Bad IdeasBusinessGames

Rhode Island Taxpayers Lose $75 Million Trying To Make A Video Game

Last Thursday, Rhode Island-based 38 Studios laid off its entire staff of nearly 400 people, which presumably included many artists and animators. The unceremonious layoff notice sent to their employees can be read on Gamasutra.

The game studio was started by former baseball player Curt Schilling, and had received a $75 million loan guarantee from the state of Rhode Island (population 1 million), which gambled that Schilling’s company would bring high-paying tech jobs to the state. The company managed to slip out one game before collapsing, Kingdoms of Amalur: Reckoning, which both looks and sounds like the creation of a sweaty-palmed, pimple-faced high school student.

Amalur shipped 1.2 million copies in its first 90 days (according to Schilling). The governor of Rhode Island, Lincoln Chafee, said in a press conference a couple days ago that the game would have needed to sell more than twice as many copies just to break even.

There’s a lot of lessons to be learned here, the first of which would be that just because you know how to throw a ball doesn’t entitle you to tens of millions of taxpayer dollars so that you can pretend to run a video game technology company. Schilling just made it that much harder for legitimate video game entrepreneurs to receive any type of investment for their companies.