Seriously we need CCP annual report

[Herschel Yamamoto]

http://www.eveonline.com/ingameboard.as ... ID=1541148[/url]

Hershel damn it they could have come up with interesting new ideas and you had to ruin it.

I'm just trying to be helpful...

Added a note about how people should read it themselves if they have the mind to. The simple shit's not going to change with more eyeballs, so there's no harm in saving them the read. Any of the non-obvious stuff isn't going to be found by people who want a tl;dr anyways.

[The Crushah]

We should create an investment group, and offer to pay of their loan in exchange for an equity stake in CCP. That would guarantee you a seat on the board and probably a role in the decision making. Of course the other investors would likely have to sign off on that.

Would be interesting if the players could raise the appropriate money through an IPO. Kinda like the Green Bay Packers.

Can't do it.

Quickest answer is that in the US private companies can only raise money from "qualified investors". These are people with >$200k in income for each of the last 3 years or those with >$1M in financial assets (your house doesn't count).

There are also strong rules as to how you go about asking for money from these qualified investors. On top of which, if you go over 500 shareholder you have to report to the SEC in the same way that you would as a public company.

You also could not do this in less than 6 months.

Can you invsion a scenario where a player or players could intervene, buy a stake in the company, somehow influence CCP management? Not that I think the screaming mob really has any clue about bizdev or running a company. I just saw their debt as a way to convert to an equity stake.

[dzajic]

Lets say we can get 50,000 people to donate. It would take $200 per donator to get needed 10 mill. And then CCP becomes first gaming company in history to be partially owned by its own :lolcustomers:

But. How could it be organized; we are talking about IRL investments and legal obligations? What model did UK football fans use in several cases to buy into their clubs? Just setting up the appropriate infrastructures to start "EVE Bittervets Ltd." would someone (tens of)thousands of $$$. How to make it work; how to make it not a IRL money scam? At such large sums of real cash I wouldn't trust nor Chribba nor anyone.

Too complicated. Too open for IRL $$$ scam. Would take too much IRL :effort: and $$$ just to set up.

Still. Its a awesome dream.

[Ash2k7]

[quote=The Crushah]

We should create an investment group, and offer to pay of their loan in exchange for an equity stake in CCP. That would guarantee you a seat on the board and probably a role in the decision making. Of course the other investors would likely have to sign off on that.

Would be interesting if the players could raise the appropriate money through an IPO. Kinda like the Green Bay Packers.

Can't do it.

Quickest answer is that in the US private companies can only raise money from "qualified investors". These are people with >$200k in income for each of the last 3 years or those with >$1M in financial assets (your house doesn't count).

There are also strong rules as to how you go about asking for money from these qualified investors. On top of which, if you go over 500 shareholder you have to report to the SEC in the same way that you would as a public company.

You also could not do this in less than 6 months.

Can you invsion a scenario where a player or players could intervene, buy a stake in the company, somehow influence CCP management? Not that I think the screaming mob really has any clue about bizdev or running a company. I just saw their debt as a way to convert to an equity stake.[/quote:2jq1thgq]
Sure, but they'd need to drop a rather large amount of money on the table. Think $20-30M, which is what CCP needs over the next 3 years.

Except for Russian Aluminum Billionaires, that's kind of a large amount of money to spend on Internet Spaceships.

Quick send Bill Gates' kids some time codes and the details of some unsubbed bittervets (so that they can play with the awesome end game toys tomorrow).

[Ash2k7]

Lets say we can get 50,000 people to donate. It would take $200 per donator to get needed 10 mill. And then CCP becomes first gaming company in history to be partially owned by its own :lolcustomers:

But. How could it be organized; we are talking about IRL investments and legal obligations? What model did UK football fans use in several cases to buy into their clubs? Just setting up the appropriate infrastructures to start "EVE Bittervets Ltd." would someone (tens of)thousands of $$$. How to make it work; how to make it not a IRL money scam? At such large sums of real cash I wouldn't trust nor Chribba nor anyone.

Too complicated. Too open for IRL $$$ scam. Would take too much IRL :effort: and $$$ just to set up.

Still. Its a awesome dream.

Also massively illegal.

[Holy One]

I asked my accountant chum if he'd cast an objective eye over the document you linked. Here's his 'short n sweet' summary:

Fairly bog standard set of IFRS accounts however there are some very interesting things going on here.

CCP have made reasonable profits for each of the last two years, $5.4m and $6.0m. They have also managed to increase their cash reserves by about $6.5m during 2010. Also they have settled a loan that was hanging over their heads. Not too bad at first glance.

Alarm bells start ringing to me on page 21 (I must admit that I skimmed the first few pages as numbers confuse me sometimes - reading the notes to accounts is often much more interesting). CCP are spending around $30m on staff costs and capitalising more than half of them circa $16m. What does this mean? It means that any capitalised costs are being dumped into the balance sheet and not being immediately recognised in the profit and loss acount. This in itself isn't illegal by earmarking it as research and development cost. But it is a whopping amount.

I then turned my attention back to the balance sheet. These R&D assets total $54m and are being released to the P&L over four years. "Amortization of capitalized development cost in 2010 is almost exclusively due to EVE Online" - presumably this represents the investment in Incarna/Dust. Now the catch with these kind of capitalised labour costs is that an impairment test must be done every year. Sounds more technical than it is; in practice it means that if a project is no longer viable then the company would no longer be entitled to carry on its balance sheet any capitalised costs. If this were to happen to CCP, then the consequences would be disastrous all those profits would be wiped out and the company would be technically insolvent. So it does take a lot to imagine what kind of pressure the auditors would exert (if they have any integrity) once subscriber numbers start dropping...

I turned my attention back to the cashflow statement. The company's operating cash flow is actually negative. The cash it has generated during the year has mainly come from new share issues. In fact the loan appears to have been settled via some kind of stock issue. It's all very well having $11m of cash in the bank but it you are pissing it away at $7.4m per year you arent going to be in business long.

So without being able to see what has happened so far in 2011, I would say alot is riding on the success of the Incarna and Dust 514. It would be interesting to see how much, if anything, Sony have paid for the exclusive licensing of Dust. If Incarna fails and/or if Dust gets delayed then it could be curtains for CCP.

[Herschel Yamamoto]

The biggest forum thread in Eve history just hit 12000 posts, and only 3679 unique authors. How exactly do you plan to magic up 50k people with the means and willingness to invest $200 each to invest in this game?

[dzajic]

OK, since I know that something like : "What model did UK football fans use in several cases to buy into their clubs?" actually happened, I'm certain I remember hearing it on news... Anyone know how did that work, there is obviously some legal and non-scammable way?

[Vilgan]

I wonder how much they could save if they fired the following:

Everyone on the web development team (including the Eve Gate folks)
Everyone who is native to Iceland who hasn't done shit other than knowing the right people


The buying a stake in the company thing is kind of fun in theory, but ridiculous in reality. 1) the players frequently will want things that are bad for the game as a whole (as long as it benefits them in some way) and 2) Having experienced CCP for the past x number of years, who in their right mind would recommend investing personal or friends/family money in CCP? Usually people who have large sums of money are smart with their money and have it for a reason. Also there is the whole practicality of doing it in the appropriate timeframe that Ash2k7 mentioned.

[Joshua Foiritain]

The biggest forum thread in Eve history just hit 12000 posts, and only 3679 unique authors. How exactly do you plan to magic up 50k people with the means and willingness to invest $200 each to invest in this game?

spam jita local?

[Ash2k7]

OK, since I know that something like : "What model did UK football fans use in several cases to buy into their clubs?" actually happened, I'm certain I remember hearing it on news... Anyone know how did that work, there is obviously some legal and non-scammable way?

UK has a special structure for football clubs. This is not broadly applicable to all businesses and gets very complicated when you have a large US revenue and operational presence.

[Herschel Yamamoto]

Also, what's with this "it's illegal to buy a private company" jazz? Qualified investors are only needed for hedge funds. It's fairly logistically difficult to get mass ownership without being listed on a stock market, but I'm not familiar with any laws prohibiting it.

[quote=Joshua Foiritain]

The biggest forum thread in Eve history just hit 12000 posts, and only 3679 unique authors. How exactly do you plan to magic up 50k people with the means and willingness to invest $200 each to invest in this game?

spam Jensius local?[/quote:nqj1zqft]

There's maybe 1000 people in Jita usually. Of them, 800 never read local, 100 are either ctrl-V only or outright bots, and 80 will block you. Have fun with that.

[The Crushah]

I wonder how much they could save if they fired the following:

Everyone on the web development team (including the Eve Gate folks)
Everyone who is native to Iceland who hasn't done shit other than knowing the right people


The buying a stake in the company thing is kind of fun in theory, but ridiculous in reality. 1) the players frequently will want things that are bad for the game as a whole (as long as it benefits them in some way) and 2) Having experienced CCP for the past x number of years, who in their right mind would recommend investing personal or friends/family money in CCP? Usually people who have large sums of money are smart with their money and have it for a reason. Also there is the whole practicality of doing it in the appropriate timeframe that Ash2k7 mentioned.

With the development of DUST and WoD, you could take the same approach that a lot of biotechs do towards drug development. Build up your R&D divisions until your drug is approved, then fire them all and replace them with drug salesman. One could argue that half the employees arent really needed once the game is released. Maintain your portfolio of 3 games for a year or two until your balance sheet improves, then hire back all your developers to start the next project.

[Ash2k7]

Also, what's with this "it's illegal to buy a private company" jazz? Qualified investors are only needed for hedge funds. It's fairly logistically difficult to get mass ownership without being listed on a stock market, but I'm not familiar with any laws prohibiting it

Derp

Qualified investors are needed for all un-registered securities (with an exception for employees and friends&family). Hedge funds, VCs, Private Equity, etc.

You can not get mass ownership without registering with the SEC - 500 shareholder rule.

There also very, very strict rules as to how you solicit investors for unregistered securities.

[Cogs]

my accountant chum
[quote:ws2ihz5n]I skimmed the first few pages as numbers confuse me

[/quote:ws2ihz5n]
An accountant that gets confused by numbers?

[Joshua Foiritain]

[quote=Herschel Yamamoto]Also, what's with this "it's illegal to buy a private company" jazz? Qualified investors are only needed for hedge funds. It's fairly logistically difficult to get mass ownership without being listed on a stock market, but I'm not familiar with any laws prohibiting it.

[quote="Joshua Foiritain":dzsykz9m]

The biggest forum thread in Eve history just hit 12000 posts, and only 3679 unique authors. How exactly do you plan to magic up 50k people with the means and willingness to invest $200 each to invest in this game?

spam Jensius local?[/quote:dzsykz9m]

There's maybe 1000 people in Jensius usually. Of them, 800 never read local, 100 are either ctrl-V only or outright bots, and 80 will block you. Have fun with that.[/quote:dzsykz9m]
It was a joke

Why the fuck would anyone include jitards in this?

[Holy One]

my accountant chum
[quote:k87plbpq]I skimmed the first few pages as numbers confuse me

An accountant that gets confused by numbers? [/quote:k87plbpq]


Good init. He handles all my offshore assets.

[Goumindong]

Note that EVE still looks to be a cash cow. So if worse does come to worse they could probably axe half the company and go from negative to positive cash flow overnight. Its not like half of those people are working on EVE anyway.

[Riithi]

Hubris comes before the fall it seems... seems making three games at the same time broke the goose it's back.

[Obic]

So in sum, CCP has the expenses of 3 products, but the income of only 1, and are (only) burning 5-10 mil a year.

That's actually not too bad. It won't take Dust or WoD being massive hits to bring CPC into the black. As long as *both* don't bomb CCP shoudl be ok. Also CCP is very important to the overal icelandic economy, being one of the fw stable sources of hard currency, so i wouldn't worry too much about the auditors :P


Edited to add: Eve development is mostly in iceland and costs Krona which is very cheap, while income is in (comparivly stable) currencies so that makes Eve only look even better. WoD and Dust expenses are in Shanghai and Atlanta and therefore much more expensive than Iceland development. If CCP moves developers from Atlanta (USD) or Shanghair (RMB) to iceland they'll pretty quickly go cashflow positive.