A New Paradigm in Employee Compensation

David Edery is a buddy of mine who I think you guys are really going to love. Dave is one of the co-founders he’s the CEO of Spry Fox, which is a unique game development studio here. They’re  based here in Seattle, but they have people spread out. They made Alphabear, Steambirds, Triple Town, and Realm of the Mad God.

These are games that all together have 50 to a hundred million people playing them worldwide. Dave is a very successful game developer making really delightful games. They’re trying to make the world a happier place. You should definitely play their games on your phone. Dave used to work at Microsoft and and he wrote a book about transforming business with what can be learned from video games. The book is called Changing the Game. I think even now a lot of those lessons can be super relevant.

I think of games as like the future of almost every industry. Video games are an industry where there’s a lot of competitive dynamics. Unlike almost everything else, no one’s paying you to play a game. If you get bored, you’ll quit. And nobody wants to read a manual to play a game or take a class to play a game.

So the games have to teach you how to interact with them. And there’s so many things that can be done with video games. I’ve seen so many other industries learn from games. We also talk about the capacity of games to be used for education and learning.

I’m really interested in that topic and have thought a lot about it over the years. Dave is a guy that you would want to talk to about that. He also has a really unique culture in his company that he’s tried to create. As well as a really unique view of developing culture in online communities. He has a lot of experience with this.

I think anybody in the game industry knows Dave by now because he’s also involved in creating a community out of game developers. There’s a lot to learn here and I’m hoping that you guys really enjoy this episode.

Pablos: I have a zillion questions for you. This is going to be fun for me. At this point, you had a super interesting and maybe not extremely long but long career in building video game companies. Video games are the glue or something that connects a whole bunch of people to computers, computation, coding and all this stuff. People don’t realize how responsible they are for scaling the interest in personal computers. That’s important because it attracted a lot of people, money, investment and even things we take for granted, especially like the obvious ones like GPU’s are almost entirely made possible by the demand from the video game industry.

To some extent, ramping up the scale, reducing costs on hardware, all the things that exist in the CAD industry, for example, for making 3D models and designing stuff on computers, that industry can pay $10,000 or $20,000 for a workstation that’s top of the line and super-fast to render models. They don’t have economies of scale. They’re never going to get the custom hardware they would want. They’re never going to get the price down to the point where a lot of people could use it, but video games did that for everybody. The industry itself is the first entertainment-related industry that got computers connected up to real people.

David: I don’t think it’s a coincidence that when you look at systems that are being put in place to teach kids how to program, a lot of them have a big focus on, “You can make a game this way.”

Even when I was a kid, we didn’t quite have video games or the ability to make them, but we had things like logos, which was like, “You can make this thing move on screen like a video game.” It’s trying to make it accessible. Now that is how kids learn. The starter drug for coding is Minecraft mods or making a game from scratch. It’s an important part of the history of personal computers. You probably know better than me, but my understanding is that the scale of the video game industry is bigger than movies, TV, music and books combined.

They include hardware sales in that. I’m pretty sure that includes the sales of the console themselves and stuff, but still it’s a lot.

You wouldn’t count the cost of your television and the cost of the TV industry.

We’re not including that either. We’re all sharing the TV. They’re including the stats for the Xbox and the PS4. Even if you take that stuff out at this point, I don’t know for sure, but I wouldn’t be surprised if we’re beating movie revenue even with the hardware taken out.

That seems pretty easy to substantiate. It’s a massive industry and super influential, and has gotten past high school nerds.

Something like 99% of kids under the age of eighteen play games.

A lot of middle American housewives.

They don’t count themselves as gamers, but then you ask them, “Have you ever played Candy Crush?” They’d be like, “I play it all the time.” There you go.

Apparently, that’s a significant market too, casual games, all the PopCap stuff.

Unfortunately, PopCap is not a big player anymore, but there are various Saga S games. It’s a huge market.

Maybe another way of thinking about is like who’s least likely to be interested in any video games?

The least likely will be someone like the elderly. The older you are, the less likely you are, to some extent. There are plenty of older people who are playing solitaire or whatever, it’s how they pass the time. Even for them, it’s an unfair generalization. First of all, people who didn’t grow up with games tend to be less interested. It’s not a thing. They’re like, “This game thing, what’s that?” That’s a stereotype, but that applies to a bunch of people.

Additionally, even if you did grow up with games, and this is funny, it’s even happening to me. I loved the damn things. As people get busy with work, children and stuff like that, they start to be like, “I don’t have time for this.” They’ll push most games aside. What’s interesting is they don’t push them all aside. They’ll still have that one game on their phone that they pull out of their pocket when they’re stuck in a line.

It’s different contexts. The point I was trying to get my head around the industry because there’s a lot of other industries related to computers that are not nearly as fun, accessible, compelling or something to people in general, but video games are the biggest that go everywhere. It’d be interesting to know how you found your way into this industry.

I grew up playing games. I loved them.

Your parents didn’t suggest, “You should be a doctor, a lawyer or a video game developer.”

I got into medical school and then decided not to go and break my dad’s heart.

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People who didn't grow up with games tend to be less interested.
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You have parents that want you to be a doctor. Why is that? My parents aren’t doctors and they didn’t specifically try to get me to be a doctor. I have no interest in it whatsoever. The doctors I know are some of the most abused people on earth. I don’t know why anybody would want that job, but people who have it seemed all want their kids to be doctors. What’s going on there?

I can’t speak to anyone else’s experience. For mine, it was very simple. My dad has this very strong belief that is based in part from growing up without very much. He used to say it all the time. He’d say, “They can’t take away your degree.” Doctors will always make money. They will always be in demand. He would hammer that into me over and over again.

You grew up at a time where employment options were slammed and you had to dedicate yourself to being employable.

Bear in mind, he didn’t grow up in the United States. He grew up in Colombia, South America so even more so.

It’s a higher reliability career.

Shortly after graduating from medical school, there was a requirement at the time that you would have to travel around the country doing national service. He has stories of like, “I was riding a donkey to this isolated town or whatever.” He would tell me. He’d be like, “Everyone is happy to see the doctor.” You’d have instant respect anywhere you go. For him, it’s like a thing. It’s like guaranteed respect, guaranteed money. Why wouldn’t you do it? It’s the right career path. It makes sense for someone who grew up without the resources he was hoping for. The thing that all good immigrants do like, “I grew up with nothing and now look at everything I’m going to give you. You’re going to give your kids even more, but you’ll have to be a surgeon to do that” or whatever.

I’m not trying to get my kid anything. She takes more than she deserves. You ended up getting into medical school. Why?

I’d only ever been doing it because I hadn’t ever thought it through. This medical school program was very interesting. I got in early without having to do all the requirements at Mount Sinai. One of the requirements that you do instead of taking whatever course I was able to skip is, “You have to spend eight weeks with us over the summer and shadow people in the hospital.” It sounds awesome. I went and did that.

The first time I saw a substantial amount of blood, I fainted. They were like, “Don’t worry. That happens a lot. It’s normal.” A few days later, I saw a substantial more amount of blood, I fainted again. They’re like, “It’s not that normal for fainting twice.” I wasn’t particularly enjoying any of this either, it wasn’t just the fainting. I thought, “That’s okay.” I was always interested in psychiatry. I thought, “That’s going to be the thing that will save me. There’s no blood in psychiatry. It’s a doctor who still needs an MD. I’m not going to be seeing a lot of blood as a psychiatrist. It’s going to be fine.”

I spent a week in the psych ward and it was the most depressing week of my entire life. It was horrible. I had a lot of pity for them. That was part of the problem. I had this tremendous empathy for the people who I was seeing there. All the people who were treating them were horrifically jaded. I understand now, as a mature adult, you have to be on some level because the people you’re treating many of them will almost certainly never get substantially better in that context.

At the time, I didn’t know that. All I knew is that this one thing that was the saving grace for me for medical school seemed horrible. I was like, “This is not for me.” I always wanted to be an entrepreneur on some level. The dot-com boom was happening then. All my friends were talking about the startups they were going to make. It seems so exciting. I love computers. The heck with this medical school stuff. I’m going to go teach myself programming and do that. That’s what I did.

This is a total aside. One of the things you said about the jaded people working in a psych ward, the patients, lots of them will not likely to get substantially better, empathy not being a functional cure for whatever else then. I wonder if that’s true in other contexts too. Maybe they’re not in a psych ward, but people in general, in daily life, a lot of the time feels like they’re not going to substantially improve. You have to temper how much effort you put into them. Do you ever feel that way as a professional nice guy?

It’s hard. My personality is such that I’m willing to bang my head against a problem for longer than I probably should. I’m generally not willing to give up, but if you’re running a company for long enough, sometimes you learn that you have to. Whether it’s on a project or an employee who’s not working out or whatever. Sometimes it’s like, “I’ve spent two years trying to make this work. It’s not working, I got to cut and run.” I do think about it a lot. This is one of the reasons why I like games. When you think about what a game has the capacity to do. A game has the capacity to chip away at someone for thousands of hours if they’re willing to give it that much time. This is perfect.

It is trying to teach you and it’s ultimately patient.

Think about what you can accomplish. That one of the reasons I got excited about games in the first place was the realization that imagine there’s a person who’s bad at X but they like your game. That’s cool. They might be willing to spend 1,000 hours getting better at X, whatever X is.

That’s one of the things I think about a lot. We often are fixated on a lot of things with robots right now. Robots are amazing because you teach one robot something and they all learn for free. With humans, you got to start over from scratch with every single one of them. You teach them something, you’ve accomplished nothing that scales. You have to start from scratch and teach the next one. It is work every time.

The problem with education is nothing about it scale. The video games to me are these extraordinary optimized learning environments. A video game has got to assess where you’re at, put a challenge right in front of you. If it’s too hard, you get bored and quit. If it’s too easy, I get bored and quit. Nobody’s paying me to play video games. Nobody’s paying my kid to play video games, but yet they do it all the time and people do it all the time. That’s what a good teacher would do. If you could afford to have a one-to-one student-teacher ratio, your teacher would understand your level where you’re at, what your interests are, and know how to put a challenge right in front of you. It’s not too easy, not too hard.

The games are doing that. People disparage video games all the time, but they don’t realize that these are optimized learning environments. They’re outperforming schools, all of them. My kid would go to school for six hours, come home bored having learned nothing. She plays video games on her iPad for 45 minutes and learn a ton. It’s mostly stuff we don’t care about for learning, but it’s a learning environment that is compelling.

It’s funny when you were talking about how teachers aren’t scalable. Another thing that’s typically considered highly not scalable is therapy. Therapy is a one-on-one like you and a $200 an hour therapist or whatever it costs, going back and forth for years until you are a slightly happier and better person. Talk about something that’s super not scalable. I was watching a webinar. I have a guy I know in Boston. He’s created a company called Mightier. They’re creating games that will help children with emotional self-regulation. I was particularly interested because my daughter has mild anxiety issues, nothing like crazy, but enough so that we take her to therapy because we want to help her with this.

