Indie Developer Contract
by BrokeAss Games · in General Discussion · 10/06/2005 (7:23 am) · 9 replies
I'm in the proccess of trying to find/create a contract for my future developers.
My company is an indie dev company creating a game mostly for fun that currently makes no money.
Strictly a "grass roots" operation.
I have paid nearly all the costs/overhead myself, and created the majority of the product and company.
I will allways be on "point" and the devs working with me will provide "cover fire".
My game speak is better than my legalese. :)
What I'm looking for is a contract that promises future devs a spot in the credits and if enough time is put in with the company, a position in the company if it ever turns a profit and can pay it's employees.
I'm not into cutting up a "pie" that doesn't exist, I'd rather give credit where it's due and keep the team together in their respective positions if we "make it".
Getting an indie dev company to pay for itself is going to be hard enough and it may be awhile before we have a few pennies to haggle over.
The current moto at BrokeAss Games is "I pay to work here.".
We all think it's pretty funny but a couple of our new members would like to see something "in writing".
Since I'm beginning to get organized it makes sense, but I can't find a contract template that resembles anything like this and I can't afford a lawyer to draw it up.
Does anyone have any ideas or a sample contract?
Ari
My company is an indie dev company creating a game mostly for fun that currently makes no money.
Strictly a "grass roots" operation.
I have paid nearly all the costs/overhead myself, and created the majority of the product and company.
I will allways be on "point" and the devs working with me will provide "cover fire".
My game speak is better than my legalese. :)
What I'm looking for is a contract that promises future devs a spot in the credits and if enough time is put in with the company, a position in the company if it ever turns a profit and can pay it's employees.
I'm not into cutting up a "pie" that doesn't exist, I'd rather give credit where it's due and keep the team together in their respective positions if we "make it".
Getting an indie dev company to pay for itself is going to be hard enough and it may be awhile before we have a few pennies to haggle over.
The current moto at BrokeAss Games is "I pay to work here.".
We all think it's pretty funny but a couple of our new members would like to see something "in writing".
Since I'm beginning to get organized it makes sense, but I can't find a contract template that resembles anything like this and I can't afford a lawyer to draw it up.
Does anyone have any ideas or a sample contract?
Ari
About the author
http://www.youtube.com/user/BrokeAssGames
#2
Most game companies contract developers for hire.
We are a group building an MMORPGFPS (please, no comments) that has very limited funding.
So we are not able to pay our developers currently.
We are building the game for the love of it, but it is becoming apparent that completion is actually possible.
So we needed a business solution different from the norm.
What we are doing is creating milestone contracts that have a due date and a list of tasks.
Then we negotiate the monetary value of the contract and rate it at 4 times the amount.
If and when our company breaks a certain monetary value ($100K just to give an idea), the contracts will be able to be collected on.
When one milestone contract is complete another is negotiated.
This allows a typical "build my super kewl MMORPG for free" company to operate.
75% or more of the company's income will be kept with the company, this is what the overhead and contracts are paid from.
The original founders of the team have a tiny percentage added to their milestone contracts that allow them to earn pieces of the company's profits (up to a point).
Basically, IF the company succeeds, a developer can present his stack of milestone contracts and collect money for his/her work.
It also provides incentive for the developers to complete tasks on time (or earlier) so that they can go on to the next.
We also have a volunteer contract for people who want to donate a small piece of their time/work for a spot in the credits.
After spending 2 years on this game project, I was worried about recruiting slackers who wanted a piece of the company but weren't going to put in the work.
This is my solution and everyone on the team has agreed that this is fair.
I hope this helps any indie teams that have limited or no funding.
If I don't post a contract template soon and you need one, email me and I will try get it posted.
Ari
10/10/2005 (5:42 pm)
Well, I don't want to post the contract template (yet) but here is what we have decided at BrokeAss Games.Most game companies contract developers for hire.
We are a group building an MMORPGFPS (please, no comments) that has very limited funding.
So we are not able to pay our developers currently.
We are building the game for the love of it, but it is becoming apparent that completion is actually possible.
So we needed a business solution different from the norm.
What we are doing is creating milestone contracts that have a due date and a list of tasks.
Then we negotiate the monetary value of the contract and rate it at 4 times the amount.
If and when our company breaks a certain monetary value ($100K just to give an idea), the contracts will be able to be collected on.
When one milestone contract is complete another is negotiated.
This allows a typical "build my super kewl MMORPG for free" company to operate.
75% or more of the company's income will be kept with the company, this is what the overhead and contracts are paid from.
The original founders of the team have a tiny percentage added to their milestone contracts that allow them to earn pieces of the company's profits (up to a point).
