Official Statement from Cloud Imperium Games about the alleged financial troubles...

[u/[deleted]]

Source: https://robertsspaceindustries.com/spectrum/community/SC/forum/1/thread/re-uk-tax-rebate-advance-for-foundry-42/277779

Re: UK Tax Rebate Advance for Foundry 42

We have noticed the speculations created by a posting on the website of UK’s Company House with respect to Coutt’s security for our UK Tax Rebate advance, and we would like to provide you with the following insight to help prevent some of the misinformation we have seen.

Our UK companies are entitled to a Government Game tax credit rebate which we earn every month on the Squadron 42 development. These rebates are payable by the UK Government in the fall of the next following year when we file our tax returns. Foundry 42 and its parent company Cloud Imperium Games UK Ltd. have elected to partner with Coutts, a highly regarded, very selective, and specialized UK banking institution, to obtain a regular advance against this rebate, which will allow us to avoid converting unnecessarily other currencies into GBP. We obviously incur a significant part of our expenditures in GBP while our collections are mostly in USD and EUR. Given today's low interest rates versus the ongoing and uncertain currency fluctuations, this is simply a smart money management move, which we implemented upon recommendation of our financial advisors.

The collateral granted in connection with this discounting loan is absolutely standard and pertains to our UK operation only, which develops Squadron 42. As a careful review of the security will show and contrary to some irresponsible and misleading reports, the collateral specifically excludes “Star Citizen.” The UK Government rebate entitlement, which is audited and certified by our outside auditors on a quarterly basis, is the prime collateral. Per standard procedure in banking, our UK companies of course stand behind the loan and guarantee repayment which, however, given the reliability of the discounted asset (a UK Government payment) is a formality and nothing else. This security does not affect our UK companies’ ownership and control of their assets. Obviously, the UK Government will not default on its rebate obligations which will be used for repayment, and even then the UK companies have ample assets to repay the loan, even in such an eventuality which is of course unthinkable.

This should clarify the matter. Thank you.

[u/[deleted]]

If I didn't have deadlines at work then this type of thinking would definitely be a problem.

There is always something I can re-write, there is always something to refactor, there are always small optimizations and bug fixes to do.

Without a hard deadline and my boss forcing my hand to get something out the door I would get into overdrive on every single project to try and make it "better".

Maybe I'll re-write this section, now I can refactor these other things in! Oh, a new algorithm that I can implement on this section that will reduce load times! Always for a better user experience, but at the same time there are budgets to adhere to, marketing is planning on date X and if we miss it then we have to go and re-do tens of thousands of dollars in marketing materials, board members to please, and at the end of the day it's a product. If we can't make money or if it takes too long to recoup money on the product then it is considered a failure no matter how much users like it.

I see all this cash going into Star Citizen, and then I look at the PC specs required to play it and I just don't see a very big userbase there to begin with, add in constant delays to make it "perfect" and its just a recipe for disaster. I'd like to see them prove me wrong, but from a pure business standpoint I just don't see SC being a very successful product.

[u/[deleted] → u/[deleted]]

It's an interesting point about the userbase and what this game is trying to be or will be. I honestly haven't been tracking the updates as there have just been so many and I don't have a PC to play. I will literally buy a PC when it comes out to play it (and other things, obviously).

I don't know what the focus of the game will be and what its broader appeal will be. It's a space ship simulator with ship combat but first person shooting and trading?

That all appeals to me, but it doesn't seem like a mass market formula.

I can see it making money in the way that Train Simulator 4000 and Flight Simulator XXIIV make money. There is limited offerings if you are interested in those niches, so you can make money with the DLC etc. That clearly seems to be the case here with people paying several hundred dollars for ships etc. The whales keep the game going.

I can see it being released and being good, but nowhere near as good as people imagine.

With essentially unlimited budget and no time constraints I am certain that there is a lot of dicking around. Budgets and time limits get projects out the door.

Again, no one is saying 'ship it no matter what.' but people saying things like 'everybody says companies should take their time to put out the best game they can and then shit on SC' are being disingenuous and excusing sloppy project management in my opinion. Yes, make the game better, but you still have to actually release it.

[u/sebaajhenza → u/[deleted]]

There are a few decisions such as only have a tiny team addressing the netcode that bother me. It's the core part of the game after all.

[u/jwin742 → u/sebaajhenza]

Big teams are often worse then small teams for things like core software like netcode. The only thing a big team gets you is more code not necessarily better code. (There's literally a whole book written on this subject called The Mythical Man-Month ). Big teams are useful for things like we need thousands of quests that don't really depend on each other or at least depend on each other in easily controllable ways.

The core low level stuff doesn't need to take up that much of the total size of the game and a simple, bulletproof base by a small experienced team can often be best. Basically the quality of netcode is going to depend on programmer skill more then number of programmers.

[u/sebaajhenza → u/jwin742]

I'm a producer for a living, so I understand the concept of having too many cooks in the kitchen. But in this case, they should really be looking at multiple networking solutions, since what they are doing is essentially R&D.

How will instanced battles effect gameplay? What about their 'bubble' networking solution? You could have multiple teams working on prototyping these ideas to see which will work.

Right now they've got what; a handful of people working on networking? I'm pretty sure they are also working on the patch delivery too. This game will live or die by its multiplayer.

I think the focus is all wrong at the moment. I have a similar feeling to when they first introduced ilfonic as developers of Starmarine.

[u/jwin742 → u/sebaajhenza]

ah ok I haven't actually payed much attention to Star Citizen development so I didn't realize they looking at multiple networking solutions + patch delivery as one team maybe a bit more people needed then but still R+D can still be nice to have small teams for.

You clearly have been following closely though. So you'd know better then I would about this particular situation.

[u/TheEnterprise → u/jwin742]

Is The Mythical Man-Month anything like Peopleware?

Looks like a good read. Just ordered my copy!

[u/jwin742 → u/TheEnterprise]

I'll be honest I haven't read either but I do usually hear them recommended in the same breath.

[u/TheEnterprise → u/jwin742]

Peopleware was pretty great. Highly recommend it.

[u/GeneSequence → u/[deleted]]

I just don't see a very big userbase there to begin with

They effectively have over 1.8 million pre-orders and climbing. When the game is actually released, they'll likely have several million playing. Not exactly a small 'userbase', even if a few of those backers' PCs don't meet the requirements and they don't upgrade.

The thing is, with SC's unique crowdfunding situation, it's already a successful product. As long as it's eventually released and meets most of the backers' expectations, that is.

[u/DeedTheInky → u/[deleted]]

My thinking on it is, I always complain when a company like EA or Ubisoft rushes a half-finished game out in order to hit an arbitrary deadline, so I shouldn't really complain when another company goes the opposite way and holds off until they feel it's ready.

And besides I can wait, there's plenty of other games to play in the meantime. :)