When I found out that this guy I know had created a suite of games that are designed to help kids with anxiety, I was like, “I have to check this out.” We haven’t gotten it. I’ve only watched the webinar. I should be receiving my package soon, but they had one thing that was clearly a knockoff of Fruit Ninja. The way it was working is there was fruit falling down from the sky and the kid had to cut it. As they’re playing, the kid is wearing a watch or something that’s measuring their heart rate.

If their heart rate goes up because they’re getting excited about the game and the game is getting more intense, the game purposely starts to obscure the screen so that it’s even harder than it already would have been to play. This is a feedback thing and your heart is getting up even faster. The obscuring of the screen is linked to your heart rate. At some point, you can’t even see the screen. You have to tap the thing and say, “Stop.” It prompts you to use deep breathing exercises to lower your heart rate. Once you do, the screen obscurity stops and you can go back to playing it. I thought that was such a cool idea.

I’m excited to try it with Arian, which we haven’t had a chance to try it yet. It’s a perfect example. I don’t know if this will work. It’s based on research that came out of Harvard. It’s got sound research backing, but assuming that it works, imagine with a piece of relatively inexpensive hardware and a set of digital games that can be distributed for free to any iPad, all of a sudden you have a way to help millions upon millions of kids with emotional self-regulation. What’s that worth? It’s pretty cool.

I’m thrilled about that. It is interesting to see the way because we all have mobile smartphones and these kinds of things, and apps are relatively inexpensive to make and distribute. Lots of things like that that people are doing to try and better themselves. There’s work to do to take the best in class, understanding of game mechanics, gamification, and then cross-pollinate that with the problems like anxiety or things that you’re trying to solve for. A lot of times you end up with a mediocre game and a mediocre solution to your problem, which I think of is educational games in the ‘80s.

There were awesome games and then you had mediocre games that would teach you stuff. The second kids figure out you’re trying to teach them something, they’re out of there. For an adult or someone who knows like, “I’m trying to reduce my anxiety. I’m going to do this thing and sign up for Headspace or whatever.” That will work, bur with kids, I always thought what we ought to be doing is burying the things we want kids to learn into awesome video games.

A friend of mine years ago had made the first Medal of Honor or Call of Duty, which I don’t remember which one came first. He would go visit battlefields. He would interview veterans of these wars. The whole game was historically accurate, all the guns, all the characters, all the locations. People thought they were just running around shooting stuff, but they were actually learning war history. We have this entire generation of people who grew up playing those games. They don’t even know that they know a lot about these wars. You could debate the merits of learning war history. Those games were no compromise.

Civilization is the one that people most often bring up. You’ve played that.

No, I’m a big fan but I don’t play any games.

You’re going to have to play Civilization because it’s one of the greatest strategy games of all time. It’s a storied franchise. It existed since I was a kid. People oftentimes will bring that one up in the context of a discussion about exactly what you were describing. These games that are awesome and happen to teach you something. Civilization was all about advancing your civilization from pre-wheel technology all the way to traveling to space. Unlike SimCity, this is a competition. There are other civilizations and you’re either going to have diplomacy and succeed that way, or war and succeed that way. You can have to try it one way or the other, or you can succeed by being the first people to reach the stars since one of the conditions in the game.

There are multiple different ways. One of the ways is researching new technology, whether it’s the wheel, tanks or whatever. Civilization does this wonderful thing where first of all, it’s highly fictionalized. Yes, the wheel came before this thing, which came before this or whatever. It’s presenting to the scientific developments in an accurate order. Second of all, it has all this information about those developments, but it doesn’t force you to read them.

When you develop the wheel, it’s like, “Here’s all this information about the wheel and why it was such an amazing thing. You can read it if you want to. You don’t have to if you don’t want to. It’s there. Tons of kids goes into reading that stuff and end up developing an interest in history as a result. It’s in science and a bunch of other things. This comes up over and over again. It’s considered one of the primary case studies for how you could do an educational game correctly.

To me, it seems there’s another aspect of it. Aside from the educational aspect of it, in the lab where I was working, we did a bunch of computational modeling and the primary thing we were doing or one of the biggest projects was trying to model the spread of disease. You have the same thing as SimCity or I don’t know about Civilization, it’s probably the same thing. You have a model of a city and you can try different things. You could figure out which things make the city work better and which things cause it to spiral down into endless doom. We’re doing the same thing, but for the real world and trying to figure out which things can we do to end the spread of a disease. Fundamentally, they are not much different from each other.

What’s happened over the course of our lives, our computers got faster and more powerful with more memory and more capable, and now we can run ever more complicated models. The point being is you have a model where you get to run experiments in a way that’s safe because if they fail, nobody dies. In the real world, we’re always running one big experiment where people die because we got it wrong. One of the amazing things is we’re at this point now where we’re not nearly so computationally constrained. For our whole lives, the models were always super limited because of how expensive computation was and the availability of it.

Now we’ve got more computation than we know what to do with it. It’s allowing us to make these ever more complex models of the real world and run all those experiments in them. You could easily imagine, for example, the future of a real city would be a computational model. It’s like SimCity. We’re in Seattle. You should have a SimCity of the actual Seattle. You should be able to run a bunch of experiments. They were like, “What would improve traffic? What would improve reducing homeless populations? What would improve shortening the line of Starbucks? What would improve parking?” All those kinds of things could be tested in a computational model before you make a choice about what to do in the real world. That’s not happening right now because you can see the kinds of problems that we have or a lot of them would be easy to fix that way.

It’s inevitable and in some sense, imminent that we’ll get those tools. All of it goes back to video games. We’ve been doing all that in video games forever. Video games are impressions about the future of almost every industry. They’ve been at the forefront of adopting these technologies, putting them to use. You look at the progression of 3D rendering, trying to make photo-realistic imagery. The whole world got to watch this play out through Pixar movies. Toy Story was specifically a story designed to keep from ever having to show a person because rendering skin and the luminosity of skin was so hard. Rendering hair was hard.

As the years progressed, they started doing things like Monsters Inc., where they’re showing off how good they could do at rendering hair. It’s like, “Our main character is Fuzzy,” because pics are showing off like, “See, we do hair now.” It was a hair movie. There’s the Asian hair movie based on a video game. I’m not sure which one that was, Shrek and those things. We’ve long since solved hair. We’ve long since solved this luminosity of the skin. We can do all of those things. It’s the exact same thing we’ve been doing in video games. It just had to advance to the point where we could do it all.

There are a lot of things that games do that have been doing for a lot longer than anyone else realized like, for example, there’s all this conversation nowadays about toxicity and online communities, and how do you solve for that? Games have had to be worried about this and solving for it for decades. They’re way ahead of the curve, which nobody knows or at least decision-makers don’t know. That’s changing as decision-makers become more people from our generation.

People ask me about those things. I think of it as a maturation process. I got an email in 1982. I’ve been chatting online since the ‘80s. At first, it takes over your life, but you build an immunity. You learn to figure out like any other addiction, how much of it is making my life better, and how much it was making my life worse?” You learn to balance that. Some people fail to learn to balance and that’s where you end up with real problems. Most people do learn to balance. I got in Instagram. I lost two weeks of my life to that. I got it under control. Now it’s not an addiction or something that eats up my life anymore. Some people overdo it. Some people don’t engage because they know they’re addictive, things like that.

There’s this real societal mechanism that kicks in where everybody wants to blame somebody else. We want to blame Instagram for taking over our lives. You don’t have to use Instagram. You want to blame Facebook for electing the wrong people. You don’t have to use Facebook or at least not so much. The more you’ve been through those cycles of getting a new whizzbang thing that takes over developing the immunity, the more you have confidence, that’s normal and can be done. A lot of video games are a cesspool for bad behavior. There do seem to be interesting cases where the community in the game develops their own set of values and their own enforcement mechanisms. They’re little societies.

In some cases, they’re gigantic societies, millions and millions of people participating in them. It’s like anything else. It turns out that culture is a powerful and sticky thing. People tend to underestimate how hard it is to change a culture once it has calcified into a given form. Good game developers understand that if they want their game community to have a good culture, a culture that will be welcoming to new entrance and generally non-toxic that you have to be vigilant from the very beginning. For example, we have an MMO that we’re working on. Because it’s still in development, it hasn’t been released publicly yet. It’s got a relatively small community of about 1,500 people in Discord, which is one of the big gaming online communities nowadays.

We’ve been super clear with them from the very beginning that we have zero tolerance for any particularly toxic behaviors, anything like racist or sexist speech, but even being rude to someone we don’t tolerate. We’ll just warn you, “You’re being rude, keep it up and you’re going to get banned.” The fact that we’re doing that from the very beginning means that we don’t have the problem that many other game communities have, where nobody bothered to try to enforce that until the community had been behaving that way for months, if not years. At that point, they were like, “Screw you. This is who we are. This is how we function. This is how we talk to each other. Who are you to tell us that we can’t?”

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Some people fail to learn to balance, and that's where you end up with real problems.
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We get in from the very beginning and we tell them that. Not just that, where it gets more interesting particularly in the game space is we try to build games that will also function that way. In other words, in our MMO, we have tried to remove all the mechanics that encourage toxic behavior. We’ve been very thoughtful about this. I’ll give you a few examples. In other games, you might have this concept of kill stealing, which is a thing where like, we’re both fighting the same monster. I get the final shot that kills it. I get all the experience points and you get none, even though you did 80% of the work killing it. You did a kill steal. That sucks. That’s ridiculous. That’s a terrible mechanic. All that does is cause two people who should have been happy that they were helping each other, now they hate each other. It’s terrible. In our game, it doesn’t matter. If you do 99% of the damage and I do 1% of the damage, we both get exactly the same amount of experience and it’s the maximum amount possible.

I’m never angry that you were there. Even if you did nothing, you didn’t hurt me. It would have been nice if you had helped, but you didn’t hurt me. There’s no kill stealing. There’s no like, “I did 99% of the work and then you screwed me at the very end.” That seems like an obvious thing when you talk about it. Every game should be that way. In a lot of games, kill stealing is a real thing. We don’t let it be a thing in our game and I could go on and on, but I don’t want to bore you.

I’m interested in this. I don’t know about these problems. I haven’t thought this through the way you have. Is that like a participation award? I show up while you do all the work and kill the thing. I’m like, “I got all the points too,” because I’m not contributing.

The answer is yes and no. Yes, it could be but it turns out, no one joins a game to sit there and do nothing.

They seemed to do it in real life. That’s why I’m asking.

That’s the thing. In the games, they don’t. The games are there to have fun and participate. You don’t have to worry about someone sitting around and doing nothing, unless they’re there doing it on purpose because they’re assholes. You do get that. You get trolls in games just like you get them everywhere else. The question is, can you rob them of their tools to be trolls? The answer is, yes, you totally can. You can do all kinds of things like you can make it. The shared XP is probably one of the best examples. This is less common to be fair, but you’ll see it in other games. You’ll see someone have a power that’s useful to them.

In theory, it’s supposed to be highly useful to the people around them as well. It should be a cooperative power. It’s a heal. As long as I do it near enough to somebody, I’ll get healed but they’ll also get healed. Isn’t that nice? In many games, it’ll be pretty easy. You have to have some skill to execute the heal correctly. If you’re not relatively close to the person relatively skillful, you’ll fail to heal them. You might heal it only yourself. That’s disappointing for them. In our game, we don’t allow that to be a thing.

The heal is this massive bubble that explodes across the screen and it hits anyone even remotely near you. If you’re incompetent, you’ll probably still heal at least a few people. If you’re a troll, you’re going to have to be off the screen to be your troll-ish self and not helping anyone. At which point, who cares, you are off-screen. It’s a matter of looking at the mechanics and saying, “How can I make these mechanics something that someone who is actively trying to be a jerk can’t be a jerk?”

Ostensibly, this work would pay off by making the game more fun because you don’t have to be in a game with a bunch of assholes and practice, is that true?

The nice thing here is that while a lot of the stuff that I’m talking about is fairly unique. We employed many of these tactics in a game that we co-developed a few years ago, and we saw it work well there. I know it works. The thing about that game, which was called Realm of the Mad God, which shared a lot of these mechanics that I’m mentioning now. We developed it with another couple of guys at a company called Wild Shadow in 2011, 2012, something like that.

The problem with that game was that while it had a lot of these great ideas that I’m talking about because we didn’t control it at the time, it was this other company, Wild Shadow, that I did. The community was managing it in a very hands-off fashion. It was allowed to turn it into this highly toxic thing where people regularly were rude to each other and used offensive language. It had half the picture. It had some of the cool cooperative mechanics that were to grieve with, but it lacked the active community management. You still ended up seeing toxicity develop because it will. Anonymous people online, some of them want to be toxic. That’s how it is.

Do you think that you care about this stuff because you’re in Seattle?

I came from Boston so maybe that’s the same thing. I don’t know. I’ve always cared about this stuff.

You got a whole company of people who care about doing this stuff.

They’re all over the world.

Your people are?

Yeah, I got someone in Germany.

This isn’t a uniquely Seattle phenomenon to try and solve these problems in games?

No. I wouldn’t call it common. There’s a lot of people who are concerned about it, particularly toxicity in games, this whole designer communities now forming to tackle this. I wouldn’t say it’s the majority of the game industry that’s fixated on making the world a happier place through games. It’s still a minority, but there’s a fair number of us all over the world.

Maybe starting several years ago, video games essentially killed off most of the toy industry. All the money used to spend on toys got spent on Xbox and PlayStation. That industry is now a little niche. Do you have a sense that the video game industry attracted and a lot more people become more accessible to companies, developers and designers? There’s a multitude of games. I would assume the noise floor is pretty high to get over.

Fortunately or unfortunately, depending on whose perspective you’re taking, it’s hyper-competitive. I like to compare it to some extent to TV and movies, although perhaps even more competitive than those in the sense that pretty much anyone who grew up loving games, there’s a decent chance that at some point they might decide to take a crack at making them. Nowadays with open platforms like iOS, iTunes and Google Play, Steam and all those, pretty much anyone can get together a few of their friends grabbing an engine like Unity, crank out a game and put it out there. You’ve got thousands of games flooding the market every month. Most of them are junk, but enough of them are not junk that it’s hard to stand out. The vast majority of games lose money. That’s true in any open market. Particularly in digital spaces like this one and in entertainment. How many kids do you know that say when they’re young and don’t know better, like, “I want to be LeBron James when I grow up, I want to be Tiger Woods when I grow up?” You have to sit down and explain to them how 0.001% of people will pull that off. Games are the same way.

Your odd of making it are super low.

I feel very lucky to be one of the few who’s making it.

What do you think happened? Was it luck?

A big part of it is always luck. If you’re a humble and honest person, you have to admit that. Some of it’s also timing, which is in many ways a function of luck but not entirely. I was very observant. I like to think I’m very observant. I noticed moments were there’s a blue ocean because the game industry is not like this homogeneous thing. You’ll have moments because a new platform is being born where for example, “There’s an opportunity here. It’s not a red ocean yet.” An example I like to give, it’s a funny one. It was also around 2011. Do you remember when Amazon announced that there were going to be games on the Kindle devices before the Kindle Fire existed? Your black and white Kindles.

The screen refreshes like 300 milliseconds or something.

It was something disastrous. It was terrible. They announced that they were going to allow games on there. I asked every one of my friends where they’re thinking about making a game for it. The answer from every single one of them was either, “I didn’t know that was a thing” or “Are you crazy? The answer is no.” Those were the two answers I got. No one said yes. I said, “Here’s a platform that has millions of people, all of them have their credit card in the system. No one’s going to make games for them. I’m going to be the only one. Let’s give it a try.

Amazon back then was a disaster to work with. They were awful in so many ways. I can’t say it was a good experience, but we made a game called Triple Town for that platform. It cost us $20,000, $30,000 to make. It made over $200,000. It was like an opportunity to learn that this game was a pretty good game. It had a perfect five-star rating for the longest time. We made a mobile version of it years later that reached 13 million, 14 million people or something. I can’t remember how many.

The point is $200,000 is not like that’s a ton of money or anything. It was a 10X profit or 5X profit, whatever it was. It was a safe profit. I was virtually guaranteed to make that money because no one else was going into that market. I’ll pat myself on the back for saying, “That was me being clever.” I spotted an opportunity that everyone else was ignoring. I’ve done that multiple times in my game industry career. Sometimes I pick wrong. I’ve picked platforms that went nowhere.

On the whole, if you do that enough, you can have some advantages that other people don’t have. We also have done it with business models. Dan is my cofounder of Spry Fox. Dan and I got excited about the free-to-play business model way before the vast majority of game developers in the US, before 98% of them or whatever. Most people back then were like, “Free-to-play, that’s terrible. It’s horrible. It’s junk. It corrupts the game.” They went on and on about how it was a terrible business model. It’s also harder to do so why would you bother. We were making free-to-play games back in 2011 before anyone was thinking about that stuff. That was part of the reason we were able to reach an audience of fourteen million people with Triple Town because there weren’t that many people making great puzzle games, free-to-play games back then.

What platform was it on?

Triple Town was in Kindle. It wasn’t free-to-play then. It was free-to-play first on Facebook, back when Facebook games were a big thing. We moved into mobile and it did well there. That was because we had embraced free-to-play in a way that the vast majority of independent developers had not. There are opportunities.

You call it free-to-play instead of freemium or it’s different? It’s free-to-play, but you can spend money in the game to get to watch ads or both.

That was me saying, “This is a business model that’s going to be a success.” There’s no question in my mind, free always beats paid with very rare exceptions, except in the luxury goods space. It was becoming already a big thing in Korea and in China at that time. It’s a matter of time before it becomes a big thing here as well. Observations like that have given me opportunities to succeed where other people didn’t have them. I’ve also made plenty of mistakes. It’s impossible not to. Some of my success is a matter of being in the right place at the right time and having luck. It’s a combination.

If you were trying to get into the business of making video games now, and you’re going into the red ocean because it’s all red oceans everywhere right now. Your odds are low. You’re not setting yourself up to get lucky. You’ve got to look for what opportunities there are to do something different than what everybody else is doing. Doing what everybody else is doing is probably the advice you would give somebody if you wanted to doom them.

If you’re doing what everyone else is doing, you have to realize that you’re competing. There are other companies that exist that specialize in that. They’re good at that. If you decide to make a game like Fortnite now, you’re not only are you competing against Fortnite, but you’re competing against dozens of very well-resourced game companies that are all trying to chase that same wave. You have no chance. You might pull it off, but your odds are incredibly low.

We say this in another business context like, what are your differentiators? What are the things that you’re doing that give you a unique position in the market or a unique offering? These days your companies are like 10 or 12 years old, and you’ve got mostly iPhone games now?

We’re best known for mobile. That’s where we have by far and away the most users, but Realm of the Mad God was a pretty big hit on PC. The game that we’re working on now, Steambirds Alliance, which is the spiritual successor to that. It’s also targeted at PC and consoles. We try to be everywhere in part because speaking of surviving in this red ocean. You never know when a market’s going to go south. It can be hard to tell. Being in many places insulates you from that. I’ll give you a perfect example.

We used a very large chunk of our revenue every year for many years. It has come from Google Play until now. In 2019, that has stopped. There’s a bunch of different reasons. The main reasons are that Google has changed their attitude towards how they manage the marketplace. It’s all AI driven now. I wouldn’t say that the AI is doing a particularly good job. I’ll give you one very simple concrete example. We made a word game called Alphabear 2. It’s a sequel. This is very unusual. I don’t know if anyone else has done anything like this. We partnered with the US Department of Education. We got an SBR grant from them. We worked with professors to build English learning stuff into the game, but in a good way. The way like we were talking earlier where you don’t feel like you’re being forced to learn, but you are learning without realizing it.

We’re pretty proud of this. We put it out there and they did an initial feature of it but it hasn’t gotten as many users as we were expecting. A few months after it launched, I noticed that they have a collection in their store called Word Helpers, Build Your Vocabulary. I look and my game’s not in it. I contact Google and I say, “What’s going on here? I’ve made, as far as I know, the only legitimate free-to-play word-building game in history. I partnered with the Department of Education. There’s a bunch of stuff in this category that’s garbage. It’s not educational.” Their answer was, “Sorry, the algorithm picks what shows up in there.” I said, “You have no way to override that?” They’re like, “Yes, we don’t.” That’s Google there. That’s one of many examples.

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A lot of video games are cesspools for bad behavior.
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That’s the example where the algorithm is not only not working for you and your business model, it’s not working for anyone. Google doesn’t have to pay people to use their brains.

There’s a bunch of other details I could get into, but to make a long story short, they have allowed their store to devolve a little bit. You can see it if you go to the word game category, the top 50 games, they’re all clones of the same three games. The top 50 games are the same three games over and over again. That’s depressing, but the thing is that I could never have predicted that that was going to happen. For years, they were a phenomenal partner and effective to work with and were a big source of revenue for us. We’re very supportive of independent game development in general. It dropped off a cliff over a period of six months. If I have had a business that depended entirely on Google Play, I would have been closed.

I heard lots of stories like that on the search side with Google. Companies who built their business around feeding search results, good stuff ended up getting one update from Google changing their algorithm.

