We felt burned by the Firefox toolbar market. Reading stuff like "who would pay for anything in a Firefox toolbar?" from our players meant that we felt like we were a long way away from sustaining our company on that platform.
It had been a gamble to build the first big multiplayer social game in a browser extension, and it looked like fail: the world wasn't ready, or didn't need what we were building.
We had about $500k remaining at this time. I drew up plans to fire everyone except one programmer, to see if we could keep things running and figure out where to find some more investment or revenue.
Even working remotely from St. Louis, Marc was so plugged into our pace that it felt like we could maybe sustain the company on him alone. Marc was profoundly committed to his craft; he was an inspiring engineer to work with.
Marc Adams - Engineer, Photographer - photo from October 2008
Michael Buhr suggested we look at the last $500k as money we could use for a another startup. Maybe t would work if we had a small slice of a much larger pie: we had a functioning, kick-butt web games team, and we refocused on the most profitable market within our reach: Facebook games.
Where's the money and the action in online social games? June 2009 from insidesocialgames.com - red arrows point to "Social RPGs", the type of game we aimed to make.
This was June 2009, and social RPGs like Mafia Wars were tearing up the charts and making good money (a game called Farm Town had just debuted at #4). We were a Ruby on Rails shop; we didn't have any Flash experience. We decided that we could build a social RPG in Rails in a few weeks, then we could skin it to target different demographics. We figured that we could have multiple games up on Facebook within a few weeks.
So we shut down our toolbar game PMOG/The Nethernet, because it was a huge drain on resources and focus. That was sad, but it was easy because we were losing money so fast. In the absence of PMOG, some of our most active and frustrated players went on to create Nova Initia, another browser toolbar MMO of playful annotation.
Meanwhile the five of us -- Justin, M, Cwikla, Alex, Marc -- built a social RPG game engine that could be rapidly re-skinned. For the first skin we chose a geopolitical theme, taking Mafia battles and doing them bigger and more tough: Dictator Wars. We made the theme cartoony to sanitize and parody the horrendous political content. Here's a YouTube video promoting Dictator Wars.
I spent 10 weeks reading books about dictators and writing out content for our Dictator Wars content spreadsheet; it was fun to be a bit of a writer again. From books like Under the Loving Care of the Fatherly Leader by Bradley Martin and The Emperor by Ryszard Kapuscinski, I learned terribly sad things about the worst possible violations of trust between leaders and citizens.
I had dreams about dictators for years afterwards. I amused myself by tweeting secretly as the_kim_jong_il, scheming to build a viral social media campaign for our twisted game.
We didn't want to fail as a studio because we'd only targeted one macho audience. So we went immediately to work on a second game, targeting women: Super Cute Zoo. We thought we could add some Flash pets and an improved UI and attract multiple audiences to the basic spreadsheet RPG gameplay.
We five people launched two Facebook games in 14 weeks. It was a long march of long days. After years of having made one sort of game, we had to start all over to make other kinds of games. We succeeded at our mission -- we rebooted our studio! We got some nice press coverage from Inside Social Games: The Road to Dictatorship. We were contending on the most exciting new platform for online games!
We had to learn about Facebook fast. For example, in 2009, each Facebook user got a certain number of invites per day. Because we were fiddling with our game, we had our allocation reduced from 30 to 4 invites a day. That was a huge penalty, a giant growth slowdown for weeks, when we only had months to live.
We spent a little bit of money on pay-per-click install advertising. But we soon learned that other games were spending 10 or 100 times as much money. We were advised to spend $50k our launch week, to place on the charts and get noticed. We didn't have that kind of money, and unfortunately we didn't have that kind of time.
Facebook games were changing fast. Increasingly, farming games were all the rage. Players were expecting higher levels of interactivity. More polish. Our zoo-themed game seemed strange as a social RPG -- any game that promised you a chance to build a zoo wanted to be point and click, and instead Super Cute Zoo featured reading on static web pages.
Here's a stats snapshot, mid-October: Dictator Wars has 28k registered users, with 1700 a day playing (about 6 percemt). Average revenue per day was $53 -- about 3¢ per daily active user. The game was growing by about 100 people per day -- a paltry .3% growth rate (damn our constrained Facebook invitations!)
$50 a day is about $1500 a month; we needed 40 times that or more to sustain our company. We had busted ass, and we'd put something up on Facebook, but we didn't have the time or money to help it evolve into a successful property. With online social games, launching is just the beginning of the hard work.
As part of the second round of funding, Shasta and OATV had secured the right to purchase warrants to the tune of a few hundred thousand dollars. Shasta wanted to be able to buy a larger part of the company at the Series A price if we took off. Late 2008, we voted to extend their right to purchase the warrants, in case we needed the easy cash injection. During 2009, we aimed to be worthy of these cash injections, but by late 2009, there was no additional money coming from our investors.
Here's the last GameLayers, Inc. Board of Directors slideshow: 200910-GameLayersBoard.pdf 3.8 megs, 25 slides.
I spent much of the fall of 2009 calling people I knew who ran social gaming companies, seeing if I could find anyone to buy us, to buy our assets, to hire our team -- to provide job security for our employees and some return for our investors.
I even worked up a patent application for "System for Sharing Tasks between Players of an Online Game" to see if that might increase the value of GameLayers and help us find a lifeline to keep making games.
We had some acquisition interest from larger social gaming companies. But week-by-week, the social RPG format was losing momentum in the market against the mighty FarmVille. Basically, I could see people thinking, "Why buy this company when their games aren't growing that fast? In a few weeks we'll try to hire their engineers, maybe."
Here's some visualizations of our dwindling finances in last 2009:
October 2009, I was invited to a GameOn Finance conference in Toronto. I blame Jason della Rocca, a relentless connector of people and ideas. Participating there was cathartic -- I really enjoyed a chance to try to save other entrepreneurs from my problems and get inspired by other business experiments. Some nice folks interviewed me and posted it on YouTube.
November 2009 we pulled down our two Facebook games -- they weren't making enough money, and we couldn't commit to long-term service. We took the remaining money to pay off the company's obligations and arranged a decent severance for our people. We laid everyone off, and took a little bit of remaining money to put The Nethernet, our original game, back online to run quietly at thenethernet.com.