Co-Creator of Exploding Kittens — How to Raise Millions on Kickstarter | Elan Lee | Transcription

Transcription for the video titled "Co-Creator of Exploding Kittens — How to Raise Millions on Kickstarter | Elan Lee".

1970-01-01T03:19:13.000Z

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Introduction

Start (00:00)

Hello boys and girls, ladies and germs. This is Tim Ferris and welcome to another episode of the Tim Ferris Show, where it is my job to deconstruct world-class performers from all different disciplines. Could be chess, could be military. In this case, it is games. All things gaming, my guest today is Elan Lee. You can find him on Twitter @Elanle, E-L-A-N-L-E-E. Elan is the co-creator and chief executive officer of Exploding Kittens. Maybe you've heard of it, a leading gaming and entertainment company. Under his leadership, Exploding Kittens has expanded its portfolio to nearly 30 different games with more than 20 million games sold in more than 50 countries since its founding in 2015. Before founding Exploding Kittens, Lee was the chief design officer at Xbox Entertainment Studios, where he led the Interactive Entertainment portfolio. Prior to that, he was the founder and chief creative officer of Fourth Wall Studios and co-founder of 42 Entertainment. He began his career at Microsoft Games Studios as a lead designer on the original Xbox. Lee has won a primetime Emmy for the series Dirty Work, Game Innovator of the Year for Exploding Kittens, a Peabody Award for the world's first alternate reality game, The Beast, and an indicated Trailblazer Award for a distinguished career in Interactive Entertainment, among others. Elan, welcome to the show. Nice to see you. Thanks. It's really good to see you too. I'm happy to be here.


The Journey Of Game Development And Marketing

Poetry For Neanderthals and collaborating with creative cohorts. (01:30)

So, to paint a picture for folks, downstairs, I have what should function as a dining table, completely covered in games of every imaginable type, and the floor is further littered. There are dice everywhere. There are blank dice everywhere. Cards. There are blank cards. So, I'm in the midst of immersing myself in all things, specifically tabletop gaming. And I want to thank you because of all the games tested so far, one game has stood out as a friend favorite, and that is poetry for Neanderthals. And there are people out there who will catch me on Neanderthals and find, I'll say it both ways for you. Yeah, we asked for that one naming that. Fair enough. Yeah. So, I'm hoping we could start because I've listened to quite a few interviews with you. And there are other places where some of your bio has been covered in, I think, a very, very good fashion. I recommend people listen to think like a game designer in the episode that Justin Gary did with you as well. But why don't we start? Because I found a video online which was you interviewing two game designers who worked on hand-to-hand wombat. And I found that short conversation so incredibly helpful with the nitty gritty of seeing how the sausage is made. I was hoping that perhaps we could start with poetry for Neanderthals as a case study. Yeah. From the very inception. And you could just walk us through it. Yeah, absolutely. So, poetry for Neanderthals, it didn't even have a name. Of course, no game has a name when you start. But that one came to me from some friends. I met Jacob and Francesca at this conference. And they came to me and they're like, "Okay, you're the exploding kittens guy. We got this really cool idea. What if there was a game where you had to learn a new language? And you're really bad at that language. You're in a foreign land. Everyone speaks the language except you and you've got to try to get by." And they said, "The way that we can simulate you not speaking the correct language is you have the restriction every sentence you speak, every word in that sentence must be a single syllable word." And they gave me some examples. They're like, "Okay, so now listen, you, Elan, you have to say, I'm really hungry. I want to go to the store, but there's a dragon at the store that's really scary and I don't know what to do. Go." And I'm like, "Okay, okay, sure." "Me want to go get food." And immediately I realized, "Oh, I sound like a caveman. That's kind of fun. That's, you're right. You have simulated this environment where I don't speak the right language." And so we started working together and it took about a year of playing around. We got another designer involved a guy named Brian Spence and realized there's something super fun here. Like there is a core gameplay loop. There's something that every time people touch it, every time they play around with it, they start laughing. They start wanting to tell their friends about it. But holy crap, those sentences, they are mouthful. And so we took the sentences down to like five or six words, still too much. We took them down to three words, still too much. So coming down to two words, still too much. And we finally realized like, "Why are we complicating this? What if the entire game was get your friend to say this word using only single syllable words?" And that was it. Once we realized that we were bringing baggage through for no reason, the game got really simple, really fun. My co-founder and business partner Matt Inman, who is the creator of The Oatmeal, he took one look at it and said, "We're calling this thing poetry for Neanderthals." And suddenly we had a game. It was really like those steps in that order that let us push that thing out the door. And could I just maybe give a layman's take so people can envision what this game looks like? So I played it with two other friends. It was the three of us. And I actually, we did a lot of trial and error. So I think we also did some experimental work just in terms of how to optimize for three people. But imagine that you have one person who is the caveman or cavewoman, they have these cards. And you flip over the card and at the top you have ghost, let's just say, as an example. That's, and that will get you one point if you can give cues in these monosyllabic words. Only you can see that word. Nobody else can. Yeah, that's right. Only you can see the word. And so you might say, "Dead man." It starts to get hard very quickly. Yeah. And if you get that right, now you can say the word "ghost." You're allowed to say that. And so the three point, which is the three point option below that might be ghost town, let's just say. And there is a hourglass that is turned over, which gives you, I think it's maybe 60 seconds. Yeah. It's something like that. To rack up as many points as possible. Usually you do this in teams. If you break the rules and you say something like, "Casper," there's somebody with an inflatable club, which does not hurt who wax you on the head with this thing, or I guess on some other body part. And so with three guys, adolescent at heart, even though this is designed, I think, for ages seven and up, we just got hours and hours of endless fun out of this thing. It was so much fun because you also have these ridiculous things that come up. My brother's wife, so my sister-in-law was trying, she had mouth. Mouth was the one point word, and she said, "Teeth house." And he was like, "Teeth house." The stuff that comes out can be really, really funny. That's so good. And it's very easy to get up and running quickly, which is what made this, I think, more attractive than some of the other games. I bought at Game Shops, which were very... a much heavier lift on the way in. And I want to just, as a way of setting the table, tell people, part of the reason I was excited to have you on, and we chatted a bit before recording, and you and I are aligned on... I'm sure quite a few things, but one is helping people, and I'll include myself in that group, to spend less time in front of screens. And games are a very easy way to do that. If you find the right games and you choose the right tool to suit your personality, and those are the friends that you have. So I jumped in and gave a TED talk there for a second, so thanks for putting up with that. But hold on, let me just interject. What you just described, I mean, you're hired, that was the perfect commercial. What you just described is a game that's not necessarily entertaining, but a game that allowed those three people you included to entertain each other. And that's music to my ears. Like that means, "Okay, success. We built a cool game there. That was the goal. We hit it." I didn't even have to be in the room to facilitate that. You just had exactly the experience I wanted you to have. I'm thrilled. Absolute winner. Yeah. So let me dive into a few of the stages. So you met the game designers who you named, and what led you to want to work with them, because you must, both personally and as a company, I would imagine, get pitched a lot of new games. A lot. Yeah. So what was it besides the concept, because ideas are worth something, but they're not worth as much as people like to think. So what was it that led you to want to commit to working with them, and then what capacity was that? And then what happened over that year was it simply that everyone had a lot of projects they were juggling, and that had to fit in the gaps, or something else. Okay. So we got to take a little bit of a look at sort of the anatomy of a game. And what that means is, I believe the most important part of a game is, I don't have a great term for it. I'm actually, I have no training in game design, so I kind of make all this stuff up along as I go. So bear with me. But I think you're doing fine and laugh. Yeah. Thanks. Making it up as you go. So keep doing what you're doing. Yeah, we'll do. All right. I think at the essence of any game is what I at least call the core gameplay loop. And that's the thing that you're going to do over and over and over again. So in the case of exploding kittens, the core gameplay loop is Russian roulette with a deck of cards, right? Like there's a few bad cards in there. Draw a card. Hope it's not the bad one. You survived to see another day core gameplay loop. Uno, right? Classic game. Everybody knows Uno. If I had to describe the core gameplay loop, I would say it's a lock and key mechanism. And all that means is like you have a hand of cards. Everyone's a key. As soon as you play a key on top of a lock, which is in the center of the board, it becomes a new lock for the next player. That's the core gameplay loop, right? In that case, it's numbers and colors, but still it's just locks and keys and playing one converts one. So that concept of finding a core gameplay loop that's compelling and interesting is really hard. Really, really hard. And the ones that I'm most attracted to when I hear them is core gameplay loops that are not actually entertaining. Core gameplay loops that make the people you're playing with entertaining. Because I really think that's at the heart of games. When I think back to my childhood and playing games with my brothers and sisters growing up, I don't remember any of the games. Because I don't think I should remember any of the games. The games are not important. It's the tool set, right? Those games are tools for me to have fun with my siblings. And I remember that fun. I remember the laughter. I remember the secret alliances. I remember all that stuff. Because the games had really strong core gameplay loops that allowed me to have those interactions. All right. Sorry. Big rabbit hole there. Love rabbit holes. I'll try to keep it short, right? Okay. So that's what long form, podcaster for. Yeah, fair enough. All right. So for poetry, when Jacob and Francesca came to me with this concept, I didn't think it was a good game. And just for clarity, were they friends? Were they out of the blue? Were they working for the company in part time or full time? So this was at a conference called Oordcamp in Chicago. It's an invite only conference. So very few people there. I show up crazy introvert. I'm scared out of my mind to talk to people. But there's only 100 people there. So anybody who comes up to me and says, hello, I'm like, okay, there's something cool about this person. Otherwise I wouldn't be here. So let me try my best. And there's nowhere to hide. There's nowhere to hide. There's really nowhere to hide. So when they approached me and said, hey, can we talk to you? I just thought like, I need to give everybody here the benefit of the doubt. I need to get over my shyness. I need to talk to them. And it turns out it was a great idea because what they showed me, like I said, was not a fun game, but a really interesting core gameplay loop. This idea that communication is easy. If you reduce it down to monosyllabic words, communication becomes really challenging. And you need your friends help to get you from that caveman talk back to regular English.


Kitty Test Pilots and core gameplay loops. (12:41)

Okay. So over that then year period of time, what is happening just to come back to sort of the anatomy of the development of game? How do you refine? How do you play test? What is play testing? All that kind of stuff. So one of the biggest assets that we have at our company and the thing that took me like seven years to build is this program called the kitty test pilots. And this is a group of families that have reached out to us saying, we love your games. Tell us when the next one comes out and we respond, great, want to test some prototypes for us. And we regularly send them out very, very half-baked ideas. And we asked them just to send us feedback. So what happened over the next year? So we took that idea. I showed it to some friends. I said, okay, what if you had to translate these sentences using only single syllable words? And what came back was, oh, oh, oh, crap, this is cumbersome. This is so hard. And there's not enough time. And my turn took eight minutes. And what the hell is that? And, you know, we all this really bad feedback. But I knew that core gameplay loop was really solid. So that's when we went down to like, okay, what if the sentences were only five words long? What if we reduced the timer to two minutes, then one minute? I think the final is actually only like 45 seconds. Don't hold me to that. Something in that range. Something. Yeah. Yeah. But we started to realize like I'm getting better and better results, the fewer words they have to do at once, but they want more time to do a bunch more words. So eventually we got down to, all right, let's try out two things. One, you only have to do one word at a time. Let's see if that's interesting. And two, what does punishment mean? Because everybody laughs when you use a word with more than one syllable. But then it kind of ended. It was like setting up for a joke, but the punch line never came. And so we thought, all right, we'll put a buzzer in there. Or there's a word you shout out. And I'm pretty sure it was Matt with his just perfect pitch sense of humor. Said, well, it's a caveman game. So give him a club and let him bonk each other over the head. And I'm sure general counsel of that. Yeah. Oh, man, you would not believe how lawyers hate us. Holy crap. Endless, endless conversations. They made us in the instructions. They made us say, hit the other person over the head, softly. They insisted on that. And so we changed it without asking. We put a two soft ish over the head. That was our version of a compromise. Anyway, when we talk about the anatomy of a game, though, like we're talking about that core gameplay loop. OK, we really got it now. One word, get through as many one word cards as you can, as fast as you can. You've got a few seconds to do so. And now we start to add. You know, the surroundings around the game, we need to pick really funny words that we know are going to elicit funny responses. Teeth is really great. Teeth was calculated. Teeth is not just a word that shows up in that game. We had to think like, all right, what are words where when you try to describe them, you're going to start to stumble. And the places you have to go yield really funny results, right? And things like teeth start to show up in the game. And then we started thinking about punishment. And we started thinking about the no stick. It's called because everything in the game is just single syllables. And on and on, it went until we had our core game loops surrounded by this really beautiful kind of menagerie of things that enhanced the experience and made it so like, OK, you can start playing this game. Every single element is going to push you towards that core gameplay loop. And the core gameplay loop is going to rely. The fuel running that engine, that loop running over and over again, is the other players. And once we hit that in this beautiful, elegant, fast loop, that's when we start throwing that thing in a box and pushing it out the door. Chipping out. So could you give it another example or two of core gameplay loop? Because on one hand, it sounds like there could be a core gameplay loop that is almost like a theme, much like you might have the Hollywood pitch of, say, Alien, which is Jaws in Space. Right. Right. Right. Something very simple, which encapsulates the melding of two ideas that make something interesting. Yeah. But it could also be a game mechanic, which I know much less about. Could you give another example or two of core gameplay loop? Absolutely. I love dissecting games to find these. So I'll start with one of my own. So let's look at exploding kittens. I described it really briefly before, it's just Russian roulette with a deck of cards. That's not accurate. If we want to talk about the actual core gameplay loop, what that game is is Russian roulette with a deck of cards where you get to decide where to place the bullet. And that is super important. That actually, the very first time we tested the game, it was just, here's a deck of cards, there's a few bullets, and we didn't even know what to call it in time. Here's, there's a few bullets in this deck. We're just going to take turns drawing. Someone draws a bullet, your dad, everybody continues on without you. That game was no fun at all. And the reason it was no fun is because it's us playing against the game. The game is, the game has all the burden of entertaining us. Absolutely uninteresting. We introduced these other cards into the game called "diffuse cards." And all the diffuse card did was it said, "Look, if you draw that bullet, instead of dying, you can put it back in the deck anywhere you want in secret." Now we've got a game. Because now it's not random, it's not actually Russian roulette, it's not a random game. You have to survive me. You have to outthink me. I just put this thing somewhere in the deck and now it's your turn to go. Did I put it on top? Maybe you don't want to draw that card. Did I put it on the bottom? Maybe you don't want to draw that card. Did I know that you knew, that I knew, that you knew, that I didn't put it on the top? And so you skipped your turn and drew the second one down? Well, maybe I knew that, right? Now suddenly the game fades away and I'm playing against you. And that's the core gameplay loop of exploding kittens. And I believe why it's been so successful. So we're going to bounce all over the place, which is, I guess.


Crowdfunding, alternate reality games, and internet archaeology. (18:43)

I'm going to make it a feature and not a bug of my style of conversation. But let's chat if you're open to it about Kickstarter for a moment. Because I know a lot of people outside of games specifically will still be interested in Kickstarter or crowdfunding in general. So you, I believe at one point, had a fraud alert email printed out and framed. Because I think somewhere the limo was set, like 10,000 and maybe got bumped like 50,000 for this new bank account for things. What was your initial target for the Kickstarter campaign and where did you end up? The initial target was, we were trying to raise $10,000 in 30 days. And we set that alert, like the bank would let us deposit a check up to $50,000. They were being very generous. And the check that we tried to deposit at the end of those 30 days was almost $9 million. Okay. I have specific questions around how you did things differently. And you had some very strong advantages going in, right? You had your background. You had Matt in the oatmeal and all the followers of the oatmeal. Yeah. So you had a deck that was loaded in a sense, but still ended up being, maybe still is the most backed in terms of number of backers Kickstarter project or at least at the time, that was the case. It's still the case by a lot, actually. In order to talk about Kickstarter, we have to talk about two things. One is alternate reality games and the other is the oatmeal. Yeah. So alternate reality games, like my background being sort of trained at Microsoft and at the Xbox and learning about communities and the appeal of games and why we play games together. I then went off and started with some friends, this company, to build alternate reality games. And all you really need to know about alternate reality games, although I could talk about them for a long time, is the central premise is together you are stronger. Together as a community, you can do stuff. You can become extraordinary versions of yourselves. And the games are set up to deliver a story out in the real world that is convoluted and you have to piece it back together. It's like my mentor, Jordan Weisman likes to call it internet archaeology. So archaeology is you find all the little bits and pieces of the vase, you put it together in order to figure out what it is about that society, how that society lived, how those people lived. Alternate reality games are the same thing. We write a beautiful story, start to finish with a very compelling narrative, and then we break it up into little pieces and we hide those pieces everywhere in the real world, on the internet, on phone lines, fax lines, live actors, everywhere. And you, the audience working together, because you're stronger together, go and perform that feat of archaeology, find all the pieces, put them back together, look at your beautiful digital vase, and then learn the story based on what you found. So I built a lot of those and I was really trained over and over again, really beaten into my sake, community first, community first. They're so much smarter than you are, learn to entertain a crowd. That's what this is all about. All right, we decided to launch this Kickstarter campaign. We had this really compelling hook. We knew the game was really good. We put up the page and the very first thing that happens is the oatmeal goes into full effect. Matt has spent at that point about a decade building an audience, earning their trust, convincing them that he does just really high quality work. And for those who don't know, could you just explain what the oatmeal?


Matthew Inman and The Oatmeal millions. (22:33)

Yes. So at that point, what would it look like? Yeah. So at that point, the oatmeal was, and still is, a webpage, the oatmeal.com. And Matt has spent 10 years writing short form comedy, one panel, sometimes up to four panel comics, very few long form pieces where he tells stories about his childhood, or it's a lot of social commentary. And they're hilarious, they're beautiful. Some of them have won Eisner Awards, they will make you cry. He is, Matt is truly one of the most talented artists and comedians I've ever met. And yeah, he's a guy he's just so much smarter than I am. It's an incredible collaboration. And I got to meet him through a mutual friend. I pitched this game to him, we talked about it, he said he'd really like to help. And off we went. And when we launched the Kickstarter campaign, honestly, it was only like three weeks after I met him. Wow, that's fast. Yeah, really fast. We built this. Didn't realize that was that fast. We built it fast because we had nothing to lose. We didn't think it would be a huge success. We just thought, this feels really good. We don't have to overthink this. Let's just go. Is it fair to say that also at that point, you had the game mechanics refined. And Matt was bringing in a lot of the sort of artistic comedic flair in terms of the back hair cards and the artwork. So you're effectively adding art to game mechanics that were ready to go, but kind of lacked an artistic vehicle. Yeah, that's totally fair. There are 56 cards in the game. And so Matt's task was not to design the game, although we both worked hard to refine it. Matt's task was write 56 one-panel jokes. And he did. Like you flipped through that deck. And the first thing you're going to do is just laugh. I mean, it's such beautiful art. Yeah. Okay, so back to our story. We launched the Kickstarter campaign and Matt posts about it. This is for the first time ever I've done a game. I hope you like it. And millions of people showed up. Like literally millions of views to that Kickstarter page. And our first, we got funded. We were trying to raise $10,000. We got funded in like seven minutes. I mean, it was out of control. And our first day, we made a million dollars. And our second day, we had two million and our third day, we had three million. And it was just like, this is a runaway train. Like we have certainly caught lightning in a bottle. We've unleashed the full potential of the oatmeal. Here's finally a way to productize that incredible brand. Welcome exploding kittens to the world. But then after the first week. After the first week, it fell off a cliff. And the reason is just because everyone who Matt could reach, who was interested in this thing, had taken a look, either made a purchase decision or not. And that was it. You know, the tank was empty. So I sat down with him and we're like, well, we got two choices. We can either just sort of write off into the sunset and say, we made like four million bucks. That's incredible. We were trying to raise 10,000. Let's just take a bow and we're done. Or we try to push this thing a little bit and just see what else is possible on Kickstarter. And I kind of, at the time, wow, this is long-winded, but I guess so, so into this stuff. So bear with me. At the time, the way that Kickstarter worked, the kind of only lever you had were these things called stretch goals. And the way a stretch goal works is you say, look, I got this product. I'm going to charge you 20 bucks for it. And we're going to try to raise $10,000. But if we raise $20,000 for free, everybody gets three more bonus cards. And if we raise $50,000, you get a carrying case. And if we raise $100,000, you know, your gold plated cards, whatever it is, that was the tool you had. Give us more money. We'll give you more shit. We decided. That's going to be the name of this podcast. Yeah. Not getting it, getting it, getting it. When we looked at that ecosystem, with that one lever, give us more money, we'll give you more shit. We kind of thought like, there's got to be something else we can do. There's got to be something else. And I suddenly, like my eyes went wide and I realized, holy crap, I've been training for this moment my whole down life. Yeah. Like we need to activate the community instead of thinking this is, you know, crowd funding. Listen to this, this is crowd funding, right? Yeah. So we did stretch goals just like everybody else. But instead of tying it to money, we tied it to just insane shit that we could ask the backers to do. We basically said, look, we're going to throw a party and everybody's invited. Instead of giving us more money, we're done with money. Instead, hey, we got this character in our game called taco cat, half cat, half taco. Show us a picture of a real taco cat. And if you do, if like 10 people do that, we'll throw in 10 extra cards. That's a stretch goal. You know, it would be funny. Give us a picture of 10 Batman's in a hot tub. Whatever the hell that means, we want to see it. Somebody does that. We'll give you a fancy carrying case. And we just went nuts. We wrote these challenges that were insane and funny and basically said, we just want to have fun. Please have fun with us. This is going to be, we're only here for another 20 days. So why don't we just celebrate the whole way through? And the audience jumped on it and they did everything we asked. They took those pictures and they wrote poems. They filmed videos. They went out on the streets. They met each other. They had parties together. They ordered pizza like all the fun stuff because we basically said, money doesn't matter anymore. Let's just have fun. And it was a great invitation. All right. So many places I want to go with this. And of course you are all of this alternate reality training for this sudden IRL Olympics that was brought to bear. A Kickstarter. The first is just to put in context the money doesn't matter. Comment because it seems like at the time you're around four. And you made additional millions of dollars. Is that because there was a pre-order button on the page? Yeah. And as Buzz built, even though the tiers weren't predicated on people spending more money, you had more new orders coming in as the buzz around these challenges and so on traveled. That's exactly right. We didn't ask for more money. We just said, this is the page where we're going to use this page as mission control. This is where we're going to put out all the new challenges. This is where we're going to tell you what you've earned when those challenges are complete. None of those challenges, again, have anything to do with money. But because it's a Kickstarter page, there's also a back this project button right there. And so the dollar is kept rolling in.