Basically, IF the company succeeds, a developer can present his stack of milestone contracts and collect money for his/her work.
It also provides incentive for the developers to complete tasks on time (or earlier) so that they can go on to the next.
We also have a volunteer contract for people who want to donate a small piece of their time/work for a spot in the credits.
After spending 2 years on this game project, I was worried about recruiting slackers who wanted a piece of the company but weren't going to put in the work.
This is my solution and everyone on the team has agreed that this is fair.
I hope this helps any indie teams that have limited or no funding.
If I don't post a contract template soon and you need one, email me and I will try get it posted.
Ari
#3
The primary concern is that these contracts can build up rather fast. Looking at your profile, you have at least 7 people in the team. It is quite possible that your first game project won't succeed as well as you hope. Considering that a milestone could have the value of $50-$1000+, and then multiply that by 4, and should each member complete at least 5 milestones by the time the company's value (and that not being income on-hand), it could get ugly for everyone.
1 Milestone=$400
$400x4=$1600
$1600x5=$8000
$8000x7=$56000
Those figures are purely fictional, of course, but you can see how it can jump. I'm only going by an artist's figures, where if an asset completed by an artist could value $80 (depending on the asset, but I'm figuring on a fully modeled and textured character model at the least), and there's at least five assets to be completed in one milestone. Your team members are probably a little more on the modest side if they're working free for starters, so the value could be less. Obviously, I have no clue what programmers, mappers, etc would get :P
I don't really know what you mean by "If and when our company breaks a certain monetary value". You'll probably be sucked into a ton of legalities and paperwork before you find out how much the company is worth. Anyways, looking from the perspective I mentioned before, your company needs to be worth at least $56k, though that doesn't mean that can all be paid up right then. More than likely, by the time your company reaches that worth, everyone will have finished the first game, maybe even a second or third game depending on the success of the first one. More milestone contracts start building up during that time, the token system starts getting choked, and people could get discouraged.
Bah, I'm just rambling now, but that's one worst-case scenario a person who doesn't know much about what he's talking about can come up with. Before you decide on that system, you should take it easy and tell the impatient ones to be patient. Rushing contracts produces regrets. Deliberate over other options. I know you're also releasing this for the good of the community, perhaps more experienced members can offer some public input?
I can't say I would have come up with a different system though, I'll admit. The percentage-based deal is more secure on the whole, since payment depends on the success of the game or company.
There is one system that comes to mind, which may be a better solution. Turn your company into an official company/corporation with shares. Sell shares in return for the work/assets provided. This is very similar to promising percentages, since the individual profits in the same ratio as the corporation with the shares, but it gives more security and the individual can sell their shares for cash as well.
Of course, I think you need investors...but if you have a game that will "make it", it shouldn't be too hard to find them (though judging from others' experiences, don't get overwhelmed :P). I know little about corporations and shares, so if it sound nice to you, research it first :P
Oh, and if anyone else finds what I said to be incorrect or disagreeable, please say so outloud, if only to help push people in the right direction.
10/10/2005 (9:48 pm)
Your last post is just vague enough so that what I say may not have any worth :P. I'm not an expert on contracts or anything, by all means. But if you'd like to hear a comment or two from me, keep reading by all means.The primary concern is that these contracts can build up rather fast. Looking at your profile, you have at least 7 people in the team. It is quite possible that your first game project won't succeed as well as you hope. Considering that a milestone could have the value of $50-$1000+, and then multiply that by 4, and should each member complete at least 5 milestones by the time the company's value (and that not being income on-hand), it could get ugly for everyone.
1 Milestone=$400
$400x4=$1600
$1600x5=$8000
$8000x7=$56000
Those figures are purely fictional, of course, but you can see how it can jump. I'm only going by an artist's figures, where if an asset completed by an artist could value $80 (depending on the asset, but I'm figuring on a fully modeled and textured character model at the least), and there's at least five assets to be completed in one milestone. Your team members are probably a little more on the modest side if they're working free for starters, so the value could be less. Obviously, I have no clue what programmers, mappers, etc would get :P
I don't really know what you mean by "If and when our company breaks a certain monetary value". You'll probably be sucked into a ton of legalities and paperwork before you find out how much the company is worth. Anyways, looking from the perspective I mentioned before, your company needs to be worth at least $56k, though that doesn't mean that can all be paid up right then. More than likely, by the time your company reaches that worth, everyone will have finished the first game, maybe even a second or third game depending on the success of the first one. More milestone contracts start building up during that time, the token system starts getting choked, and people could get discouraged.
Bah, I'm just rambling now, but that's one worst-case scenario a person who doesn't know much about what he's talking about can come up with. Before you decide on that system, you should take it easy and tell the impatient ones to be patient. Rushing contracts produces regrets. Deliberate over other options. I know you're also releasing this for the good of the community, perhaps more experienced members can offer some public input?
I can't say I would have come up with a different system though, I'll admit. The percentage-based deal is more secure on the whole, since payment depends on the success of the game or company.
There is one system that comes to mind, which may be a better solution. Turn your company into an official company/corporation with shares. Sell shares in return for the work/assets provided. This is very similar to promising percentages, since the individual profits in the same ratio as the corporation with the shares, but it gives more security and the individual can sell their shares for cash as well.
Of course, I think you need investors...but if you have a game that will "make it", it shouldn't be too hard to find them (though judging from others' experiences, don't get overwhelmed :P). I know little about corporations and shares, so if it sound nice to you, research it first :P
Oh, and if anyone else finds what I said to be incorrect or disagreeable, please say so outloud, if only to help push people in the right direction.
#4
10/10/2005 (10:53 pm)
Besides the corporation (work for shares) model, the volunteer model and the one above, what else are my options?
#5
Summary of the contract- Basically, a promise to have everyone's work evaluated by a professional/expert when the game goes out and profits come in.
The promise is a contract in itself, in which once the company receives the fruits of the team's labor, the expert is hired a certain period of time later to determine the value of the assets produced by each member. Also determined may be a percentage of the profits instead of cash for payment. The team member then gets paid the agreed amount or form.
This would make it a long term contract with a promise of security at the end, relative to how much was done for the game.
Since the only way the contract can be breeched is by not having the expert hired within that period of time, certain terms of the contract that support the contractee like being applicable for lawsuits, etc should be in effect, since the assets would have already been used and distributed and made money off of by the time the contract really comes into play. Realistically, a person can't worry about getting ripped off in the end since there's not really any way for a person to get away with taking all the profits and leaving everyone out (which I'm sure you wouldn't do, but you know how it goes :P). That should be enough to qualm any of the new members' fears.
Oh, and the expert would have to be agreed upon beforehand by both parties, obviously. Perhaps GarageGames or some other (a publisher perhaps) could be hired to do the analysis.
Sounds a little fickle, but a promise is really what it's all about no matter how you look at it.
10/10/2005 (11:22 pm)
Personally, this is what I would probably do in your situation:Summary of the contract- Basically, a promise to have everyone's work evaluated by a professional/expert when the game goes out and profits come in.
The promise is a contract in itself, in which once the company receives the fruits of the team's labor, the expert is hired a certain period of time later to determine the value of the assets produced by each member. Also determined may be a percentage of the profits instead of cash for payment. The team member then gets paid the agreed amount or form.
This would make it a long term contract with a promise of security at the end, relative to how much was done for the game.
Since the only way the contract can be breeched is by not having the expert hired within that period of time, certain terms of the contract that support the contractee like being applicable for lawsuits, etc should be in effect, since the assets would have already been used and distributed and made money off of by the time the contract really comes into play. Realistically, a person can't worry about getting ripped off in the end since there's not really any way for a person to get away with taking all the profits and leaving everyone out (which I'm sure you wouldn't do, but you know how it goes :P). That should be enough to qualm any of the new members' fears.
Oh, and the expert would have to be agreed upon beforehand by both parties, obviously. Perhaps GarageGames or some other (a publisher perhaps) could be hired to do the analysis.
Sounds a little fickle, but a promise is really what it's all about no matter how you look at it.
#6
Our project is managed privately on iTeamwork.
Ari
BrokeAss Games
10/10/2005 (11:24 pm)
@Raxx: Heheh, don't let the plan here fool you, it's horribly out of date and no longer used.Our project is managed privately on iTeamwork.
Ari
BrokeAss Games
#7
Thank you for the feedback, you bring up some very valid points.
The last solution (bringing in an expert) seems more of a clean up solution, but it allows the focus to be on game production and save the business part of things till the end (which would be more enjoyable).
This is not the road I want to or can travel.
However, I will run it by the more experienced people from the public sector gambling industry that guide me.
I'm sorry for being so vague in my original posts.
Just to be clear, I am not in the startup phase, my new team was formed to complete the deployment of a previously created solution, not create one from scratch.
So the solution I suggested at the beginning of this post may not actually suit a newly starting indie company.
To my understanding, you have suggested the models for a newly starting company.
And they make complete sense!
Had I to do it over again, I would have chosen the corporation but both models that you have suggested would work very well.
After looking at your profile, I think that you may understand my position more.