I’ve got stories like that. They have a beta program in Google Play where you can flag your game as an early access and open beta thing. You get people to come in and play it before it’s fully baked. Get yourself some good testing and that program was great for a long time. All of a sudden, out of nowhere, unfortunately for us, the same day we were launching a game in beta, they flipped some switch somewhere without telling anyone. All of a sudden, all games in beta stopped getting any traffic, the traffic disappeared overnight. For weeks, I was sending emails like, “What’s going on? Why am I not getting any traffic? How do I fix this?” I’m not getting a straight answer until we finally yanked the game out of beta because we didn’t have a choice. These things happen. I don’t mean to turn this into a Google bashing because I could tell you stories about virtually any platform where it’s gone south without warning. This happens to be the best and most recent story I’ve got. That’s why we’re everywhere. As a game developer, you are way better off being everywhere because you never know what’s going to come. It’s too risky.

You increase your chances of getting lucky. The way the business works, if I understand correctly, in most cases is you guys get an idea for a game and maybe make some mock-ups or something. You go pitch it to a publisher and then try to get them to buy the game.

That is a way and it used to be the primary way. It’s no longer the primary way for many, and it’s not the way for us.

That’s because you can distribute yourself on iOS or these other platforms.

Now you can reach consumers directly. The need for a publisher has lessen tremendously. They still add value. They are a source of funding.

Maybe for bigger games or what?

When you’re talking about people who are spending $20,000, $30,000, $40,000 or $100 million or $200 million developing a game, they will oftentimes get the money from a publisher because it’s such a staggering amount of money. For us, if we’re making a game that’s going to cost $500,000, $1 million, $2 million, we are often capable of self-funding that. Then the question is, if you don’t need the publisher’s development funding, what else do you need from them? If you’re trying to go retail, all of that’s increasingly not needed. If you need help with marketing, that’s oftentimes one of the biggest things. A lot of independent developers have no capacity to do marketing themselves.

Whereas publishers, their primary function is to be marketers. Now that retail distribution is less important thing, a lot of people will work with a publisher mainly to get access to their marketing team and marketing resources. If you’re a good enough independent developer who’s built a strong community and has a good relationship with that community, you don’t need that probably.

Maybe the publisher, even if it’s not primarily stored, they still might have a big email list or possibly a following or some way of getting in touch with previous customers of other games.

I don’t think it’s just knowledge. There are things that you would think that it’s easy to go and set up an AdWords account and do that advertising and make a trailer. It turns out there are little nuances there. It always ends up being more work than you think. Having a marketing team of ten people who are knowledgeable about this stuff is pretty good if you’re like three guys in the garage trying to get a game out and you don’t know how to get anyone to be aware of it.

You are operating at a scale where you have that in-house now.

Pretty much. We still outsource PR. We’re working with an external PR firm because they’re good at what they do, and they’re not that expensive. We make our own trailers. We manage our own communities. We’re very hands-on with that for reasons I was getting into earlier.

What does that mean though? Does that mean you are reading zillions of messages and replying to people?

It’s a big part. There’s someone at Spry Fox reading everything that shows up in our 1,500-person Discord community, which I hope will soon be tens of thousands or even hundreds of thousands of people.

You’re still going to be reading it all?

It won’t be me. It’ll be somebody.

About how many people does it take to run your company?

We’re eighteen people. We’re pretty efficient as far as companies go. We do way more projects per person than most companies I know.

You’re eighteen people doing the work of 40?

It feels like it sometimes.

One axis of injury here is how do you discourage people from getting into this and encourage them to get into it? You attribute it to luck a lot, but there are a lot of things that you had a lot of work you’d do. A lot of skills you had to develop that were not making and designing games.

I went to business school before I got into the game industry, and that stuff has been very helpful.

If you look at the carnage, where do people go wrong? Do they not give the business and marketing aspects fair consideration or do they not get lucky?

A lot of them won’t get lucky. That certainly is a big part of it.

What do you think of the good ones? You designed a good game. You’ve managed to implement and build it. It’s unique, special, and good in a bunch of ways, but still a disaster commercially. What happened on average?

It’s not a satisfying answer, but on average, you came out at the same time as 999 other games. You got lost in the noise. You could say you’re getting lost in the noise was your fault. That was your mistake. There are a lot of people who underestimate how difficult it is to rise above the noise. For example, a lot of people will think, “If I make something beautiful and exciting enough, I’ll be able to send a video of it with an announcement to the top gaming sites like IGN and whatever. They’ll write an article about it. They’re getting those emails with those awesome looking videos.

It’s a crazy amount. It’s not enough. It’s like, “Did you go and meet them at gaming conferences, have a beer with them, and developed a personal relationship? You didn’t do that. Did you hire the guy who did do that? You didn’t do that either. Guess what? You’re not getting covered.” That’s why I said we hired a PR firm because I’m not out there doing that. There’s a bunch of other things like the platforms. Platform featuring is incredibly important now that the stores have disappeared.

It used to be you would go to Walmart or Game Stopper or some of the biggest companies that are still doing this and you say, “I want to be on the end cap. What do I have to give you to be on the end cap?” You’d pay them some fee or give them a higher rev share or whatever it is that you’re doing and you’d show up on the end cap. The equivalent of that now is going to Valve, the Steam store or going to Epic with their new store and saying, “What it’s going to take to get my games promoted?”

Ninety-nine times out of one hundred, if you haven’t been developing a relationship with them and haven’t been proving yourself, the answer will be like, “There’s nothing you can do, put your game out there, market it and hopefully it’ll do well.” On the other hand, if you’ve been developing a relationship with those folks, you might be able to get them to do something for you. It depends on who you are and what you’re bringing them. Is it worth their time and do they know who you are? Do you have credibility? These are things that a lot of people don’t think through. They’re like, “I’ll build it and they will come.” There are a lot of people who still have that magical thinking, “Build it and they will come.” That doesn’t work in the game space or let me say it works 1 out of 1 million times, which is unfortunately, enough to convince everyone that it’s possible.

It’s the same as the NBA and NFL. When I was a kid, we were like rock bands. We would send out CDs to record labels. What were we thinking? There’s nothing about that model that works. Authors are like, “That will be a bestseller, it such a good book.”

I published a book with Pearson back in 2008, a grand total of maybe 2,000 people bought it or something. It was almost nobody. Minecraft is a pretty interesting example of that thing that inspires everyone. Minecraft was this guy, Markus Persson. He goes by the name Notch. He saw this other cool game called Infiniminer that was amazing and very similar to Minecraft, it never took off. He copied it. Somehow, I honestly don’t know how, his slightly modified version of Infiniminer blew up and turned into a game that he sold to Microsoft for $2 billion or whatever it was. People look at that and they go, “That guy, this random nobody,” he was quite young at the time too, “Look what he did with Minecraft” and the amount of luck involved in that is staggering.

You get a hold of a generation of kids who want to be Notch or Mark Zuckerberg.

There are a lot of people who think they could be Notch. They don’t understand the odds are super low.

Minecraft was particularly fascinating to me. Did you ever read Douglas Copeland’s book, Microserfs?

I’ve heard of it.

It dates to the late ‘90s. It’s quite old. In the book, it’s like some kids who worked at Microsoft and left to start their own company, making this game called OOP, which for you and I mean Object Oriented Programming. OOP described in the book is exactly Minecraft. It’s like a Lego brick game where you could build stuff. Everything about it is Minecraft, but probably the Infiniminers guy got the idea from the book and built it. These things go so far back. The other interesting thing to me was Minecraft was written in Java. You needed to have a JVM installed. Even getting Minecraft working, I couldn’t believe what a pain in the ass it was for me to install and operate Minecraft. It was fascinating to me that it could get so popular being so messy.

This is the fascinating thing about games is that if the game takes off, sometimes the things that seem to be flaws turn into value-add. Kids are excited. It’s like, “This game is full of mysteries and you have to study it and read the Wiki and talk to your friends to understand how to unlock it and be good at it.” It’s transparently flawed, yet the flaws turned into strengths. That requires staggering luck to make that leap.

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No one joins a game just to sit there and do nothing.
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You couldn’t plan that. It’s like Linux. Installing Linux in the ‘90s and 2000s was painful. You couldn’t do it on your own. You needed an entire village to help you figure it out. They’d have Linux install fest where you bring your old PC. We try and upgrade from Windows to Linux through seventeen hours of device driver configuration. That was what made it a community and made it feel like we were the resistance movement. Minecraft had that feeling. I’ve met 8, 9, 10-year-old kids who were better coders than me because they learn to write mods in Minecraft. I tried to get my daughter to drop out of school and play Minecraft because I figured like that’s a better future. She won’t do it though. She wants to play sports.

She’s doing that on top of the coding?

She’s doing scratch now in school. She likes that better. I had made her a deal where she got into Swift Playgrounds on the iPad. I don’t know if you’ve seen that one. Swift is the language Apple made to make a modern interpreted language to build apps instead of objective C with all of its cruft. You can make Mac and iOS apps with Swift. As a way of making it too accessible to kids, they made this thing called Playgrounds, which is an iPad-only app that’s a video game. You play the game by writing code. Each level teaches you one discreet concept. You use that concept to control a character in a 3D world.

It’s pretty accessible if you read and pay attention like you learn to code. It’s pretty awesome. She spent some time with that. I don’t think she loved it, but as long as I did it with her, it became a fun thing to do. The kids who get into it and I met a lot of kids now going crazy with making mods on Minecraft. If you play Minecraft on a PC, a Mac or an iPad, you can install these mods and then you can write code to build anything you want. You can build underground tunnels and subway systems and you can go plant bombs under your friends and blow them up and stuff that you couldn’t do in the normal Minecraft. That hooks kids. That’s analogous to hacking. You feel like, “I got this superpower. I can bake your computer do something that’s not supposed to do and blow it up.” The last thing on that track is if you were a high school kid or a college kid who loved video games and thought they wanted to get into the industry, what advice do you have for those people at this point?

I feel very strongly that it’s like many other things in life. If you think you might want to do it, you just do it. You do it enough that you start to get a sense of, “Are you good at this? Do you enjoy this? Do you have that spark? A lot of people will do things that still mystifies me. They will say like, “I want to make video games for a living.” DigiPen is a well-known university based out here in Redmond. It’s very close by. It’s a for-profit university. People spend four years there getting a degree in game development. My understanding is that a lot of the people, who enrolled in that school did try their hand a little bit first before they showed up.

Some of them just show up. It’s like, “You’ve got to be kidding me. You’re committing to four years of learning how to be a game developer at an expensive school without ever having sat down and tried to make one?” That’s insane. There’s no excuse for that. You should have made at least 3 or 4 games by yourself and/or with friends in freely available things online before you ever showed up for a university like that. It’s as simple as that. It’s like saying, “I want to be a famous musician” and not going out and getting yourself a guitar and spending a few years playing it. You got to do that first.

