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  • Clean up Contributions articles.
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  • Mail to Gaming Alexandria: Sega VR book, Nicole Miller items, GameWorks Vegas papers.

Rocket Science Games

Funding

  • 4mil: Initial funding gather (around January 1993)[1]
  • 10mil: Tokyo investment company (around July 1994)[2]
  • 12mil: Sega of America, Bertelsmann Music Group (May 1994)[3]
  • 5mil: Times Mirror (July 1994)[4]

Company

Background

  • Cassidy phrases this better than I will, but RSG (both the company and its games) was developed with making investors happy. This quote: "The CDROM content business in the early 1990’s was one of the many of the long line of venture capital fads. If you were a “with it” VC you needed to have a “Content” or “Multimedia” company in your portfolio to impress your limited partners – educational software companies, game companies, or anything that could be described as content and/or Multimedia."[1]

Beginning

  • RSG began with Barrett managing video game and development tools and Blank handling marketing and financing.[5]
  • When RSG was founded, Blank went out and spent a month or two talking to 14-22 year old gamers (their target audience). He then realized he lacked an emotional connection his customers or product, and that this should have set off warning bells. This section of his article is titled "What do you mean you don’t want to hear about features?".[6]
  • Despite the general hubris on RSG's part, Blank realized pretty early on that the company would need some high-level advice in the fields of technology, game development, and video game distribution if it hoped to be successful. To this end, he created an advisory board of specialists
  • At some point, RSG entered into an agreement with American print publisher McGraw Hill to publish strategy guides for their games.[7]
  • RSG had plans to distribute their games in Japan, or at least were selling the potential distribution rights. Despite a mid 1994 trip to Japan to meet with potential investors in person, however, the company was not able to work out any deals.[8]
  • Blank said he was upfront about his finances, and that every major decision was brought to the board ahead of time. This speaks to how many people in the company truly believed in what they were doing[5], and that claims of extremely few ppl in the company being gamers are true.[9][10]

MARKETING

  • The "Hollywood meets Silicon Valley" angle was easily digestible by the media, and this marketing angle ended up netting RSG stories in Fortune, Forbes, Variety, The Hollywood Reporter, among others.[5] According to Blank, "the theme of our press blitz was all about how we were going to show the old tired game companies the right way to make video games. Our press infuriated the established companies who had spent years building games that sold well, but had zero press recognition."[5]
  • At some point, RSG demo'd some of its games at a promotional event at the Playboy Mansion.[11]

TOOLS

  • RSG's actual business was to be split between games and software development tools. Per Blank, "A key premise of our new company was that our video compression and authoring technology would revolutionize how games were made and played. We believed that by putting full motion video (i.e. movies) into video games we could tell stories, build characters, have narratives and bring all the 100 years of craft and cinematic experience of Hollywood to the sterile “shoot and die” twitch games that were currently in vogue. (This wasn’t just some random Silicon Valley fantasy. My partner had convinced several major Hollywood names that this was the inevitable consequence of the merger of Hollywood and Silicon Valley. And at the time it was a plausible scenario.) But in reality our passionate belief that video would transform gaming was just our hypothesis. There was zero proof in the marketplace that was the case. And we weren’t going to be bothered to go out and prove ourselves wrong with facts. (Why should we – our VC’s had already told us what geniuses we were by fighting to even get into the deal to fund us."[6]
  • To expand on tool development, Blank states RSG was planning on producing an easy to use CD-ROM authoring system that would revolutionize how games were made, particularly through efficient video compression technology as a means of allowing all games to have that "Hollywood cinematic" feel. To this end, Peter Barrett had convinced several of the key members of the Apple Quicktime team to join. However, these plans never came to fruition, as by Blank's account, the company was so passionate about the development of the tools that it had never really asked itself why customers would want to buy their product in the first place.[6]
  • One of the company's tools, its "V3O technology", was eventually sold to Attitude Software and retitled "3D Anarchy", where it was sold again to Adobe and renamed "Adobe Atmospheres". The initial sale was sometime in 1996-1997.[12]

Decline

  • After the release failures, when Blank was seeking the next round of funding from his venture capitalists, they denied him. It was a trip to SF with two investors. I believe this may be the same investor who was quoted as "We sold to Sega for nothing". They liked how the business was being run, but stated "we realized that we’ve backed a business we don’t know much about, the company is a money sink and both our firms have no stomach for this industry.”[13]

Legacy

  • Blank admits that ignoring poor customer feedback, like that provided from the ex-SoA VP of Marketing he hired (Richard Burns), was one of his biggest mistakes in managing the company.[5]
  • "I had a public, humiliating failure, and still the people who lost the money had enough confidence [in me] because it was an honest failure" -Steven Blank. Blank later returned $1bil to his investors through his next startups.[9]
  • His investors, despite losing out on their returns, had promised Blank another $12 million in capital to start his next company. (WebTV?)[9]
  • By 1994, Blank had already launched and built six successful businesses, so his investors knew they'd most likely score another win.[9]
  • Blank states he learned three things from the failure of RSG: "get outside your office and test your product's viability with real customers", "ensure the executive staff and founders are aware of your product's viability", and most importantly, "no formal launch until you have early sales validating the product and sales process".[5]
  • On the topic of lessons learned, Blank: "I learned how to dial back the hubris, get other smart people to work with me – rather than just for me, listen better, and act and do what was right – regardless of what others thought I should do." and "For my next startup I parked the behaviors that drove Rocket Science off the cliff. We established a team of founders who worked collaboratively. When my co-founders and I got the company scalable and repeatable, we hired an operating executive as the CEO and returned a billion dollars to each of our two lead investors."[14]
  • Blank believes that if RSG had listened to early feedback and dialed back hype, they could have delivered truly great future games. Per Blank, "The huge mismatch between expectations and reality of our first games diminished the brand and demoralized the company – we never recovered."[5]
  • "I would get to use my marketing skills at generating an industry-wide reality distortion field to make this company look like the second coming. I was going to find out why this wasn’t a good idea." This perfectly sums up both RSG as a whole, and one of its biggest legacies: hype. Between boring games and low sales, the "RSG hype" was one of the single-largest in the industry, and needs its own section.
  • RSG would be Blank's first and last time acting as his startup's CEO[15], and says, "to this day I still can’t play a video game."[14]

Redirects to delete

References

  1. ↑ 1.0 1.1 https://steveblank.com/2009/07/02/rocket-science-2-drinking-the-kool-aid/ (Wayback Machine: 2022-10-05 01:41)
  2. ↑ https://steveblank.com/2010/02/01/incentives-and-legends/ (Wayback Machine: 2023-02-07 17:49)
  3. ↑ https://www.wired.com/1994/11/rocket-science/ (Wayback Machine: 2023-01-17 02:45)
  4. ↑ https://www.latimes.com/archives/la-xpm-1994-07-26-fi-19960-story.html
  5. ↑ 5.0 5.1 5.2 5.3 5.4 5.5 5.6 https://venturebeat.com/entrepreneur/youre-not-as-good-as-the-press-thinks/
  6. ↑ 6.0 6.1 6.2 https://steveblank.com/2009/07/09/rocket-science-2-hollywood-meets-silicon-valley/ (Wayback Machine: 2022-12-07 00:55)
  7. ↑ https://www.abandonware-france.org/compagnies/mcgraw-hill-620/ (Wayback Machine: 2021-09-26 01:29)
  8. ↑ https://steveblank.com/2009/12/03/someone-stole-my-startup-idea-–-part-1-are-those-my-initials/ (Wayback Machine: 2022-12-16 22:24)
  9. ↑ 9.0 9.1 9.2 9.3 https://www.inc.com/zoe-henry/how-steve-blank-lost-35-million-and-bounced-back.html
  10. ↑ https://www.inc.com/magazine/19940401/2864.html (Wayback Machine: 2022-05-27 06:10)
  11. ↑ https://www.linkedin.com/in/greg-orr-112b3a36/details/experience/
  12. ↑ https://phoenixtoews.net/phoenixcv (Wayback Machine: 2020-11-21 14:44)
  13. ↑ https://steveblank.com/2011/02/03/vc’s-are-not-your-friends/ (Wayback Machine: 2022-12-25 12:05)
  14. ↑ 14.0 14.1 https://steveblank.com/2013/02/26/failure-and-redemption/ (Wayback Machine: 2022-11-24 02:16)
  15. ↑ https://steveblank.com/2009/02/23/out-of-the-ashes-something-isn’t-quite-right/ (Wayback Machine: 2022-12-16 22:24)
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