Now the largest independent developer in North America, Foundation 9 is well prepared for the transition to the next generation. By focusing on creating IP, not just games, the company is able to market its properties to other media besides interactive entertainment. In an exclusive interview, we speak with F9E CEO Jon Goldman about his company's business strategy.
There's no doubt that the impending console transition will be tough on some developers; video game budgets, which are already quite high, will consistently approach the $10-$20 million range. In order to stay on top of the game, independent developers will need to have a solid business strategy. One such strategy is to create and obtain a library of intellectual property that can be marketed to other industries in addition to being used for the development of games. Formed in April 2005, Foundation 9 Entertainment (F9E) has subscribed to this strategy and is now the largest independent developer in North America.
F9E develops properties for multiple media and merchandising opportunities, including video games for all platforms, comic books, film and television series, action figures and more. The company's five core brands include The Collective (Star Wars Episode III: Revenge of the Sith), Backbone Entertainment (Death Jr.), Pipeworks (Godzilla: Destroy All Monsters), ImaginEngine (World Poker Championship, Dora the Explorer: Fairytale Adventure ), and Digital Eclipse (Midway Arcade Treasures 1 & 2, Atari Anthology).
GameDAILY BIZ recently spoke with Foundation 9 CEO Jon Goldman about their approach to the market and the transition to next-gen.
"Our goal is to participate as more of a cross-media company that takes IP to interactive, traditional media and consumer products markets, but we're also continuing to do a lot of game development with publishers. There will probably never be a day when we turn down opportunities like Star Wars or even Dirty Harry," said Goldman.
He went on to explain that part of the reason Backbone and The Collective merged to start F9E was precisely to be able to handle the transition to next-gen: "Part of coming together to create a large company was to create the resource base that allows us to tackle that transition, to invest financially in it, to have the right number of individuals to put on teams; and so that kind of size and scale is absolutely critical on all fronts. Right now we've got a lot of future positions. We're looking forward to continue to grow the company to meet the needs of larger scale games."
F9E has been able to grow its core through acquisitions, and although Goldman would not specify, the acquisition hunt could continue in the near future. "If there are good opportunities out there, we'll definitely be taking a look," he said.
Bringing games to Hollywood and vice versa
Foundation 9 also has the added advantage of having a minority stake in Circle of Confusion, the production management company that represents directors, screenwriters, novelists and comic book creators—they worked with the Wachowski brothers on The Matrix trilogy. This gives F9E the insider access it needs in order to bring its properties to Hollywood, or to bring Hollywood properties to the interactive entertainment arena.
"It works both ways," Goldman explained. "We're working with Hollywood creators early in the process to make sure ideas they're working on as well make sense for the game industry and not just when it's too late to license to publishers. So we think that's an exciting opportunity, not just for us, but also for publishers who would ordinarily miss out potentially on exciting licenses... we'll get busy with it a little bit earlier in the development so it has some care put into it."
Pull vs. Push
Goldman made it clear, however, that F9E doesn't aggressively push IP on companies; rather, they try to forge relationships that will automatically draw people to want to work with the IP. "Instead of us saying, 'This is going to be the next big thing,' we try to put together a set of relationships such as Circle of Confusion, such as our consumer products partners, where when we see a bunch of different groups getting behind something... the property naturally gets pulled forth by an early audience," he said.
"In the case of Death Jr., it started with an enthusiastic group at Comic-Con and then building up the comic book; that's part of our strategy, to create what we're calling 'authentic marketing' for a project by getting other relevant products, other toes in the water in other media and seeing if there's actual consumer interest and then at that point we'll pour more resources into it. And I think that's different from organizations that are trying to make picks or make bets... The next things we'll put money on are the things consumers respond to, not things that just happen to be our favorite flavor of the moment," Goldman explained.
Although Backbone's Death Jr. could have fared a bit better critically, we were told that sales were "ahead of projections" to date, and from an IP standpoint F9E considers it quite successful—and that's all that really matters.
"If you look at it more as an IP franchise as opposed to a PSP game, we've got a very successful comic book that's gone into reprint, it's going to be put into a graphic novelization, we've got collectible toys coming out, we've got apparel and sometime later in the fall we'll have body jewelry. In the meantime, there'll be more Death Jr. games coming out," Goldman said.
Looking ahead, F9E's The Collective is currently developing a game based on the Dirty Harry film franchise for next-gen consoles. F9E is also working on some as yet unannounced next-gen opportunities at its Vancouver studio.