That would be good advice independent of games. That’s how you ended up going to follow along in a psych ward and in a hospital with doctors before deciding that wasn’t for you. It’s a good thing you did that. That’s pretty rare. Less than 1% of college kids did anything like that before choosing their major.

I take it back. I said I don’t know why it’s rare, but I do know why it’s rare. It’s rare for two reasons. One, parents don’t force this enough and they need to, but more importantly, I don’t feel like it should be the burden of the parents. Our education system is broken. The fact that you can graduate high school, having zero ideas about any actual profession is completely insane. Kids should be forced to be doing internships in high school. In addition to having like a course load, that includes practical stuff, but I’m weird.

It’s not hard to make a case that the educational system is not clearly optimized for anything we need other than basic.

When you look at our educational system, middle school and high school, you look at what kids are learning, and don’t get me wrong, reading, writing and math, these things are very valuable. We know that a staggering percentage of Americans are going to end up getting themselves in credit card debt. We know this is a huge issue or going to payday lenders, yet we don’t teach financial literacy. A three-week class in high school could save trillions of dollars. We don’t do it. It’s mind-blowing to think about it.

In general, our education system is so fundamentally biased towards the more abstract things. I’m not discounting them. They’re valuable, but can we take 5% of education time and point towards the more applied stuff? It drives me nuts. To bring it back to games, that’s something that we’ve worked on and are hoping to work on more in the future is games that teach financial literacy. It’s clear that the education system is not going to solve this problem. I don’t think games can solve it easily. It’s a super hard problem to solve, but no one else appears to be trying so you might as well.

Games are probably already doing some of that. You have to earn a currency. You have to spend it appropriately because there’s no lending. Should we add lending into World of Warcraft?

I had a conversation with a friend who’s knowledgeable about the challenges of teaching financial literacy. He told me something very interesting. He said, “Some people don’t understand compound interest and things like that. That’s a problem, but there are a lot of people who do understand those things and still get themselves deep in debt and totally screwed. Why does that happen?” He said, “It’s pretty simple. They’re in a situation that’s painful.” I’ll make something up. Imagine you’re a single mom. You’ve got kids. Kids need books and clothing for school. You can’t afford it. Are you going to send your kids to school in torn clothing with no books? No, most mothers can’t bear the thought of that.

Even though they know it’s a bad idea, they pull out the credit card and they get themselves in credit card debt. What you have to teach them is not compound interest is important. They understand that. They got a kid who needs clothes. What you have to teach them, which is much harder to teach is I understand that the problem at the moment is painful. You are signing up for dramatically more pain. That’s the thing you have to teach them and teach them in a way that they remember it at that critical moment. That’s hard. Nobody’s teaching that to them.

My daughter played this game called Cashflow that a friend of us showed us. It’s a board game. There’s a kid’s version that she’s probably played since she was six or something. There’s a grownup version that she’s been playing for the last few years that we play occasionally. The game is all about learning the difference between assets, liabilities, learning to manage your income and expenses. She thinks she’s playing a board game, but she learned this stuff pretty well. I think the net effect of it has been she’s quite good at saving money. When she gets money, she squirrels it away and doesn’t spend it, but she’s good at spending my money. She loves shopping and she became a real negotiator.

She’s smart. She knows how to spend her money. She knows that there was no real downside for her to try and spend my money. The worst-case scenario is I keep saying no, and she can ask again. That’s her MO. She’s a smarter kid than I am a parent apparently. The game was made by the guy who wrote the book called Rich Dad, Poor Dad, which was some kind of a bestseller. The lessons are pretty straight forward, but people need to learn that. Cashflow is a great game. They should play it in school. I don’t know if there might be an iOS game by now. If not, somebody should get on it.

There are a lot of opportunities.

When I think about the games, I have this vision in my mind from sometime in the ‘90s, not Snow Crash, but The Diamond Age came out. The Diamond Age is a book that Neal Stephenson wrote. A lot of the themes in there are around nanotechnology and stuff that is interesting, but not important. The important part is it’s the first book that I know of to explore those questions of can a computer be a teacher. The subtitle for the book is A Young Lady’s Illustrated Primer. This is in the ‘90s. It describes what we now know as an iPad, but it sounded so futuristic at the time. It was this little girl and she got this book. The book would tell her a story about a princess who happened to have the same name as the girl reading the book, and then the princess goes on these adventures and learn all this stuff. The book was constantly tuning itself like a video game would for the level of the reader.

It’s an iPad with some excellent software.

It sounded unimaginable at the time, but Neal’s been responsible for a couple of these things that inspired an entire generation of geeks to go figure out, how do we build that? iPad is doing a lot of that. It’s more haphazard, less strategic and lots of room for improvement. In my mind, it always opens this question of like, “Because the computers are scalable and the teachers aren’t, could we close that gap and could we make the iPad or whatever to take over the things that it’s better at than a teacher?” The logical next question is, “What are the limitations of that?” We can teach literacy with games. We probably could teach personal finance skills with games. We can help people reduce anxiety and other kinds of things, but is there some practical limit on that? If we were trying to figure out in that equation of like, “Now the games and the computers are going to help teach some of this stuff, what’s the stuff that teachers should be optimizing for that the games can’t do?”

I’m probably not going to give as good an answer as someone who’s like my cofounder, Daniel. He’s a designer who has been thinking deeply about design for twenty years. He may give you a better answer. I’ll give you my off the cuff feeling, which is first of all, games are good at teaching you things that require repetition. While a game isn’t necessarily going to be the best way to have some complex mathematical concept presented to you, although in some cases it might be.

Once I understand the concept, now I just need to repeat it over and over again. Games are a great place to do that. Games are also a great place to engage in behaviors or learn things that would be dangerous to do in real life. Perfect example, I’m amazed that given that we now have pretty good VR tech that you don’t start seeing driver’s ed, where you’re doing 500 hours of a VR driver’s ed before you ever step foot in a car. We already have good driving simulation software, that already exists. There are tons and tons of games.

I’ve learned so much about that industry. All the drivers train in simulators. The Formula 1 drivers aren’t even allowed by the race association to spend time on a track in an actual Formula car. They do it all in a simulator.

My understanding is that people who want to get their pilot’s license will oftentimes spend tons of time in Microsoft’s flight simulator because it’s so good. It’s the same idea. That’s a pretty good example. Maybe I’m not being fair to driving. Driving 30 miles an hour on a regular road is not all that complicated. It doesn’t take that much to understand how it works, but it turns out that there’s a lot of behaviors you need to train yourself to do like checking your blind spot and muscle memory that you have to build up that takes time. Perfect example, not a complex topic, but you need a lot of rope practice and repetition. You need it in a safe environment. Hurray games.

Maybe like grammar or sentence structure might not be the best thing for a game to teach vocabulary would be.

A game exists that helps with both spelling and vocabulary, it’s called Scribblenauts. It’s not one that I’ve made. It was made by a friend of mine. They’ve made several different versions of it. It’s a game where you have your little guy. He’s your Scribblenaut. There will be a challenge like a lion sitting there. It will be like, “The lion needs sleep, but it can only fall asleep in the dark.” There’s a big sun hanging over the lion. You have to figure out how am I going to help this lion go to sleep. You start writing in words. If you write in words that the game understands, it’ll create them.

You can write an umbrella, for example. An umbrella will appear on the screen, and then you position it over the lion’s head and the lions in the shade, and it can fall asleep. It’s an amazing game. It’s made by a company called 5th Cell here in the Seattle area. I’ve had many people come to tell me when I told them I was working on a word game. They were like, “My kids learned vocabulary or spelling from Scribblenauts.” What will happen is you can imagine a kid typing an umbrella, but they misspell it and then the game’s like, “Did you mean umbrella?” They showed them the correct spelling. “That’s what I meant” and whatever.

It’ll also suggest other words as well. They can ask for hints and then they learn words from those hints. You totally can learn vocabulary. In Alphabear 2, what we’ll do is we have a grid of letters, not exactly like in Scrabble, but similar to Scrabble, you’ll use the letters to make words. They don’t have to be next to each other like they do in Scrabble. One thing that we do to teach you, instead of a single letter on any given tile on the grid, we’ll put a set of letters that are a morpheme, like a prefix or a suffix. We’ll have the letters T-R-I show up on a single tile.

If you tap that and use it to spell a word where T-R-I means three, you’ll get bonus points because tri is the morpheme of the day, and we’re teaching what that morpheme is. That’s an interesting one because that’s not simply teaching a single word, that’s teaching you a route that can be used to make many words. Maybe someday you’ll see, for example, because we taught you M-A-L oftentimes means bad or evil. Later you see the word malice, you may have never seen that word in your life, but M-A-L means bad or evil. Malice is probably something related to bad or evil. Games are pretty good for this. There are already several examples of it including one that I’ve worked on. I wouldn’t expect the game to necessarily teach something dramatically more complicated like some various science topics or history, for example. Even Civilization did an okay job with that. In general, if you want someone to understand the ins and outs of the Watergate scandal, for example, you probably need to make them read about Watergate.

In an industry as a game developer, what technology do you wish you had the most? If there was something that doesn’t exist that you wish would exist that could make your job better, make games better or your ability to make them better? If you had a magical wishlist, what’s the first thing on it or make things more awesome?

In general, a lot of effort goes into the server-side of multiplayer games. Making a game perform and be scalable, not likely to crash, not be hackable. All of those things are still hard. There are at least a dozen companies trying to solve that problem. None of them have done it yet. At some point, it’ll be solved, but that’s one of the big ones. There’s also a lot of junk, which at this point, we’ve solved. Several years ago, I would’ve been so happy if somebody had come to me and said, “All that stuff that you have to do to make a game like a service, like having accounts for people, being able to modify their inventory on the fly if they contact customer support, this, that, analytics, knowing what they’re doing, when they’re doing it and how they’re doing it.”

If someone had come to me several years ago and said, “Here’s the thing that does all of that for you and it’s good,” I would have been delighted. I’ve spent millions of dollars making it myself. Now they’re starting to be, there was a Seattle-based company called PlayFab that was acquired by Microsoft that does that. They do that stuff. There are a few other people. Amazon has a company they acquired that’s doing that stuff too. My guess is in a couple of years from now.

Do you think that games are being held back by technology in some ways? Especially as people are playing mostly on their phones and have these tiny screens and no buttons and stuff, do you think that’s holding things back?

Here’s the thing, if you’re a creative person, I like to think of myself and certainly Daniel, my partner, very creative. We don’t tend to lack ideas. Constraints are oftentimes valuable. The fact that the phone doesn’t have buttons, it’s like, “I don’t have to think about all those ideas doing buttons. I can focus on the million ideas that don’t require buttons.” The constraints are fine with me. For me, the biggest challenge at this point that’s increasingly becoming is reaching people and getting through the noise like we were talking about earlier. It’s very hard to break through.

