The MMORPG Chronicles of Elyria has a tumultuous history. Initially, it captivated many players with its unique concept, earning millions through crowdfunding. However, the studio later went bankrupt. Now, the CEO Jeromy Walsh explains how high the expenses really were and warns other indie developers.
How did the development of the game go? Chronicles of Elyria aimed to create a realistic fantasy world where your characters age over time. They would start to get gray hair, wrinkles, and eventually meet their final death.
- One life of your avatar should correspond to about one year in real life. After that, you would have had to continue with offspring or a new character.
- The MMORPG planned a free skill system with different types of weapons and armor.
- In addition, a highly detailed character editor, dungeons, and control over your own kingdom were promised.
The concept was well received, and the game raised over $1.3 million through Kickstarter in 2016. By 2019, a total of $7.7 million was reportedly raised, such as through the sale of a virtual advent calendar for $95 or other special actions.
On March 20, 2020, a pre-alpha of the game was released, which alarmed many fans: it had nothing to do with the described vision of a great MMORPG. The pre-alpha was, in hindsight, probably a last desperate attempt to convince someone of the project. Shortly thereafter, the layoff of many employees and the “near-cancellation” of the game was announced.
Walsh is now finishing the MMORPG alone – at some point.
CEO warns other developers of the costs after failure
What is the current situation of the studio? In the fourth quarter of 2022, the last full-time employee was laid off. Jeromy Walsh now works alone on the projects. He wants to first release a strategy game called Kingdoms of Elyria, which will contain part of the content from Chronicles of Elyria, namely the building of a settlement.
After that, the MMORPG is supposed to be financed through it.
Walsh regularly writes blog entries in which he reports on progress. However, the latest issue is about financing. He begins the blog post with:
I want to give current and future business owners – especially game developers – an understanding of the actual and hidden costs of running a small game studio (average of 17 employees). There are very few such breakdowns, so I hope this proves to be a valuable resource for others.
In it, he explains how the average costs of his studio were composed from 2017 to 2019. He excluded the years 2015 and 2016 because the studio had hardly any employees then, and from 2020 onward, he had to significantly reduce the number of employees, along with legal costs that he also omitted.
What were the millions spent on? A significant portion went towards employee salaries. This alone amounts to $3.5 million. With 17 employees, this averages to a salary of $68,000 per person per year. He himself paid himself $96,000 and was thus mostly, but not always, the highest-paid person in the studio.
In addition, there are
- Taxes for employees (including income tax, social security, and Medicare)
- and additional health insurance.
- Other significant cost factors were software licenses, hosting, and office costs.
Walsh also complains in the blog post about hidden costs in crowdfunding, including costs from the tax office because crowdfunding is not classified as investment capital, and constant renewals of copyrights as the game was not yet a finished product.
He warns potential developer studios about the costs of payroll tax and health insurance and ultimately regrets not having taken out liability insurance for Soulbound Studios, as there were various lawsuits in between.
“Not an intentional scam, but incompetence”
How are backers reacting to the blog post? To this day, many people who invested money in the game are angry at Jeromy Walsh. They have repeatedly accused him of fraud and wanting to line his own pockets. The content shown so far was simply too far removed from the actual vision.
The blog post has at least smoothed the waters somewhat for some. User Negnar-Holf writes:
I think the real insight here is – assuming these numbers are correct, and I don’t believe Jeromy is dumb enough to incriminate himself by publishing fake numbers – that Jeromy never intended to commit fraud (nor have I ever thought that). What I think is that he is an absolutely incompetent CEO who has no idea how to manage finances.
For this post, he receives a lot of support. However, some also wonder why Walsh chose to settle with an indie studio in Seattle, one of the most expensive cities in the USA.
However, this does little to change their actual criticism. They want a finished game for their money, and that is still far from being the case.
However, Chronicles of Elyria is not the only crowdfunding MMORPG that has failed. Here you can find more examples: 6 promising crowdfunding MMORPGs that have spectacularly failed