The perils of operating faster than the speed of Gmail. (29:31)

Yeah. I love this because you're doing what I think is so beautiful when it works. And I want to ask you more about it because I'm sure you have more thoughts, which is how do you turn, say, casual fans into super fans, super fans into proselytizers? And then you basically, and I know this is simplified, but if you do that well, you basically don't need a PR marketing department to the extent that you would otherwise, right? Absolutely. Now you had them doing all sorts of stuff. So pets disguised as fighter jets, real unicorn, H. Lada's. And it goes on and on and on. The second major question that I have is, how did you track all of this stuff? Because it seems like, at least in today's social media environment, perhaps it's just, it's more scattered now and is more centralized then. But how did you keep track of all this stuff? And I guess you don't need to keep track of all of it, because really you're saying if we get 10 batmans in a tub and we get 10 of those, yeah, unlock. Yeah, exactly. We tracked it very, very poorly. Like, look, we had a two sort of arguably three-person team at that point. So what does arguably three-person do? Yeah, well, some friends of mine would sort of like, you know, drift in and drift out in their spare time. Right, right, right. I'll tell you, I learned something amazing. We had a Gmail account associated with Kickstarter page. Oh boy. And apparently there's a limit if a Gmail account receives a certain number of emails over a particular amount of time that Gmail account gets shut down. No, no. Turns out that number is 10,000 per second. Oh, wow. And we hit that trap. Holy shit. Yeah. Yeah. So do you just assume you're like, all right, we're not going to read 10,000 a second. We assume there are some batmans in a tub in there. So fuck it. We were planning on being able to deliver anyways. Let's just-- So we didn't do it. So you asked the question, like, how do you convert those casual fans into super fans? Yeah.


Converting casual fans into superfans. (31:32)

The way you do that is you don't make those assumptions. You actually do need to read through those emails because the conversion process is shining a light on them. Like-- Yeah, totally. You have to-- Right, you have to send out an update that says, look what you did. And you have to have the pictures right there. And the first draft of that update said, look what happened. And we realized, whoa, that's the wrong message. It has to say, look what you did. Nothing to do with us. Yeah. Nothing to do with just facts. You, you spotlight on you. And that's when people start to convert because they're like, Oh, alternate reality training. We are more powerful together. We are a community. Let's all keep working together.


What not to do when your Kickstarter goes better than expected. (32:19)

You've learned a lot. And I'm sure that the approach you take to distributing your games has changed over time since once you establish yourself. It's like once your guns and roses and you've had appetite for destruction, like the way you approach things is a little different, right? Yes. Yeah. But I have read you elsewhere, worn, which I thought was very astute. So I'll mention it here. And then I'd love for you to maybe flesh it out a bit. Worn people about stretch goals where, for instance, they're like, we're going to give a t-shirt. And it's like, well, wait a second, how much experience do you have with manufacturing, fulfillment, excuse, multiple sizes? And if you have a tabletop game, it's hard enough to learn how to be in the tabletop business. If you're new, let alone deciding you're going to have also a t-shirt business to try to figure out, not to mention the distraction cost. Are there any other best practices/pitfalls that you had worn against? Well, first of all, that's so true. I haven't looked at the numbers recently, but there was a time about like two or three years ago when I looked at the top 10 Kickstarter campaigns of all time. And we were, you know, we're always in that list somewhere. People are constantly beating our record. They haven't beat our number of backers, but certainly made more money than we have. And I looked at the top 10, and of those 10, we were the only company still in business. Wow. And it's because before that much money comes in to earn that much money, there is this incredible temptation to branch out and to become a t-shirt company and send out posters and say, "We're going to hand autograph every single instance of this thing." And it's such a mistake, right? Like you are being backed to focus on fulfilling one item. Just do that. Just stop trying to like give people more party favors. Stop trying to be more popular. Like the way you make those friends is by fulfilling the promise you made to those people. And it's very rare that people adhere to that. It's such a shame. So I'm going to, I've been so excited to talk to you, man.