As the big companies increasingly become obsessed with cutting out human moderation and being AI-focused, it’s getting worse. Both Valve and Google have both emphasized algorithmic surfacing of content. I don’t think either of them are doing a particularly good job of that. In fact, I would go so far as to say, they’re both doing a terrible job of it. Epic, which launched their store. They’re all about moderation. They released very few games every month. They’re all handpicked by them. That got its own problems. If they’re only releasing 1 or 2 games a week, that means the vast majority of developers will never be able to release a game on that platform.

That said, if you can be one of those who gets to be part of that, you’re delighted. There’s a middle ground between what Epic’s doing and what Valve and Google are doing. There’s a middle somewhere where it’s open, but you also have a team of people. That team of people might need to be quite large, but that’s okay because these services make billions of dollars. There’s a team of people who are doing their best to curate the content in a way that at least some significant amount of good stuff is bubbling up. You don’t end up with a Google Play word games category, that’s the top 50 are all the same three games copied over and over again.

The company that you made has some strange ambition at least in the way that you run the company. I know you told me at different times about different aspects of ideas that you had about how to run a company. I’m curious how that’s working out.

Which part of it do you want to talk about?

You had ideas that did not work out that you’ve abandoned along the way too. What do you think is the most unusual thing that you guys are doing?

The most unusual thing that we’re doing as a company is how we compensate our employees. That’s almost the most unusual thing or at least that’s what most people would say. We have a need-based compensation system. What we do is when we’re first interviewing people, we asked them to tell us what they need to live comfortably. A lot of people, when you ask them that, their minds explode. They don’t know what that means. We walk them through it.

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Free always beats paid almost always with very rare exceptions.
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It’s like, “You’re paying all your bills. You’re going on vacation. You’re saving appropriately for retirement. You don’t have to worry about anything. You’re not living luxuriously. You can’t go out and buy a Ferrari, but you never have to worry. You won’t have to worry 30 years from now when you decide to retire.” We walked them through all of that. We say, “Give us that number. If we can afford that number,” which I can’t guarantee I can, because you might come back with a million number, “I’ll pay it.” There will be no negotiation. It doesn’t matter who you are. It doesn’t matter what your job function is. I understand that maybe you’re “just” a QA person. This other person is an engineer who would normally be making three times than you are. I don’t care. That’s not how my company works. I pay you what you need. I value everyone equally.

Extensively, that means at least in some cases you’re probably overpaying people from the market perspective.

We are overpaying some people from a market perspective and underpaying other people.

What do you think is the point of this system?

It’s to make sure that all my people are happy. It’s based on Maslow’s Hierarchy of Needs. It’s based on this idea that once you have no financial issues of any kind, you have maxed out on happiness for money. If I can give that to every one of my employees, I want to give that to them. I don’t want to give more than I have to the engineer solely because he’s an engineer, and less than they need to the QA person solely because they’re the QA person. What that means is I have to employ people who buy into this because the engineers are giving up something by coming here. The engineer could be making more somewhere else, but I hire people who are into that. They’re like, “Yes, I want to be part of the company that values people that way.”

Do you think it’s buying you the thing you’re looking for, which is that happiness factor?

It seems like. It’s not going to work for everyone. This is not even a judgment of them. This is not a criticism or anything. I don’t have any problem with someone saying to me, “I know I can make $300,000 a year. I’m going to go do that.” Good for you. That’s awesome. That’s wonderful. I make no judgment. I know that there’s a segment of the population. It’s funny. We have a guy working for us. We were having this conversation. He made me laugh. He says, “My mom keeps harassing me to go get a job in the federal government.” She works in the federal government.

She says, “It’s the best job in the world because it’s utterly safe. You never have to worry about anything. You’re going to retire with a pension. You’re going to be fine.” He laughs and he’s like, “That’s what’s like. I never have to worry about anything. Instead of having a crappy job in the federal government, I make games for a living.” She can’t comprehend that because it doesn’t exist anywhere else. I have yet to meet another company that works this way. I’ve been asking everyone I meet.

This is something you pioneered?

I don’t know who does. I made this up. I’m not that kind of person. I am not particularly risk-averse in this way. I have been willing to live off of peanut butter sandwiches for however long I needed to get companies off the ground in the past. There are a decent number of people out there for whom financial anxiety is a real thing. If they can eliminate it from their lives, that’s the best thing ever.

Do they perform better do you think?

I think so or let’s put it at least this way. I don’t know if their performance and my company are dramatically better than it would be at any other company. I do know that they’re much happier people. As a result, I have their loyalty in a way that no one else would have.

In theory, the federal government might have a better track record of longevity than a game company.

That’s true. I have to admit that. I can’t guarantee that I’ll be around the same way they will. On the other hand, they’ve done more for those than I have.

A lot of times it seems like we take the normal compensation structures that other companies have for granted in an unquestioning fashion, which is why you’re in the business of teaching your potential employees about personal finance to be able to comprehend the job offer. You are in some sense trying to solve a problem that maybe they didn’t know they had. More importantly, you are in a position of pioneering a different model here. Whether or not yours is a good one or good for anybody else, the act of doing that is hard. It probably comes with a real cost. Some people maybe weren’t even willing to invest the effort to understand why the model would be good for them or you.

That I’ve never had. That might also be a function where cool games company that people want to work for. Maybe if I was a bank, people would be more likely to walk away. I can’t pretend that I know. This is a model that could work almost anywhere, but I wouldn’t be surprised if it needed adjustment of some kind to make it work in less interesting issues.

Do you have staff outside of this area physically?

Everyone works from home including me.

Do you think that that’s another thing you have to screen for and find people who are amenable to that?

Almost everyone with very rare exception thinks that they’ll function well in that environment, but not everyone ultimately will. We’ve started to learn little signs of that. We have plenty of introverts who worked for the company and they’re fine. Extreme introverts, the kinds who have no life outside of work. We’ve hired only one. We were afraid about what happened and sure enough, it didn’t work out because that person was like, “I’m miserable. I have no social life anymore. The only place I ever interacted with humans was at work and now I don’t do that.” That’s an example of we will ask people questions about their social life, “What are you going to do when you’re stuck at home all day long? How are you going to get human interaction? How’s it going to work for you?”

We ask questions like that. There are also things like, how much of a self-starter they are? Someone who’s not a self-starter does not do well in that environment. I’m not there to see that you’re doing nothing and give you a pick me up speech. You got to take care of that yourself. Self-starters are super important, people who can deal with the fact that they don’t have a physical work, social life anymore. In general, this is similar to the self-starter. We’re not a micro-managing culture in part because I’m not there to physically do it. That’s a good thing, frankly. I don’t want to be a micromanager. There are some people that need that. They need someone telling them, do this, do this. It’s not going to be us. You have capable of figuring out, “I did this thing so I should probably do this other thing next,” without bothering anyone.

One of the things that were a misconception about introverts because I’ve worked with at least quite a number of people who are more introverted. People think that they’re anti-social. It’s not the case. They want to be in a context where they do get some social interaction, but it needs to be maybe limited or managed in some way.

I’m somewhat introverted but almost nobody knows it. If I’m around someone like you who I’ve known forever, it doesn’t cost me energy. This is fine. This conversation is easy for me. If I’m talking to someone I’ve never met before, it’s draining. There’s no question about it. That’s why someone who’s an extreme introvert might care about having a job in an office where they know everybody. It’s a place where they can go to be with other human beings, which is important to all of us. There’s nobody who wants to be alone all the time. It’s not draining for them because it’s people they’ve known for years and they see them every day. It’s a routine. It’s relaxing. As opposed to, “Crap, I don’t have an office to go to anymore. I’m going to have to meet people now like total strangers. That’s terrible.” Introverts need social exposure like the rest of us.

Maybe you haven’t run into this, but for people who are on the autism spectrum or Asperger’s people, a lot of times what I find is they need somebody not to micromanagement, but to tell them what to do next. They’re good at focusing. They’re good at working and going deep. They will potentially keep doing it even when they shouldn’t. They need somebody to manage their attention and time and prioritize. If you can pair them with that person, they can be wildly effective.

Those people can be incredibly valuable in certain tasks. There’s no question about it. I’ve worked with quite a few people who have Asperger’s and they were some of the best people I’ve ever worked with. A company that’s remotely distributed like ours can work with people like that. It is harder and it’s something you have to be very conscious about. We underestimate how much information we gather as human beings just from looking at someone like their facial expression, what they’re doing with their hands, whatever. You got a lot of information about what’s going on with a person by doing that. In a remote environment, more often than not, you’re not doing video chat.

You’re quickly text chatting on Slack or whatever. You have to be especially vigilant as a manager of someone who needs that high touch when you’re not able to look at them and know what their needs are in part from that alone. I’m being honest. We want to be a small company. Part of the reason that we do what we do well and can do this weird compensation thing is because it’s more of a family than a giant company.

You don’t have the ambition to be a big company.

I wouldn’t cry if we had a game so successful that we had no choice, but to be much bigger. It’s not something I have an ambition for. I want to make millions of people happy. I’ve already done that with eighteen people.

I don’t know that much about how WordPress automatically does it. In my experience, I can work remotely well with people if after I have worked with them in real life. If I had that context and I’ve got a working relationship with them, then maybe my brain can visualize what their facial expression would be at any given moment. It makes it easy because I have a working relationship. If I don’t have that, I get a lot of miscommunications, misfires and people take offense at the things that I was being brief. That stuff drives me nuts. Do you have to screen people for writing? I assumed automatically was finding people who love to write because they’re all about blogging. People write, they write emails, they read a lot and they’re into that. That’s why it works.

There’s no question that communication skills are a key thing. I should have mentioned that earlier when you asked, what are you interviewing for? If you can’t communicate clearly in Slack or whatever channel we’re using that work for us. Most of our communication is texts. That said, there are other things. I haven’t talked to anyone at Automatic about this so I don’t know if they have changed. When I was doing some consulting for them ages ago, they’re broken up into teams and every team gets together up to four times a year. Since they live all over the world, it’s usually picking a place they all want to go hang out.

They’re like, “I’ve never been to Budapest before. Let’s go there.” They go and they hang out in Budapest together for a week. That’s a critical part. It’s exactly what you were saying. They can learn how to interact with each other better and form a more human connection. When they go back to their separate homes it’s like, “I remember Pablo says this kind of guy. He makes these kinds of sarcastic jokes. It’s no big deal.” It’s a thing.

Do you guys meet up?

