devtrackers.gg
Reposted from our official Stormgate website: playstormgate.com/news/frost-giant-business-faq
We are committed to being transparent with our community and know questions have come up around our funding status and crowdfunding campaigns. Please know our intent is never to mislead and we recognize there are opportunities for us to be clearer. We hope this FAQ addresses remaining questions or confusion and helps to reaffirm confidence in the great future we're planning for Stormgate.
What does Frost Giant mean when referring to “release” or “launch”?
For the dev team, the moment the game goes into full live operations is what we consider launch or release. From that moment forward, other than short server updates, our team will be continuously working to provide uninterrupted service. This is a fundamental shift for us and is unambiguously what we think of as launch or release.
Per that understanding, Stormgate will be released in Q3 of this year. This is our Early Access milestone, and we expect to spend at least another year polishing the game and expanding the scope for the next milestone, the “1.0” release, and then another year after that for the next major release. As long as the market supports it, we hope to continue expanding and improving Stormgate for a very long time.
What do we plan to include at Early Access?
We plan to provide 1v1 competitive, 3-player co-op against AI, three free introductory campaign missions, and the initial act of the Vanguard campaign when we release into Early Access. Each of these modes will continue to grow from that point, as we gradually add more maps, more Heroes, and more story chapters.
After the initial release, but still during the Early Access period, we intend to introduce the first version of our 3v3 competitive mode, our 3-player co-operative experience for campaign mode, and we plan to provide the first version of our editor. We may also share an early look at other features that we are playtesting.
How does Frost Giant expect to finance the release of Stormgate?
Independent studios typically require additional rounds of venture capital to release their games, however Frost Giant is fortunate to have already garnered strong investor support. Prior to our Kickstarter, Frost Giant raised enough capital from investors to release Stormgate into Early Access. Our investors are fully aware of our financial strategy, including the StartEngine crowd-equity campaign, and we have received strong positive support throughout.
What's the purpose of the Kickstarter and StartEngine campaigns?
The Kickstarter campaign primarily funded physical collector’s editions and offset server costs to provide wider beta access. The Kickstarter was highly successful (thank you all so much for your support!) and also generated some surplus, which Frost Giant is investing directly back into development.
Where the Kickstarter provided backers with beta access, and in some cases, physical goods, Frost Giant’s StartEngine campaign is a stock offering. Stock offerings on StartEngine (and the communication about them) are regulated by the US government. Stock value can be volatile, and it's important for potential investors to be mindful of the risks involved.
The equity Frost Giant is selling through StartEngine is aimed towards investors, but also open to the community. This is earmarked to help self-publish and market Stormgate's release in the West. It's possible that excess capital could again be generated, which would again get invested back into development.
It's also important to understand that owning stock is not the same as profit sharing. Value is derived from stock by selling that stock. When companies are at an early stage, their stock has limited liquidity. For those unfamiliar with stock trading, please consult a professional investment advisor prior to making any investments.
How will Frost Giant fund continued operations after Early Access release?
The goal of Stormgate's initial Early Access release is to deliver a profitable product, which sustains ongoing operations on the strength of its sales. Frost Giant has worked for years to build Stormgate and to create awareness. Positive indications from the Kickstarter and Steam Next Fest performance lead Frost Giant to expect that Stormgate will be successful at Early Access, while acknowledging that there is always some degree of risk.
Are you going to run out of money if you’re not profitable out of the gate?
If Stormgate is unexpectedly not profitable at the outset, Frost Giant is fortunate to have additional runway in the form of cash reserves. These reserves provide stability in the event of revenue shortfalls, and combined with revenue from Early Access release, are expected to carry Stormgate to a “1.0” launch. Frost Giant’s resources, while finite, are consistent with the original business plan – and correspondingly, we believe we have sufficient capital to achieve success.
We also have several other potential capital sources. Frost Giant expects to work with publishing partners in Asia. This means other companies would market Stormgate in Asia in exchange for regional revenue share. These deals frequently involve up-front licensing fees and/or minimum guarantees, but not always.
It's also possible that Frost Giant might strike additional platform partnerships with other PC gaming distribution services, and that Stormgate might enter into other promotional partnerships or licensing deals that produce capital. Deals in these categories, and the corresponding terms, cannot be predicted ahead of time.
Another possibility is that Frost Giant will raise additional venture capital. Although venture capital investment across the gaming sector decreased over the past twelve months, Frost Giant is a candidate for future rounds because Stormgate has demonstrated significant development progress and market traction.
Finally, Frost Giant has been offered a line of credit, in the form of venture debt, from a major bank. This can provide a certain amount of operating capital as a bridge to other funding.
How efficient is Frost Giant's spending?
Game releases from major publishers often exceed $100M in development budgets today. Frost Giant has assembled a meaningful budget for Stormgate, but it is still comparatively modest. Frost Giant intends to operate more efficiently than typical major publishers.
Major publishers’ overhead (operating cost per employee) can be as high as 100%, but Frost Giant's overhead today is closer to 25%. Frost Giant's facility costs are lower than many major publishers, since only about 40% of Frost Giant’s team works from the Irvine office at this time. Shared general and administrative (SG&A) costs are also lower, since Frost Giant doesn't currently have large internal support departments to carry, primarily just the development team. Frost Giant makes an effort to pay fair market salaries, and many team members are veterans based in major metropolitan areas of the US, so our staff costs are comparable to those of other leading developers.
In aggregate, thanks to reduced overhead, Frost Giant is more efficient than many major US publishers. Combined with increased development effectiveness from veteran team members, Frost Giant has an additional edge.
Why is Frost Giant approaching its business differently?
Until recently, most major games were funded by large game publishers. In the last five years, venture capital emerged as a meaningful new source of game funding, and this spawned hundreds of new game studios. Frost Giant is one of a small number of venture-backed studios launching a product into Early Access this year. We are one of a group of studios pioneering new ground for how games are brought to market.
Why has Frost Giant decided to self-publish, and why only in the West?
When publishers fund development, this typically gives them creative control over the game. That means that they have the final word on any decision, including release timing and monetization fairness. Self-publishing enables Frost Giant to retain complete creative control.
Working with region-limited publishing partners does not involve giving up creative control. Regional partnerships in Asia will also enable Frost Giant to better serve our players through localized communication, and to have a stronger presence in PC cafes, which are important in that region.
Where is the roadmap?
We’re working on it. Our plan is to share an overview of the content rollout plan for our next beta testing phase (codenamed Frigate) followed by our initial Early Access release (codenamed Griffin) and beyond. We plan to playtest early work on our third faction in Frigate, which should be available to closed playtesters in the first half of April.
NO MONEY OR OTHER CONSIDERATION IS BEING SOLICITED, AND IF SENT IN RESPONSE, WILL NOT BE ACCEPTED. NO OFFER TO BUY THE SECURITIES CAN BE ACCEPTED AND NO PART OF THE PURCHASE PRICE CAN BE RECEIVED UNTIL THE OFFERING STATEMENT IS FILED AND ONLY THROUGH AN INTERMEDIARY’S PLATFORM. AN INDICATION OF INTEREST INVOLVES NO OBLIGATION OR COMMITMENT OF ANY KIND. "RESERVING" SECURITIES IS SIMPLY AN INDICATION OF INTEREST.
External link →