The budget of production needs to fit the fun. (34:30)

I really appreciate you making the time. And despite my caveat at the beginning, before we start recording, which is I think I'm having an allergic reaction. I'm actually slowly like pulling it together, going from my zombification earlier to semi-coherent. So thank you. My pleasure. I want to give you credit where credit is due. There are many ways I could do that. But top 10 to still be in the top 10 of all time is remarkable for a lot of reasons, one of which is as Kickstarter gains in popularity, it is not an apples to apples comparison. In the same way that if you look at say the top 100 box office earners of all time from a film perspective, it's very hard to compare something from the 50s or 60s with say 1990 because of theater penetration, inflation, right? That's a thing. Totally. Prices go up. So it's astonishing that you guys have had that degree of longevity. And part of why I think you have been, and this is speculation, but part of why I think you've been so successful, and not just once but multiple times, is you're very good at applying positive constraints. Well said. So I would love to know, for instance, as a company, right? So it's one thing to go from a successful project to fulfilling that project. And a lot of people are killed just in that process. It's quite another to build out a company that then expands, raises funding, takes on private equity, and it's done everything that you guys have done, which is it's very rare. What are some of the constraints? Because if I look at your games, right, I look at the form factor, the size, like it seems like there's thought put into maybe the maximum size. I don't know. And then I look at the complexity and I'm like, okay, we're not dealing with like metal figurines. How do you think about the parameters that you place on your games? Oh, there's so much to talk about here. Let's do it. One of them. Okay, you open a game box and I'm going to break that down into two parts. There's the game components and then there's the box itself. Okay. First, let's talk about the box itself because it's this ridiculous conundrum. If you were to go and buy a new iPhone, that box is beautiful and expensive. They spend like 10 or 20 or $50 building that hard cardboard box and it's beautifully printed and it's glossy. And you know what you do? You take out the iPhone and you throw the box away. Yep. My margins on my box are so tiny that I need to spend four cents, five cents building that box and you're going to take the game out and then you're going to play it and you're going to put it back in that box and that box has to survive 20 years. Like it's insane. It is so hard to do. And so first we have to understand play patterns. We have to understand how the audience actually uses this product and most games will spend. They'll stay within their margins. They'll say, well, we can only spend four cents on the box. So we're going to build it. We know the thing's going to disintegrate, but so be it. We don't have that approach at all. We lose money on every box and that's cool. We're okay with that because we know like this is a lifelong commitment we're making to you. Now, just to be clear, when you say box, this is the packaging surrounding the game. You're not saying on every game. Correct. Exactly right. We break it down by, you know, there's a certain amount of budget allocated to each component in the box is one of those. Now let's look at the actual components in the box. And I had to learn about all this stuff. I had no idea that there was such thing as card thickness or weight of different cardboard components. Did you know there's a catalog of sand timers that you can look through? They're not all the same. Forget like how much time passes through them, but like the quality of the sand, the quality of the plastic, it does it have one layer or two layers? Are they multiple colors? Have you dyed the sand? All this stuff. And we look at all of it and for our mantra as a company is opening that box has to be a delight. Like everything you touch in there has to feel beautiful. It has to feel like someone loved this thing because we're about to ask those players for a lot. We're about to say, yeah, put down your phone. Holy crap, put down your phone. Read like 15 minutes worth of instructions. That's a huge ask. 15 minutes and explain it to everybody else at the table and then try playing the game and you're probably going to screw it up and read them again and then try it again. Like the dropout rate is enormous, but if they feel like someone really cares about this thing, someone really devoted time, maybe it'll give us more of a chance. And so that's the biggest constraint we place is we're like, okay, just put the budget aside for a second. Know that what everybody else does does not really apply here. We need to make a beautiful product. We need to make something that people fall in love with as much as we are in love with it. And that's the translation. Our love will equal theirs. So question about size, not to get too personal.


Does size matter? (39:40)

I would imagine that with the components, their materials cost and that could be just a volume question, right? Like how much of X material you are using. The games that I have seen produced by Exploding Kittens have all seemed easy to travel with. I don't know if that is a side effect of other design principles or if that is sort of a first principle. Yeah. Do you have games that are much larger? We do. We've tried a bunch of things. So when we talk about size, there's a few things to keep in mind. Travel is huge. We know people want to be able to transport these things from place to place, bring it to a party, bring it to a family reunion. You know, that stuff is super important. But when we put a box on a shelf, we're fighting with all the other games on that shelf. And if you think of a box as a billboard, the biggest billboard is going to win. So having a smaller box is not necessarily advantageous there. But now we pitch the flip side of that, which is we got to ship these things from the manufacturing plant to a warehouse. And how many boxes can you fit in what's called a shipper? A lot of pallet and then in a container. Right. Yeah. So all of that matters a lot. It's this very delicate balance. Well, we've started doing, because we prefer smaller boxes, we've started doing deals with retailers like Target and Walmart to say, look, we're going to give you a smaller box, but let us build a, these are called shippers. They're big cardboard frames that sit on the shelf and then the game sits inside of it. So we're trying to get the best of both worlds, right? Big billboard, lots of presents on the shelf. But the game is actually really small and convenient. You can take it with you anywhere.