Yes. We don’t do it four times a year. I don’t feel comfortable spending that kind of money yet. We usually do it once or twice a year. In June 2021, we’re all going to Mexico together. The same reason exactly. It could be a coincidence. Almost everyone who comes to work for Spry Fox stays with Spry Fox. The small number of people who haven’t worked out and who have left voluntarily, I don’t think it’s a coincidence that a decent number of them skipped the retreat that happened before.

It seems like that would be mandatory.

They always have good reasons. Usually, it’s like, “I had a kid. I had to be at home.” It’s been noticeable. Not going to retreat is a huge sign that within a year, you’ll probably be gone.

Do you guys do team-building exercises and trust falls?

Just hanging out and having a good time. We try to make it a week of vacation. Because we employ people all over the world, you’ll see real cultural disconnects. For example, the guy from South America who comes from a culture that’s very respect-centric have massive communication issues with the guy in the UK, who’s used to being like, “Your code sucks and here’s why.” That doesn’t work. You can’t say your code sucks and here’s why to this guy. He thinks he’s being disrespected. You have to say it differently. The retreat is part of that. I can’t always stop that conversation from happening as much as I try. I can at least bring those two people together and make sure they’ve had a week’s worth of beers together. When they go back, they both remember this person is a decent person. Hopefully, that dampens the rage they feel when the communication comes through the wrong way.

You’ve encapsulated a big part of the problem we’re having in the world which is you stick everybody online and rather than respect for different cultures, what we get is this collision where everybody feels disrespected, everybody feels unheard.

They don’t even see each other’s faces. They don’t even realize sometimes when they’re pissing someone off.

For me personally, I’m so enriched by the fact that I get to travel a lot and I get to go all over the world. I go all kinds of places and almost none of them are like, “I wouldn’t want to live there. I wouldn’t want to live like that. I don’t know why these people are like this,” but you learn to appreciate it. It’s okay. That’s their thing. They’re doing fine. I don’t know it that way, but it can be that way and it’s fine. I feel like it gives me an appreciation for different cultures that I wouldn’t be able to get. You can’t get that online.

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As a game developer, you are way better off being everywhere because you never know what's going to come.
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It’s super valuable. I used to talk about how I wish we had a year of national service in this country and make people who live in cities go live in rural areas. People live in rural areas, go live in cities.

Take American teenagers, dump them off in sub-Saharan Africa and tell them they can come back when they’re cool again. I’m for it.

It would make a big difference. It’s very subtle too. Sometimes you’ll take two people and you’ll think, “They have such similar backgrounds.” Still, there will be big cultural issues. I remember there was a guy. He was our CTO for a while, a very good friend of mine. I’ve known him for years. We met at MIT well before I even entered the game industry. I remember we were having a fight one time. At some point, he blurted out. This is a guy that we both had upper-middle-class upbringings, the United States and major cities. We’re both programmer types who went to MIT, the whole nine yards. In theory, we’re very similar people.

We’re having an argument. At some point, he finally blurts out. He goes, “You always want to win every argument.” I got caught by surprise. I’m like, “That’s not how I am at all.” “No, you never allow an argument to end without you winning it.” I had to stop for a second. I was like, “Why does he think this?” I like losing arguments. It’s an interesting thing. If I lost an argument, it means I learned something, which is a delight. It’s wonderful for me to be in that scenario, but he did not have that impression at all. He was like, “This is a guy who has to feel like he wins every conversation.”

I had to explain to him that like, “This is how my family is. We learned by arguing. If you say something to me that isn’t obviously right to me, I’ll keep arguing with you until you either prove that you’re right. If so, that’s awesome. I learned something or you don’t, that’s that. It’s not like I need to win. I don’t care if I win.” That concept was so foreign to him. He was like, “I don’t believe you.” We had to talk about it for weeks before he was like, “Maybe I can see where you’re coming from.” It’s not like he had to change. It also was one of the first things that made me realize that not everybody has a culture of debate in their families growing up. It’s not a thing. For some people arguing is a toxic behavior.

Everybody has to learn that. My mom is from New Jersey and Irish, Catholic family. They argue all the time as a means of discourse. I’m like that. Growing up, if people see me and my mom, it looks like we’re arguing all the time. We were just talking. Even for my brother and my dad who don’t like that, they don’t participate. They don’t like the confrontation. They don’t want anything to do with it. They’d been around us our whole lives. My mom and I were arguing, my brother and my dad going, “What’s wrong with them?” It’s something I learn about myself. I want to do that. I want to argue and figure out, and shoot holes in the idea and see what’s left standing at the end of the day, but lots of people aren’t for that.

You have to realize that. That’s the thing that I’ve learned working remotely with people is that I have to identify which are those people, which aren’t, and behave differently depending on the situation.

I was hoping that maybe I could get away with making them play my way, and they would get comfortable. I realize now that you said that it’s like trying to get my brother or my dad to come around, it’s never going to happen. They’re always going to not like it. I don’t know if you have answer to this. The need-based compensation, are there other strange utopian ideas you had about running a company that you tried that didn’t work?

This is not utopian. There are a lot of companies doing this and they’re doing it successfully. We just failed. I had hoped that despite the fact that we’re this small remotely distributed company. We make a big effort to hire nice people. The criteria is like, do you like this person? Did they seem nice? Would you want to spend a lot of time around them? Not every company cares about this. I assumed that given that those are the kinds of people that we hire, even though we’re remotely distributed and small, we hire senior experienced people.

Given all that, I figured we could hire a few junior people and mentor them and it would be fine. You’re hiring such smart people and they’re so nice. Surely it will work out. It’s almost always a disaster. Virtually every time we hire someone who’s junior like out of school, it’s a disaster. We do not have the ability to mentor them the way they need to be mentored. They need time, face-to-face with someone in an office environment, someone who can coach them when they’re doing stupid things. It’s not always negative but in general, give them guidance. We don’t have time. We’re all off in our own little houses doing our thing. They’re off alone for hours at a time sucking. It’s hard to fix it. In particular, as so many people do when they’re first out of school or a couple of years out of school, it’s hard when they tend to have not necessarily the highest level of maturity. None of us do. I didn’t. I wasn’t the most mature person when I graduated college.

When they’re off alone, they were like, “I get to make my own hours. I’m going to do karaoke all day long, maybe work from 2:00 AM to 4:00 AM because I can. The impulse to behave in ways that are probably not conducive to an effective life increases in a remote environment like ours. Whereas if you’re an intern at Microsoft, you’re expected to show up at the office every day from 9:00 to 5:00. At the very least you have to be that responsible. There’s a bar that gets set that you don’t have to worry about clearing. It’s unfortunate because I was a bit utopian about that. I was like, “We can be a small, remotely distributed company and yet be a great place for young, inexperienced people to work.” We totally can’t. We have failed that test multiple times.

Outside of games, what’s the thing that you’re most interested in?

There are a few things. On a personal level, I’m super interested in anything related to anti-aging. Unfortunately, there’s nothing in games that gives me any insight into that. I ended up reading MIT tech review and scratching the itch that way. I’m very interested to do that because ever since I was a little kid, I was terrified at the idea of getting old and dying. I’m only a little bit better about that now. I’m interested in anything related to gardening and growing crops mainly because it’s a big hobby of mine. Partially because I love it. It’s fun for me. Partially because particularly with climate change and with the explosion of the human population, that’s a thing. We need to figure out how to feed all these people. I’m interested in that topic. My number one that we’ve already touched on a lot is education. It’s not just education through games. It’s education in general. I am not like a lot of other people, a lot of other people are like, “I have the answer. It’s charter schools. It’s this and that.”

I don’t believe in that. There’s no one size fits all answer. I highly doubt let the private sector solve it is the answer either. There’s a whole range of problems including teaching financial literacy and solving for students with particular learning challenges like dyslexia. There’s a bunch of stuff that I’m interested in. I could totally imagine myself at some point deciding it would probably be many years from now being like, “I’m done making games.” I’m going to focus on education in that regard.

Lastly, mental health. The reason I’m interested in mental health is unfortunately, and I’m a little bit sad about it. My sister suffers from paranoid schizophrenia. It’s been something we as a family have been working on for many years and trying to help her with and hasn’t been going well. One of the challenges there, and a lot of people who don’t have someone with severe mental illness in their families doesn’t know this, the laws in this country are not particularly conducive to helping people with severe mental illness.

It’s for good reason. Way back in the day, meaning however many decades ago, it used to be way too easy to commit someone against their will. It was happening all the time for BS reasons like, “My son let me know he’s gay.” At some point, I don’t remember if it was like sometime around the ‘50s or something like that, the pendulum swung and the laws changed radically. It became virtually impossible to force someone to receive mental health treatment.

They have to be a clear and present danger to themselves and/or others, and proving that is super hard. You can have someone who is functionally incapable of operating in society, cannot take care of themselves, is going to become homeless because of their issues until they get to the point where they’re going to hurt themselves or somebody else, which is silly. Why we would let it get to that point in the first place? That’s how the laws in this country work. I think a lot about that because it impacts me in a very personal way. For starters, we have to change those laws.

How would you make them better?

There has to be some system and unfortunately, it will likely be an expensive one. Although I don’t think it will be any more expensive than our broken system. There has to be a system where you could have a panel of experts who at the behest of family and/or friends or whatever, will take a look at someone’s case and be like, “Yes, this person needs to be forced into treatment before this situation where they become a danger to themselves and others.” This is honestly a matter of advocacy. At some point, there’s a chance that I’ll say, “I need to be spending the majority of my work hours doing advocacy trying to change these laws and get a better system put into place.” There are a lot of other things too. There are a million things we could be doing to make mental health care better in this country. That’s a problem I’m particularly aware of that is causing a lot of pain and suffering for millions of people. I’d like to help fix it if I can.

I don’t know about that one. With education, one of the things that keep nagging at me that’s like a recurring nightmare is this conversation that happens almost every day about, “What if robots take all the jobs?” When that happens, I’m often trying to suggest that if robots take all the jobs, then we could get back to working on things that are important. For example, we often cite truck drivers as a job that’s in jeopardy because self-driving trucks seem imminent. If trucks can drive themselves, then what are all the truck drivers do. It’s a quite poor example because there are 50,000 open truck driver jobs in America. It’s much better to try and talk your kid into being a truck driver than a doctor or a lawyer. We don’t need more lawyers, but we do need truck drivers.

There are no self-driving trucks. The point is, I was being flippant, but I’ve said a lot of times that if I could, I would trade any of my kids’ teachers for a displaced truck driver and a one-to-one student-teacher ratio. What I see is that these are not technology problems. I see them as human values problems. We’ve chosen to pay humans to drive trucks full of plastic crap to Walmart instead of paying humans to teach our kids. My daughter’s school, she was in public school for years, every time, it’s 27, 28 kids and one teacher. We can go to PTA meetings, bitch about it and try and get it down to 26 to 1, but that’s not going to move the needle.

There’s no plan, no idea how you get down to one-to-one. One-to-one is where you get a good education. I keep thinking that those are the kinds of things that need a lot of work to advance our economic structure to be able to handle that thing. If we could do those things, then we could change what’s happening in education. You could get it away from this farming kids thing and keeping them out of the labor force as long as possible, incurring as much debt as possible, teaching them as little as possible, and get them to a point where they could thrive.

It had never occurred to me until you said it that millions of people are going to lose their jobs to robots, but so what? We have a great place to put them.

Another way I’ve tried to frame it at different times is I’m speaking a lot. I often start by showing a population growth curve for all of human history. The curve is the classic hockey stick where it’s like flat, thousands, hundreds of thousands of humans, millions. It’s then in the last few hundred years, we go from millions to billions and it’s a crazy growth curve. Another way to read that chart is that we made a few billion jobs in the last few hundred years. We’ve never failed to come up with things to do a lot to do. Even with billions of people working, we’re not out of things to do, class sizes haven’t improved. In fact, they’ve gotten worse or the same time that we’ve made an extra 6 or 7 billion people, we still haven’t improved class sizes. They’ve gotten worse.

I don’t know, but lots of work for truck drivers. Those kinds of things are important to look at because we’re not so good at imagining making things different, but we could make them different and we could do that. That’s how I think about the potential for education beyond using computers and games to try and improve it. We could use people. That turns out to be the thing people are well suited for and robots aren’t.

This is not an area that I personally have a lot of interest in, but if you want to tie it back to entertainment. People are good at entertaining other people. That’s one of the things we’re best at. When you think about it, what do we do with all these people who are going to be put out of work by the robots? They can make entertainment for the rest of us. They can be entertainment for the rest of us.

That is what happened because with the industrial revolution, we got efficient enough for the first time that not everybody had to work all the time. That’s when you did get in entertainment industry. The entertainment industry is maybe 50 to 100 years old. Before that, everybody had to work. There was no such thing as a video game developer. There was no such thing as Nirvana or Toy Story. You don’t get those things. You have to work. It’s true of books, music, movies, elections and video games, all the things people are doing to fill our free time.

That’s the thing. When you talk about books and movies and games and all that, those are all scalable forms of entertainment. They take a thousand of us to make this movie, then it can entertain a billion people. My point is that it doesn’t have to be scalable. You can totally have, particularly in a free-to-play base game economy where a small percent of the population is spending a lot of money. You could have people that you’re employing whose sole purpose is to make sure that people who are spending money are entertained.

We have like buskers in video games. If people had free time and if there was a functional business model for it, you could get paid to go entertain people even inside of a game.

That’s already happening very quietly in some contexts. Game companies aren’t hiding that, but I have heard stories of game companies being like, “We have this one guy who spends $10,000 a year in the game. We have like our VIP team making sure that he’s feeling like he’s taking care of and entertained.”

Nightclubs do that. They hire congenial people to go to see the operation and make it fun for people. Disney is doing that at Disneyworld with people in costumes. Do you have any questions for me?

The main thing I’m wondering is I know you’ve told me in the past that you’re not a gamer. You’ve made that very clear. You’ve told me in the past that there are aspects of game technology that you’re particularly excited about. You used modeling as an example where you started talking about that early on in this conversation. Is there still stuff that’s bringing your head like, “I want to use games to do this?”

The last game I played was Ultimate 3. It was a good one because you could edit the bitmap for the world with a sector editor on the floppy disc. I would go in the sector editor and I could read hexadecimal in those days. I figured out that 3F was like water. If I changed it to like 6D then all of the water would become boats and you could walk on water. That’s the early experience with computer hacking for me. Hacking games got interesting. For most of my life, I would acquire every game, every application ever made. For Apple, I don’t think there was ever a program made that I didn’t use.

On a Mac from like ‘84 when it came out probably up until the late ‘90s, every single program ever made, I would acquire it, usually pirating it. I would fire it up, click on all the buttons, click on all menus, try everything, figure out what it could do. I was interested in what computers could do. That’s the thing that always interested me the most. What can these things do for people? How do we make them do new things for people? I’m still doing that. I was an aficionado of like what can computers be used for? I would try every game, but I wasn’t as interested in playing games as in seeing like what’s new about it. What’s different about it? I’m looking for what’s new and different. In my whole life, I’ve been trying to learn about every new thing a computer could do.

By the late ‘90s, you could download software online. It got pretty efficient. Every morning, there were like websites that showed what was new. I would download everything new, try it all, delete it, then move on. By 2000, 2001, it was too hard to keep up. Since then, I’m more judicious, but I’d say before that, I’ve tried everything. Games, I love them and appreciate them. For some reason, I feel like I’m wasting time. Anytime I’m playing a game, I feel like I could be doing something more productive.

That’s what a lot of people are saying. I’m at the point now where I barely play games when I’m not making them. I love them. It’s one of those things where it’s like I could be playing with my daughter right now. Although now she resented play games together. There’s a little bit of games coming back in that way. I could be spending time with my daughter right now. I could be teaching myself guitar or I could be out improving the greenhouse. I’m obsessed with gardening. It’s one of those things.

I feel that way even more so about gardening. I got hooked on this idea long time ago that I should be doing what I’m uniquely good for. If I’m ever doing something that other people could do better than me, in general, I feel like I shouldn’t be doing that. There are a few exceptions like snowboarding or something, picking up lunch. I do those things because it’s more efficient. In general, that’s how I feel about it. When I’m playing games, I feel like, “I’m not going to get good at this.” Lots of other people are better at this. I’m not going to be making games or contributing. That’s why I don’t play them.

They tend to be time-consuming. This is one of the very unfortunate things about the game development industry and nothing has made this better. Mostly the evolution of the industry has made this worse. Consumers expect essentially infinite entertainment from any game that they get, whether they paid for it or not. This is not true of all games, but for many games, you have to design them. They’re giant time sinks because otherwise a vocal segment of your community will bitch, moan and leave you bad reviews.

They don’t feel like they got their money’s worth.

The irony is sometimes they didn’t even pay for it. They didn’t get their money’s worth. It’s crazy. You’ll go into Steam and you’ll see a review. Steams shows you how long someone’s been playing when they left a review and it’ll be like 35 hours. There’s someone being like, “This game was too short” and thumbs down. You played it for 35 hours. Because of that dynamic, this is why you feel the way you do when you play games. It was merely the review thing or whatever, but you remember for free-to-play games, most of those games, the way they make money is by getting you to be excited about the game and become hooked onto it for months, if not years, and then spend money in it regularly. That’s how they make money. They don’t make any money from it showing up. In fact, they’re losing money because you’re eating a bandwidth and not paying them anything in return.

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A lot of people underestimate how difficult it is to rise above the noise.
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It’s one of those things where the economics of the industry have shifted radically towards eating up all your time. Compare that to when games first came out. Do you remember when we were kids and the arcade games first started showing up? It was the exact opposite. You wanted someone playing as little as possible because they were hugging the machine. You get more quarters. They were intentionally designing the game to drive you away after about two minutes. How times have changed? The irony is if the business had stayed that same way, not the eating quarters part, but if it had stayed in this like, “We’re going to purposely get rid of you after a few minutes, you might be a hardcore gamer because it would be like this delightful diversion that only eats up fifteen minutes of your time.”

The economics of it scared me off like arcades. I had computers at home when I was young. I played lots of Road Runner and those things when I was younger and probably didn’t value my time so highly. My daughter is twelve so we play games, and we have her whole life played mostly. She plays video games. I encourage it unlike other parents. Lots of parents ask me, “My kid plays too many video games.” Rejoice lady, they could be watching Netflix. She does watch Netflix. I try to steer her onto games more. She does both. She’s amazingly good at games. We also play card games and board games, which I have loved because they’re so interactive.

It’s the thing for us to do together. One of my buddies is Elan Lee, who’s making some of these games and he plays them all as like a professional responsibility. He knows all the games because he’s trying to design games. Her whole life is like, “Elan, what should we play next?” He would tell us what to play next. I had the best of collection of games in her life. We also get to playtest all his games before they came out. We have prototypes of some of these games that we got the prototype for the newest one, which is called Throw, Throw Burrito. It’s a cross between a card game and Dodge ball. It’s so much fun. We’re having a blast. We have a prototype so instead of foam burritos, we have foam mangoes we’re using instead because it’s a prototype.

I wish more games require that interaction with people.

His whole mission in making these games was to get people to hang out and play together the way he did when he was a kid. That’s what he believes. It is working. I’m not a games person, but his games have made me have that experience that he was craving himself. I have a massive amount of appreciation for that. Even thinking back to like arcade games in the ‘80s, they were social for me. You and your friends would go and take turns. You’d watch your friends play on their quarter and you would go try and beat them on your quarter. You hang out together and even ride your BMX bike to the mall, play the game, talk about it and ride your BMX bikes home. It was very social in that sense. One of the things that I was excited to see develop in online games is that social component. I have such an appreciation for seeing the way people develop guilds in World of Warcraft, and hung out with these folks for years, and developed a leadership structure.

People are meeting their future spouses and getting married. That’s the thing that people who don’t appreciate games don’t understand. There’s a lot of things I think they don’t understand, but that in particular. The fact that you have whole communities forming where people who are isolated, they may live in a place where they have no friends. They’re alone. Imagine the only gay person in a small rural town, how isolated that person must feel or the only minority in a small rural town. Now, take that person and give them 10,000 friends in this game who they feel like they can be themselves around and develop a real relationship with. It’s magic. I used hyper-specific examples, but there are a lot of people who live in big cities and surrounded by others who still feel alone.

I grew up in rural Alaska and I was a computer nerd. That was not specifically a cool thing to be in those days, Revenge of The Nerds. Now it’s not so bad, but in those days, I felt super isolated. Nobody for a thousand miles was into the same things as me. It wasn’t until I got online. I didn’t have online games, but I had mainframes and I could talk to other people who thought computers were cool. That was a big change in my life.

My neighbor’s daughter met her boyfriend in Minecraft, and they’ve been together for three years. He doesn’t even live in the same state. That’s mind-boggling to me. That seems like something that as soon as it happened in college or after college. This is happening to high school students.

Thanks a ton. I appreciate it.

It was fun.

Important Links:

• Mightier
• Realm of the Mad God
• Wild Shadow
• Unity
• Triple Town
• Spry Fox
• Steambirds Alliance
• Alphabear 2
• Microserfs
• Swift Playgrounds
• DigiPen
• Rich Dad, Poor Dad
• The Diamond Age
• Scribblenauts
• 5th Cell
• PlayFab
• Throw, Throw Burrito

About David Edery

Co-founder & CEO of Spry Fox (developer of Triple Town, Alphabear, Bushido Bear, Steambirds, Road Not Taken, etc.)

Recorded on May 8, 2019

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