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[GeoffW]

Hi,

If an indie developer makes a game and another person or company wants to buy the rights + code etc to port it to another platform (e.g. console or mobile), how might the developer work out how much money this is worth?  Can anyone think of examples of deals where this has been done or suggest things to watch out for?

As you may have guessed this is not entirely hypothetical, so any hints would be greatly appreciated!

[ANtY]

I guess that some amount of money PLUS ~30% of the port's earnings

amount of money depends on how much ur game can make though

[Klaim]

I have never been in this position but: how much do you need for your next game?

[VDZ]

Can anyone think of examples of deals where this has been done or suggest things to watch out for?

The original founders of Ronimo Games did this (before founding Ronimo Games) with their student project 'de Blob', which they sold to THQ. (THQ then released a remake plus a sequel to it.) Maybe you can try and contact them for advice.

[Mittens]

I would value it by how long I spent on it multiplied by an ideal wage, and yeah, like ANtY said, I think making sure you have an agreement for a cut of the ports earnings (royalties) is a really good way to make sure you aren't kicking yourself down the track when the port makes $billions$

[Muz]

Not an exact science.

Don't think about what you want, think about what they want. This can be extremely difficult to figure out, which is why they keep these things confidential.

If at all possible, get them to make the first offer. You might estimate your game at $10,000. They might value it at $5,000 or $100,000 (and offer you $4,000 or $80,000 accordingly).

Try to negotiate about 30%-40% higher than what they're asking, then drop your request to around 10% or 20% of it. E.g. if they offer $80,000, ask for about $110k, then after negotiations, let them get away with $90k.

Businesspeople often judge their skills by how much they can skim, so if you can, try not to negotiate more money. Ask for benefits, if possible, like press coverage, training, legal consultation, whatever that company has in abundance. I'm not sure if they would want to give a % of the earnings because of this, but no harm in trying.

Skilled negotiations will try their best to not give the first offer, though. So, just take your best estimate and ask for slightly higher. A newbie mistake would be to highball and ask for about double the estimated price to test the waters, but that would be insulting and probably end negotiations or get a hostile reaction.

[GeoffW]

Thanks for all the suggestions.  I've contacted someone at Ronimo Games but I'm not sure if they'll be prepared to tell me much.

A newbie mistake would be to highball and ask for about double the estimated price to test the waters, but that would be insulting and probably end negotiations or get a hostile reaction.

This is what I'm worried about - if I pick a figure myself I'm almost certain to be way off (higher or lower) what they think it's worth so I'll either lose out or, like you say, 'get a hostile reaction'.

It would be much easier to come up with a reasonable figure for a royalty percentage, but they've already stated reasons why they don't want to do it that way.

[ANtY]

It's fine to lose out at ur first time, it's just natural, then u'll have the experience

[Mister Dave]

Selling your IP eh? I'd never do that.

You should have a look at this company/person's body of work, try to find out what kind of success in terms of total sales they've had in the past and compare your property to that. If they have no history, then it becomes a bit more difficult.

Ask yourself why they want your IP. And then talk with your IP attorney (or get one if you don't have one). Your attorney should look over all deals for IP tranfers before you sign anything.

[GeoffW]

Selling your IP eh? I'd never do that.

No I'm not selling my IP, I'm talking about licensing it for particular platforms.

Ronimo Games have replied and were very useful, so my thanks to them and for the tip from VDZ.

[ANtY]

mind to share the advice they gave u?

[GeoffW]

mind to share the advice they gave u?

Well it was a private conversation, but these are some of the tips I've picked up after asking several people about it:

• As the seller it's better to start with a price that's slightly high rather than low, you can always lower your price but it's difficult to raise what you've already offered.
• If you can estimate profits (income minus costs) somehow, about 50% of that might be a reasonable starting point.
• Make sure the agreement is clear about what happens with things that might happen in future, such as sequels.

Muz's advice above looks pretty sound as well.