eye, but that's how it goes when you're the public figurehead for your business.
The ultimate accountability for the numerous business and communication failures should fall on that executive leadership team. The epic mistakes were prevalent throughout the company's timeline and did not just magically happen in the last couple of months prior to it closing down.
Like I said in a previous comment, they're all going to go on to find a nice job somewhere else in the industry and never have to own-up to their roles in the mistakes that led to the studio's hard downfall. I am disgusted that gross incompetency on that level never gets nailed and it's always the guys and gals in the trenches who have to pay the price.
I want to commend Schilling for owning up to his mistake of how he treated the 38 studios employees, but it seems like an empty apology. I haven't heard a word on him (or any of the leadership team) trying to help employees with the mess he got them into. Even if he's broke he can still help them out w/ using his connections to tie up lose ends (like the moving costs 38 studios promised to pay and never did leaving the bill to the employee).
Just to give you a clear picture of how bad this was for 38 studios employees. First the company moved. The financial stress of moving to a new place is pretty high even if 38 studios fitted the moving costs. We're talking everything from down payments on home loans to schools, leases, ect. The 2nd part is that the company moved to Rhode Island where tech jobs are scarce, and the nearest game development studio is in Boston. Essentially 38 studios employees would have to move again to find new work. Then instead of informing 38 studios employees about the upcoming financial troubles he just missed pay roll. That means the employees had to make a choice to stick it out or start packing for a new job w/ no information to go on. Essentially employees couldn't start looking for a new job cause they had no clue what was going on with their current one, and they weren't getting paid while they were working. Then after the company has resolved all of 38 studios creditors are coming after employees trying to get the money they're owed.
I'd like more info on how the company was run, from a production standpoint. It seems to me that with the numbers they had, and the time and money that was spent, completion of an MMO of some kind might have been possible. For the sake of the games industry as a whole, I think it'd be really educational to delve into the details, post-mortem style, and see what the issues were that caused the project to take as long as it did. Were the goals too ambitious? Were there too many unknowns? Was there too little visibility into the progress? Where were the bottlenecks in terms of skill sets? etc.
I would hope that, with a better understanding, the industry can perhaps avoid situations of this magnitude in the future, and save its constituents from having to suffer in the way that 38 Studios employees have suffered.
I agree with you. We need more info (if that'll ever be possible).
From my view... (which is very subjective since IMO, this situation basically proved how to NOT run a game studio) there were at least 5 main issues.
A) Project scope outweighed available funding. While I can imagine 38 studios leadership counted on additional funding... if your studio can't ship an MMO in less than 2 years with $150 mil ($50 mil that Curt put in, $75mil from RI, and whatever money they brought in from their first RPG)... there's a problem with scope.
B) Communication. Even the letter from the spouse basically said her husband noticed the lack of communication between teams, and when he brought it up, he was shuffled away. That's a red flag. Also, the lack of communication between leadership in the devs in regards to possibility of their payroll / insurance checks bouncing.
C) Staffing. It sounds like they had the wrong people in leadership. From what it sounded like, Curt seemed to recruit top executives... but it doesn't seem like they did what was needed.
Jennifer MacLean was on family leave.. but she was apart of the company since 2008, she had to have seen the balance sheet at some point. She has experience in a leadership position, so I'm unsure what the heck happened under her leadership.
I think Todd McFarlane was a very poor choice. I suspect he only got in because he was a huge sports fan and basically rubbed elbows with Curt a few times.
BILL MROCHEK as 'online services' VP was a wtf move. He had little to no experience in that specific role, yet he seemed to walk right into it.
JASON ROBERTS as executive producer is questionable at well, however his MMO experience probably would have been helpful.
BILL THOMAS looks like a AAA COO... the question begs, why did communication breakdown between him and Jennifer (because that could very well cause a fiasco like this).
RICK WESTER - As much as I'd like to point a finger at him, as a CFO, I bet his stress was off the charts trying to manage the financial future of 38, as his experience has shown he knows how to manage money.
GAVIAN WHISHAW - Lastly - there's not enough info on him. While his bio says he worked on projects for Crytek & EA, it doesn't mention which and in what capacity. It brings into question if he should have really been a studio general manager.
D) Failure to ship said MMO before it was too late. Most people know success isn't about perfection, its about iteration. While I hate buggy games, if all studio's waited till perfection, about 1/2 the games would never ship. Shipping the MMO say 1-2 months BEFORE this happened (because I'm confident the CFO could have seen this coming), would have bought some time and possibly brought in some investors. They should have offered a discounted beta version, and then once they finalized their 'gold' revision, then ship at standard prices and give beta testers a free & discounted keys for 2 of their friends. This would have gotten the game into more hands quickly and would have had a community rooting for it.
E) Finally, they didn't get their branding around to the common/general gaming community. Until this fiasco, I never even heard of 38 studios. While I may be a hermit at times, I keep in touch with enough gamers who do play every game out there... and 38 studios never made that big of a splash.
In response to Sean with regard to Bill Mrochek, Bill was the business lead for a unit of 38 Studios that had nothing directly to do with MMO development. Rather that unit was tasked with creating software distribution and services technology, which they did and which successfully served the company's needs in launching Amalur: Reckoning.
Prior comment: "You don't think investing 50 million of his own dollars isn't accepting responsibility? I believe that is the ultimate commitment. Business' fail, and they sound like reasonable circumstances. "
No, I don't agree when you have left the taxpayers holding the bag for all those millions. Also, has there been any independent confirmation at all that the guy put his own $50 million in and left it there? At this point he has zero credibility.
I think the better lesson to learn is to separate your business from politics as much as possible. There were clusterfucks to be had all around, but being used as a political pawn was imo the worst.
Even if it wasn't the reason they failed, they were the proverbial parachute made of bricks that made their fall that much harder.
"Also, has there been any independent confirmation at all that the guy put his own $50 million in and left it there? At this point he has zero credibility."
I'd say it's pretty credible as he and the company have been audited pretty continuously for the past 2 years.
Although I will consider one thing after reading this one- it has to be hard to see something you've dreamed about crumble so completely and spectacularly. If he did sink so much of his own money in... I can have a bit more sympathy.
The company didn't have enough money to make their game or enough of a business plan/reputation/product to continue getting financing. Chafee didn't torpedo 38—everyone saying he did is just shooting the messenger in my view.
edit: Here's a direct link to the audio. Definitely worth a listen for anyone interested in the business side of things.
http://audio.weei.com/a/58102999/curt-schilling-invested-more-than-50-million-an
d-haven-t-seen-any-of-it.htm
There certainly is blame to go around for how things were handled in the end. No excuses. But it's hard for any of us to imagine the absolute insane amount of pressure, stress, and emotion of his situation as things started to unravel. It would be tough to think or act clearly with so much at stake. I can understand how a person, with little business experience and tremendous personal attachment to a project might try to cling to any last hope of financing until things are too late.
It's a tragedy so many lives were uprooted, and so much money wasted. It could have been handled better. But this is what happens when businesses fail.
I don't know what sort of research Curt put into the day to day operations of the games industry other than playing a lot of Everquest and deciding he liked MMOs enough to want to make them. Unfortunately, this whole situation affects not only Curt and his family, but the families of hundreds of others as well.
I have a feeling this is going to be an interesting and crazy story as the finger pointing begins. Right now we hear about Curt Schilling, but what about all of the other executives? I find it hard to believe nobody at all knew of the dire straits 38 Studios was in.
They know D#ck about game industry and D#ck about the real-estate market (promising homes would sell? Really?), not to mention,....D#ck about how to wrestle 400 plus onto an already confused project!!!
Kinda have to wonder how many gullible individuals brought into the gimmicks of working with celebrities would get them somewhere along with big notoriety or fame. Sounds like a circus promoted by celebrity apprentice disaster!!!
I'm not trying to be cold, I will say my heart goes out to the victims of this fiasco but,....really?
If its too good to be true; trust me it is!!!!!
Industry is going through enough pain with failed projects and inexperience to add the torment in an economy that is already shit!!!!!!
I do hope these displaced families find opportunity elsewhere.
Hey Curt, I'll play you a song on the world's smallest violin (My index w/ thumb screeching)
Stick to throwing rocks on a lake and see how many times it skips. YOU SUCK!!!!!
If you really want to fess up, try a fund raiser for the victims of 2012, use your celebrity status and give money to the displaced!!!!!!!
And to the displaced,.....
Don't work with celebrities again. Lesson learned!!!!!
The ultimate accountability for the numerous business and communication failures should fall on that executive leadership team. The epic mistakes were prevalent throughout the company's timeline and did not just magically happen in the last couple of months prior to it closing down.
Like I said in a previous comment, they're all going to go on to find a nice job somewhere else in the industry and never have to own-up to their roles in the mistakes that led to the studio's hard downfall. I am disgusted that gross incompetency on that level never gets nailed and it's always the guys and gals in the trenches who have to pay the price.
Just to give you a clear picture of how bad this was for 38 studios employees. First the company moved. The financial stress of moving to a new place is pretty high even if 38 studios fitted the moving costs. We're talking everything from down payments on home loans to schools, leases, ect. The 2nd part is that the company moved to Rhode Island where tech jobs are scarce, and the nearest game development studio is in Boston. Essentially 38 studios employees would have to move again to find new work. Then instead of informing 38 studios employees about the upcoming financial troubles he just missed pay roll. That means the employees had to make a choice to stick it out or start packing for a new job w/ no information to go on. Essentially employees couldn't start looking for a new job cause they had no clue what was going on with their current one, and they weren't getting paid while they were working. Then after the company has resolved all of 38 studios creditors are coming after employees trying to get the money they're owed.
I would hope that, with a better understanding, the industry can perhaps avoid situations of this magnitude in the future, and save its constituents from having to suffer in the way that 38 Studios employees have suffered.
From my view... (which is very subjective since IMO, this situation basically proved how to NOT run a game studio) there were at least 5 main issues.
A) Project scope outweighed available funding. While I can imagine 38 studios leadership counted on additional funding... if your studio can't ship an MMO in less than 2 years with $150 mil ($50 mil that Curt put in, $75mil from RI, and whatever money they brought in from their first RPG)... there's a problem with scope.
B) Communication. Even the letter from the spouse basically said her husband noticed the lack of communication between teams, and when he brought it up, he was shuffled away. That's a red flag. Also, the lack of communication between leadership in the devs in regards to possibility of their payroll / insurance checks bouncing.
C) Staffing. It sounds like they had the wrong people in leadership. From what it sounded like, Curt seemed to recruit top executives... but it doesn't seem like they did what was needed.
Jennifer MacLean was on family leave.. but she was apart of the company since 2008, she had to have seen the balance sheet at some point. She has experience in a leadership position, so I'm unsure what the heck happened under her leadership.
I think Todd McFarlane was a very poor choice. I suspect he only got in because he was a huge sports fan and basically rubbed elbows with Curt a few times.
BILL MROCHEK as 'online services' VP was a wtf move. He had little to no experience in that specific role, yet he seemed to walk right into it.
JASON ROBERTS as executive producer is questionable at well, however his MMO experience probably would have been helpful.
BILL THOMAS looks like a AAA COO... the question begs, why did communication breakdown between him and Jennifer (because that could very well cause a fiasco like this).
RICK WESTER - As much as I'd like to point a finger at him, as a CFO, I bet his stress was off the charts trying to manage the financial future of 38, as his experience has shown he knows how to manage money.
GAVIAN WHISHAW - Lastly - there's not enough info on him. While his bio says he worked on projects for Crytek & EA, it doesn't mention which and in what capacity. It brings into question if he should have really been a studio general manager.
D) Failure to ship said MMO before it was too late. Most people know success isn't about perfection, its about iteration. While I hate buggy games, if all studio's waited till perfection, about 1/2 the games would never ship. Shipping the MMO say 1-2 months BEFORE this happened (because I'm confident the CFO could have seen this coming), would have bought some time and possibly brought in some investors. They should have offered a discounted beta version, and then once they finalized their 'gold' revision, then ship at standard prices and give beta testers a free & discounted keys for 2 of their friends. This would have gotten the game into more hands quickly and would have had a community rooting for it.
E) Finally, they didn't get their branding around to the common/general gaming community. Until this fiasco, I never even heard of 38 studios. While I may be a hermit at times, I keep in touch with enough gamers who do play every game out there... and 38 studios never made that big of a splash.
No, I don't agree when you have left the taxpayers holding the bag for all those millions. Also, has there been any independent confirmation at all that the guy put his own $50 million in and left it there? At this point he has zero credibility.
Even if it wasn't the reason they failed, they were the proverbial parachute made of bricks that made their fall that much harder.
"Also, has there been any independent confirmation at all that the guy put his own $50 million in and left it there? At this point he has zero credibility."
I'd say it's pretty credible as he and the company have been audited pretty continuously for the past 2 years.