Fine Print: How it all Works

I came up with our revenue sharing method a couple of years ago for my unconventional game studio: CLASSEGAMES. Essentially, everyone who works on a game with AirCollaborate and completes the work they agreed to do will recieve an agreed upon percentage ownership in the product being produced. We have no employees and no contractors; just part owners. I have spent much of my career working on games that made other people lot's of money. I spent a long time thinking about how to make a fair arrangement where everyone gets rewarded commensurate with the work they contribute to a project.

Every game design is unique and may present unusual challenges. So every product we undertake at AirCollaborate is fully designed and the required work is planned out prior to anyone beginning work on anything. That way everyone knows exactly what they are commiting to accomplish and what their percentage of ownership will be for accomplishing it. Earned revenue from AirConsole will be requested for payout at the end of any month where it exceeds $250. Royalty payments will be forwarded on to our partners within two weeks of reciept of funds from AirConsole. We use PayPal to transfer funds.

Our games are made by groups of like-minded programmers and artists who share the risk and share any profits. It is a great way for new game developers to get some experience and build a portfolio, all while becoming part owner of a commercial product! It is also a great way for experienced developers to concentrate on the parts of development where they are most skilled and let others with different skill sets take care of the other parts. The agreement we use to work together is simple. For each game there is a primary developer, partner developers, and apprentice developers. Each of these roles is different, so we should probably define each role.

Primary Developer

The primary developer is the owner of the game. The primary concept and design of the product is their creation, and they foot the bill for assets needed during production, publishing costs, and promotional expenses. Typically the primary developer will create a majority of the product themselves, and they have the ultimate say in what parts they are willing to outsource to partner developers. They will be the financial entity to recieve the income from any sales, and they will be responsible for paying royalties to all partner developers monthly and to apprentice developers annually. As the publisher of the game, the financial risk and any liability lies with them alone. For the purpose of this context, the primary developer will always be Paul McCarl doing business as AirCollaborate.

Partner Developer

Partner developers are individuals with the skill and expertise to contribute in a significant way to the development of the product. The primary developer will contract with them for the creation of some portion of the game. Both parties will agree to a timeline for the creation of that portion and a value in ownership percentage that will be earned upon completion. Partner developers are responsible for maintaining the portion of the game they contracted to complete for the life cycle of the game. If they are unable to complete it in the time alloted, the primary developer can cancel the contract or grant a time extension at their discretion. If the contract is cancelled, the hours invested by the partner developer will be entered as apprentice hours and will earn a share of revenue with the other apprentice developers. Partner developers do not contribute financially to the costs of development.

For instance, lets say that Partner Developer A completed the track editor for a racing game under a contract valued at 10% ownership and Partner Developer B completed the network multiplayer engine for the same racing game under a contract valued at 25% ownership. In a particular month, the net profits generated from the game amounted to $1,000. Partner Developer A would recieve $100 that month, and Partner Developer B would recieve $250 that month. If the monthly revenue was ten times larger, then the revenue paid to these partners would also increase ten-fold; however, if the revenue was only $10, then their payouts would be only $1 and $2.50. Which is why we only request earned revenue once it exceeds $250. It is important to remember that many really awesome indie games have been commercial flops! Sometimes a game can take a while to catch on, as well. Our experience has been that every quality product builds revenue over time on AirConsole.

Apprentice Developer

An apprentice developer is an individual who wants to learn how to make video games, but may not be ready to take on creating an entire sub-system of the game by themselves. Apprentices will be given opportunities to work in various ways to assist the primary and partner developers. Apprentices will keep track of the time spent on the project and will earn a share of the revenue based on the hours they and other apprentices put in during the development cycle. As part of this cooperative development method, 5% of the profits from the product are set aside for the apprentice developers who work on the game. Because each apprentice may have varying skills and abilities, the time they spent working on the game will be the measure of their contribution. An apprentice developer's revenue share will be determined by the hours they put into the project versus the total hours put in by all apprentice developers involved.

For instance, lets say that Apprentice Developer A worked on our racing game a total of 10 hours and all of the apprentice developers together worked for a total of 100 combined hours. In a particular year, the net profits generated from the game amounted to $10,000. The total payout due to all apprentice developers would be $500, and apprentice Developer A would recieve $50 that year. If the annual revenue was ten times larger, then the revenue paid to the apprentices would also increase ten-fold; however, if the revenue was only $10 for the quarter, then the apprentices' total payouts would be only $0.50 and Apprentice Developer A would only get a nickel! The apprentice payouts are simply a "thank you" for helping out where you could. The real payout for our apprentice developers is in building their skills by working with successful professionals on a commercial game. Your portfolio will look better with credits on published products.

As I said before, each product and its revenue sharing will be unique; however, the games we target through AirCollaborate often have similar needs. A rough percentage of the revenue shares on a typical game might look like this: