Business Entities (Continued)

(This post is an excerpt from the new edition of How To Make Your Own MMORPG which will be published soon!)

Limited Liability Company

Take the ease of setup from a partnership and the limited liability from a corporation, mix them together, and you get a Limited Liability Company (LLC). There are more steps, paperwork, and fees (several hundred dollars) associated with creating and maintaining a LLC (it can vary widely by state, so do a quick Google search for: form LLC + your state, e.g. “form LLC New York” in my case). The most attractive feature of this type of business is the fact that the owners, officers and directors are protected from the liabilities of the company. For instance, if a lawsuit was brought against your company, your personal assets (i.e. savings account, house, etc.) would be protected and only business assets would be used to settle the liability.

Pros of Limited Liability Company:

• Each member is protected from the liabilities of the company.
• It can continue to exist even if individual founders leave.
• Banks and other investors are more likely to provide funds.
• Corporate level income taxes are not levied.

Cons of Limited Liability Company:

• It can be set up only after abiding by the legal and corresponding state rules and regulations.
• Expensive to start compared to sole proprietorships or partnerships.
• A record for the entire year’s activity as to be maintained.

Choosing Your Business Model

So which model do you pick? If you are on your own, I’d start with a simple sole proprietorship. If you are starting up with a buddy or two, definitely look into forming a general partnership. If you have someone interested in investing, but who won’t be involved in the day-to-day operations of the business, consider a limited partnership. Finally, if you already have a successful game under your belt and are looking to grow (and perhaps add partners or investors), I would suggest that you start researching the requirements to form a LLC in your state.

Keep in mind that you can always “upgrade” at any time. Therefore, if you were to start as a sole proprietorship and decided to add a partner later, it would automatically become a partnership. You and your partner could then decide to form a LLC after successfully launching your first game. You aren’t “stuck” in the business model you start with, so I suggest starting as simple as possible so you can focus on creating awesome games!

Congratulations to Mark, winner of our NEaB game engine contest.

Mark is the owner of Ruler of Zu, a browser game set in ancient Sumeria, featuring dragons!

We are excited to see what Mark can do with the powerful NEaB game engine.

Don’t forget that we still have one more contest going on! There is still time to win a free copy of the MCCode engine!

You can check out the details of the contest HERE.

Again, a big thanks goes out to Alain Bertrand, the author of the NEaB game engine.

Business Entities (Continued)

(This post is an excerpt from the new edition of How To Make Your Own MMORPG which will be published soon!)

Partnership

A partnership is just what it sounds like; you have one or more partners who are co-owners of the business. As with a sole proprietorship, you and your partner (or partners) get all of the profit and also take full responsibility for any debt. However, just because you may split the profits 50-50 with your partner, does not mean that you are only responsible for 50% for the business debts. Each partner can be held personally liable for the entire financial obligations of the business. In other words, if your business owes some kind of debt, and your partner is unable to pay her half, you will be required to pay her portion. So needless to say, be very cautious who you go into business with!

There are two forms of partnerships: general and limited.

In a general partnership, each of the partners owns the business jointly. It does not necessarily have to be a 50-50 split; it is entirely up to you to decide who gets what share (I’ll cover establishing a partnership agreement later). As with a sole proprietorship, any profit gained by a general partnership goes directly to its owners and is taxed based on each of the partner’s income tax rate. The partnership itself is not responsible for any income or franchise tax.

A limited partnership is exactly like a general partnership with only one difference: there can be one or more “silent” (a.k.a. limited) partners. These limited partners own a portion of the business but don’t make business decisions and are not held liable for any business debts or other liabilities. One or more general partners are responsible for running the business and for all liabilities. Outside investors are often interested in limited partnerships since they can invest in the partnership without becoming personally liable.

As with sole proprietorships, partnerships are very easy to setup. In fact, you do not have to file any paperwork to create a partnership (you still need to file a DBA though), and there are no ongoing reporting requirements.

Pros of partnership:

• Easy to start and operate.
• Less expensive to start since partners can split startup costs.
• Risks as well as losses can be shared by all.
• More than one owner means more skills and resources are available.

Cons of partnership:

• Each partner holds the legal responsibility for the debts incurred by any other partner.
• Partners may leave or become unable to work, leaving the other owners liable.
• The more individuals involved in management, the more complex decision making becomes.

Once again, we are privileged to talk to another up-and-coming game developer.

This time we had the honor of interviewing Ralph Quito, creator of Townian (www.townian.com), a new strategy game similar to Tribal Wars, but with his own very unique twist.

Congratulations on releasing Townian! How long did it take you from start to finish?

Townian is based on an open source game script called Devana. I studied the script so that I can make custom modifications such as in design and function. I took me around 3 months studying the Devana script, and took me 2 months to fixed all bug and redesigned it. I also added some new functions such as the incentive system, referral system, forum for alliance, tax computation, dispatching of units, premium memberships, premium items etc.

What was the hardest part of developing the game?

Well, actually, familiarizing the script is the hardest part of it since you need to study the structure of it. Looking and fixing bugs is also a hard part in developing it. Designing the layout was also tough since it uses different css method.

Did you have to make any major changes or adjustments after the Beta test ended?

Yes, I had to adjust how population works. I’ve changed the population computation structure because it has so many conflict in computing tax, high score ranking, dispatching of units, and returning back units.

Do you have any additions or modifications planned for Townian?

Yes, I’m planning to add a hero system like Travian (but a unique one) and also add business system such as in the erepublik game. I want to make an all in one game, incorporating the best features of other games!

Your game has a very unique feature where your players can actually earn money by playing! Can you explain a bit how that works?

Yes, by this I will motivate players to login everyday in the game, its not really a big reward for those who play the game, Ill just gonna share some of the site’s revenue. Players can exchange their excess resources into real money and that makes us different than other browser games.

Visit Townian!

Hello everyone!

Today we at MYOM are very excited as the release date of the New Worlds Engine has been announced. As our readers know, we have been closely following the developments of this engine and we have had our chance to play around with it as well, I must say that Alain has done a fantastic job with this engine in terms of security, features etc. He has made a truly powerful engine.

The release date for this engine is: 21th March

One of my personal favourite features of this engine is the modular system this engine implements. Use of modular system means that the addition of a new module can be done by the click of a button and would not involve long process like editing files etc. I feel that this would make the entire engine a very clean system and at the same time prove to be a very powerful engine. This is just one of the many great features being implemented by Alain in this engine.

A demo of the engine can be found here: http://www.nw-engine.com/demo/

Please remember that this demo is not the complete engine yet as development is still under way. Also a few features in the demo have been disabled to stop anyone from spamming or causing any other types of trouble.

A full list of features can be found here: http://www.nw-engine.com/wiki/index.php/Main_Features

We at MYOM are very excited about this engine release and we are in the process of acquiring a pre-release license, what that means is that we will be the first ones to have our hands on this beauty of an engine, so keep checking our site for the first review of the New Worlds Engine.

Business Entities

(This post is an excerpt from the new edition of How To Make Your Own MMORPG which will be published soon!)

Now that you know you’ll be starting a business, you must next decide what form it will take. Your options include: sole proprietorship, partnership, limited liability company, and corporations (s-corp or c-corp). I suggest that you immediately rule out a corporation since it is overkill for a small development studio and would only make life more difficult. Instead, focus on a sole proprietorship, partnership, or limited liability company.

Sole Proprietorship

A sole proprietorship is the easiest business entity to start and the simplest to run. I highly recommend you start here. You still gain all of the benefits of operating a business and you avoid the majority of the headaches.

As a sole proprietor, you own 100% of the business which entitles you to all of the profits. This form of business can have several employees working for it but the ultimate management and administration rights rests with one single person who is the head of the business. As the owner, you are also held liable for all of the business debts. In other words, if you borrow money for the business, but the business cannot repay the debt, the lender has the right to go after your personal assets in order to receive payment. Obviously, you want to avoid this situation, so pay attention to the Funding section below to avoid any costly mistakes.

To put it simply, in the sole proprietorship form of business the owner himself invests all the required finances to begin his business and then enjoys all the profits gained (or if no profits are made, he is held responsible for any outstanding debts). As the owner of a sole proprietorship, you neither share your profits nor your responsibility for repaying debts.

Make Your Own MMORPG is delighted and honored to publish this exclusive interview with Dr. Richard Bartle, well known author of Designing Virtual Worlds, and a pioneer of the MMORPG genre.

We can’t thank Dr. Bartle enough for taking the time to share his insight and wisdom with us!

What one piece of advice would you share with a budding game developer looking to create a MMORPG?

It will take much longer than you think. Even after I’ve told you that it will take much longer than you think, and you adjust how long you think it will take, it will still take longer than you think.

What was the hardest lesson you learned while developing MUD?

Computers aren’t powerful enough to create a world rich enough to feel real. That doesn’t mean they’re not powerful now, just that they weren’t powerful enough in the late 1970s for us to do what we wanted to do with them.

In your opinion, what is the hardest part of developing a successful MMORPG?

Getting it to a stage when it can be launched. Actually having something you can invite random members of the population to play is a prerequisite to its being a success, but most MMORPG projects fail long before then.

What is your favorite part of MMORPG development?

Designing the world and the activities it supports. That early, pre-production phase is where you actually get to decide what you’re going to say to the players. The rest of it is where all the hard work is, but for me the world design is the reason to do it in the first place.

Do you currently play any MMORPGs, and if so, which ones?

I do, yes. Just yesterday I got my second level 50 in Star Wars: the Old Republic. I should add that I don’t play MMORPGs for the same kind of fun that players play them, I play them for “designer fun” when I play them at all. The only reason I didn’t close my SW:TOR account the moment I hit 50 (which I did with Rift and LotRO) is because I want to see where the first major patch (due in March) will take the game.

I also have 3 level 85 characters in WoW, but it’s so easy to get that nowadays that it’s not really all that impressive. I think I’ll probably cancel my WoW account later this year, as I haven’t touched it for several months.

Have you been recently involved in the development of an MMORPG?

I’ve been involved in the development of several, although it does depend what you mean by “development”. Normally, I’m called in to do something specific (steer a development team away from the rocks they’re heading for, for example, or provide input to an early-stage design), which means I am involved in development but I’m not doing any coding or direct content-creation.

According to the Bartle Test of Gamer Psychology, are you an Explorer, Socializer, Killer or Achiever?

I can’t answer the questions on that test. As I said, I’m a designer, not a player. Those questions are for people who play MMOs for fun. I don’t play MMOs for fun – well, not player fun. I’ve never played MMOs as a player; I’ve always played them as a designer.

You can ask a rich woman which pair of Jimmy Choo shoes she finds the most flattering or comfortable or provocative or way out, but you can’t ask Jimmy Choo that question.

Do you have any plans for a follow up to your highly acclaimed book, Designing Virtual Worlds?

Yes, I do. I’ve been writing one on and off for several years now, but I haven’t done much work on it in the past year. It’s like the MMO equivalent of the seminal “Computer Lib/Dream Machines” book that inspired so many programmers in the late 1970s. One half of it is about the wonders of MMOs, and the other half is about MMOs and their relationship to the real world. I’m calling the first half MMOs FTW and the second half MMOs WTF.

This interview was conducted on February 24th, 2012.