Best of British: Four Door Lemon lift the lid on the pitfalls and practicalities of work for hire

Simon Barratt is the owner of Four Door Lemon Ltd, an independent games developer based in the UK.

2013 marks an interesting change of direction for Four Door Lemon as we switch from being a service company – providing work-for-hire (WFH) full project work and consultancy – to acting primarily as a self-publishing independent developer.

I say primarily because we feel there are still many interesting things about partnering with other companies and working with their IP, even if ultimately it may be a traditional work-for-hire arrangement.

I'm going to explore the pros and cons of both WFH and working on your own IP and share a few useful tips we've picked up regarding both approaches.

Will code for food!

We've done a lot of WFH. We've completed short optimisation projects to make certain algorithms run faster on specific target platforms, added networking support to game modes, and carried out various full game productions.

Some of these are initiated by the client and we're provided with a specification. Others are via a Request For Proposal process.

Obviously, WFH comes down to charging for services to be performed. However, on medium to large scale game projects, it will typically be a fixed fee that is agreed based on estimates.

These projections draw on the original specification along with discussions around the available budget, which can be used to determine where to pitch the amount of features and content.

Fixed fee can be risky, particularly on more complex projects or projects that are open-ended in various ways. For example, it may be that you need time to find the fun and there is an unknown amount of time required for this.

Or it might be that R&D is needed to work out the exact approach to be taken on a specific area of the final product.

It's worth noting that, for this reason, it's important to have a strong change control process in place from day one so that the client is aware when things are heading towards additional budget or resources required.

But the benefit of fixed fee is that if the project can be estimated well – which is more likely if your team has prior experience on that genre or on a particular system – then the profits can be higher than charging for time.

All things considered

Ideally on projects that are hard to define or you expect to have changing requirements, a suitable day-rate is agreed in advance, building profit margin into this if required.

Ultimately with all projects it is important to ensure you're charging enough to cover costs.

This must include the initial business development, pitching and legal costs of getting a project sealed as these are easily forgotten and are often not spread across the rates that people charge.

This is even more important when performing shorter projects, as the kick-off costs stack up more quickly.

Beyond the finances of a project, however, it is important to look at the other value that you gain from working on a particular project, especially if you are fortunate enough to be in a position to choose which project you proceed with.

Are you able to use the project to add to your team's portfolio? Is the game using technology you want to investigate yourself and thus the project is providing an opportunity to do that? Does the project allow you to sharpen some skills, or approach things in a different way to how you usually would?

Can you learn from your partner on the project, and is there an opportunity to have a royalty share and create an additional revenue stream?

Whatever the additional value you're getting is, you should be sure to be completely open with the client so they understand what your aims for the project are beyond the successful completion of it.

Openness and transparency on projects can be very scary at times but always benefit the project and all parties.

Legal eagles

The other area in which it's important to be completely open is the contract negotiation.

It's important to have a good and experienced legal representative working with you, ideally someone who has worked with the client before and is aware at some level of how they work with people.

You should also ensure that the change control process mentioned above is sufficient, and that any cover for cancellation that is out of your control protects you financially.

I previously mentioned that we still have a strong interest in WFH and this relates to the value part of the equation – there are some IPs and teams that we would love to work with, and the only way we could do this is through WFH.

Fundamentally, with WFH you can have a very successful business doing these projects and can get to work on interesting games, technology and with brilliant people while making a steady profit.

But unless you get an amazing deal or success it's unlikely you will make a lot of money to invest into your own projects without massively scaling up the team or getting yourself into an irreplaceable position with a partner.

Part of this tends to be because things will go wrong on projects, often through events that are out of your control, but which still eat into the profits of better performing projects.

I'm working on a novel…

Getting a game prototyped, developed, polished and released in 2013 is an incredibly simple thing to do.

With the availability of multiple free and cheap technologies, the focus comes down to producing a great game experience and hitting the submit button on your chosen store.

Of course due to the ease of this process, as has been discussed on these pages many times before, discoverability is a huge problem on all platforms. Even a great game timed badly and marketed insufficiently can completely fail to break even for developers and publishers of all sizes.

There are several major attractions to developing your own IP – ownership and control being two of the biggest.

When you're working with your own IP, whether you're successful with the initial release or not, the game and its assets belong to you.

You can attempt a relaunch, port it elsewhere, license the game to someone else, be paid by another platform holder to port to their platform, license another brand on top of, develop complimentary products, iterate on and try a new business model or any of the other avenues.

All the value (monetary or otherwise) generated from these activities belongs to you forever and stacks up with other projects.

Finding the funding

But the difficult part in the first place (especially as an established company with business overheads, offices and a complement of full-time staff) is making sure you can fund the actual development and then bridge the funding gap between the end of the development and receiving the first funds.

This gap could be as much as 90 days after release, assuming that you don't need to repay an investor or other third-party first.

So although we have advantage of established processes and other projects on-going, in some ways it's a lot easier starting up as a fresh team with low costs and using the available tools to quickly get your game up and running.

In an ideal world, funding to cover development would come from previous funds built from work-for-hire or existing releases. If this isn't feasible, then there are several funds available if you're able to meet the application requirements and nail the pitching process.

You could investigate the Abertay Prototype Fund, SMART grants for specific technology / product R&D, project or VC investors, traditional game publishers, software + hardware platform holders, Indie Fund and of course crowdfunding.

In other words, there are right now plenty of places to raise funds right now – you just have to be able to market and present your project successfully.

Marketing is a very important part of this approach and it is an area we're trying to ensure we get spot on with our next project.

We've learnt a lot of lessons on our previous titles whether we were in charge of the PR/marketing approach or not, and my main tip for this would be to talk as much as possible to other teams you've seen do this successfully to similar target audiences.

The perfect balance?

As the focus of Four Door Lemon shifts slightly this year and early next, we'll be working out what balance we want to strike between WFH and our own projects.

Some teams strictly alternate between a big WFH project and a project of their own. Others will always have two or more teams split over an internal and external project based on a percentage of the team size or dedicated budget.

For us right now, we're dedicating ourselves to making our first major product a success, but that won't stop from exploring opportunities to partner with other indie studios.

These arrangements are ultimately a chance to offer value, while hopefully learning something at the same time.

You can find out more about Four Door Lemon on the company's website or follow Simon on Twitter.