Our original team failed and so I started over from scratch and built until I had a complete engine (if one ever is), a feature demo, enough resources to outfit a crew of developers and the tools to manage them.
It took me over a year and several thousand dollars, and I was working alone for nearly all of it.
Recently, I needed a team to help me complete it.
With the current assets and progress I have allready, attracting a team (some of which were on the original failed team) was not a problem.
Not being able to pay them up front was. :/
They are willing to help me finish the project for promised monies on the basis that we actually "make it" and clear a certain amount net profits (NOT company value, liquidating the company to pay it's contracts would be suicide, unless I am not understanding the "hired expert" model and the company is invested into, sold or takes out loans dependant on it's total value).
It does require some very careful managing in the model I'm using, but it in my position, it's seem the only possibility.
I don't feel that I should start over because of the time and money that has allready been put in.
You have given me food for thought.
The percentage idea does work well for a scenario that may happen to us (LOL, if I get hit by a bus!), failure.
At this point, we would destroy our business model, take the standard indie route and sell content packs and smaller games with the existing resources we have.
Giving every developer a small percentage would allow them to still have the chance of collecting for their work even if the company never reached it's first net profit goal.
I guess the topic should have been, Indie Business Models.
Thanks for all the input, you have given me a couple of points that need serious consideration.
Here is a thread that may help you understand my original position more if you are interested.
Ari
BrokeAss Games
10/11/2005 (1:45 am)
@RaxxThank you for the feedback, you bring up some very valid points.
The last solution (bringing in an expert) seems more of a clean up solution, but it allows the focus to be on game production and save the business part of things till the end (which would be more enjoyable).
This is not the road I want to or can travel.
However, I will run it by the more experienced people from the public sector gambling industry that guide me.
I'm sorry for being so vague in my original posts.
Just to be clear, I am not in the startup phase, my new team was formed to complete the deployment of a previously created solution, not create one from scratch.
So the solution I suggested at the beginning of this post may not actually suit a newly starting indie company.
To my understanding, you have suggested the models for a newly starting company.
And they make complete sense!
Had I to do it over again, I would have chosen the corporation but both models that you have suggested would work very well.
After looking at your profile, I think that you may understand my position more.
Our original team failed and so I started over from scratch and built until I had a complete engine (if one ever is), a feature demo, enough resources to outfit a crew of developers and the tools to manage them.
It took me over a year and several thousand dollars, and I was working alone for nearly all of it.
Recently, I needed a team to help me complete it.
With the current assets and progress I have allready, attracting a team (some of which were on the original failed team) was not a problem.
Not being able to pay them up front was. :/
They are willing to help me finish the project for promised monies on the basis that we actually "make it" and clear a certain amount net profits (NOT company value, liquidating the company to pay it's contracts would be suicide, unless I am not understanding the "hired expert" model and the company is invested into, sold or takes out loans dependant on it's total value).
It does require some very careful managing in the model I'm using, but it in my position, it's seem the only possibility.
I don't feel that I should start over because of the time and money that has allready been put in.
You have given me food for thought.
The percentage idea does work well for a scenario that may happen to us (LOL, if I get hit by a bus!), failure.
At this point, we would destroy our business model, take the standard indie route and sell content packs and smaller games with the existing resources we have.
Giving every developer a small percentage would allow them to still have the chance of collecting for their work even if the company never reached it's first net profit goal.
I guess the topic should have been, Indie Business Models.
Thanks for all the input, you have given me a couple of points that need serious consideration.
Here is a thread that may help you understand my original position more if you are interested.
Ari
BrokeAss Games
#8
http://www.brokeassgames.com/images/screenshot_019-00004.jpg
This is by far your best looking screenshot, have you considered developing a tank combat game?
01/25/2006 (7:11 pm)
Just a small comment and sorry it's not about your topic.http://www.brokeassgames.com/images/screenshot_019-00004.jpg
This is by far your best looking screenshot, have you considered developing a tank combat game?
#9
http://www.brokeassgames.com/images/screenshot_019-00004.jpg
This is by far your best looking screenshot, have you considered developing a tank combat game?
01/25/2006 (7:12 pm)
Just a small comment and sorry it's not about your topic.http://www.brokeassgames.com/images/screenshot_019-00004.jpg
This is by far your best looking screenshot, have you considered developing a tank combat game?
Torque Owner BrokeAss Games
BrokeAss Games
It either has to be free or a commercial company.
It doesn't seem that a mix will work.
I'm just worried about making it fair (I have 2 years of solid work in and some of the team members have under 100 hours).
The contract still intertests me for the indie community anyway.
I have never seen a contract for a free or "sweat equity" project.
If I find a solution, I will post it here.
Ari