How do your sales channels break down? And we can edit this out if you don't want to talk about it. But I'm curious in the beginning, you had D to C, D to C, D to C, right? Direct to consumer, you're shipping, you're handling all of that. As you become more popular and particularly given the ease of use of your games, the doors open up to using distributors and getting placement at places like Walmart, Target, etc. Right. What does that look like now for you guys versus in the, like, what did it look like for the first three or four games and what does it look like now? So first three or four games were 100% D to C, like all we did was sold the game or so. That's what Kickstarter basically was, right? Then we moved into Amazon and Amazon very quickly eclipsed our ability to sell our own game. And then the retailers, retailers went through this incredible shift. They're like, "Hey, our game sections used to have like four games. It used to be like, we've got Connect 4 and Monopoly and that's about it." And they said, "Let's actually build a real game section." And they reached out to us and said, "What's it going to take to get you on the shelf?" And we said, "Wow, anchor tenant." Yeah, right. I mean, seriously, we were talking about right place at the right time. That's cool, man. Yeah, seriously, we... That's a big deal. It was huge. It was huge. And so we got to kind of build the game's departments with them and to say like, "Yeah, but you got to teach us everything, right? We don't even know what our self is. We don't know what price to ask for. We don't know anything." And they worked with us and we built it together. And it was really awesome. And now I can't give you a retailer by retailer breakdown, but I will say that retail accounts for about 60% of our business now. What is the remaining 40%? It's a mix between online, hobby, international, and direct to consumer. What is hobby? Oh, sorry. Yeah, I had to learn this too. So... I mean, I know the word. Yeah, yeah, right. Right. So hobby is this generic term that covers a lot of things. It basically means a store that primarily sells games. So if you think of a kind of mom-and-pop game stores, they're typically where you're going to go to buy more hardcore games, like more strategy games. For sure. But they're starting to really get into party games, so they have a lot of interest in us. Okay. But while we can sell directly to Target and Walmart, there's hundreds of thousands of hobby stores. So you have to work through a middle manager to deal with those people. Yeah, distributor of something like that. Yeah.


Building a game from scratch quickly. (44:02)

Okay. So this is going to strip away the company for a second, because I'm curious. Okay. Let's just say there's something like Iron Chef for tabletop games. Yeah. If you want that, you can roll with it. Yeah. I'll take my customer 15%. Yeah. So it's like the unveiling of the components, let's just say, which would be some constraints. I'm not going to give you specific ones, but let's just say you yourself kind of locked in a room, like old school Japanese manga artists, this would happen. Like the publishers would be like, you need to finish X number of issues. Like we're going to keep you fed, but you're going to be in a room until you finish. Yeah. Yeah. Right. Intense. But let's just say that you had a week to design a game. You were allowed to have some playtesters come in for like the second half of the week. Okay. Generous of you. Thank you. You're welcome. I'm a very lenient dictator. I'm known as the thoughtful warden. How would you personally approach it? Like you can have pen and paper and all of the mock-up materials that you need. Yeah. How would you go about it? First of all, you don't need much more than pen and paper, honestly. Like that's it. So the way I would go about it is I would say, okay, given this, maybe these blank cards and these sharpie pens, which I travel around with everywhere, like that is all my bag is filled with. And blank cards, you mean like a play? Yeah, like poker cards. Stack of cards. But blank weight on both sides. Yeah. Where do you get those? Amazon. Literally I order them by the palette at this point. It's nuts. Because they're so cool, right? Like you need to design a game. You got the cards. You need dice. I don't have dice. Great. I'll take six cards, right? One, two, three, four, five, six. Shuffle them up, draw a card. Hey, you got dice, right? Like they're everything. They're absolutely everything. So the first thing I would look for is like, what can I do with these very simple components that creates a core gameplay loop that I'm excited about? And I can rattle off 12 of those in an hour. That's honestly not the hard part. 12 different gameplay loops that you're familiar with. That I'm excited about. That I can just invent. They're not that hard. It's like, okay, I'm going to give you a card and I'm going to keep a card. And whoever has the highest card wins. But first we're going to have a conversation. And I'm making this up as I go. I'm going to try to bluff you. Like I'm going to try to get you to discard your card because you don't think there's any chance you can win. And you can still earn a little bit if I can get you to fold, right? Right. Those are easy. And come up with a ton of those. And again, you notice the crux of that was we're entertaining each other. The conversation is actually the game. The cards don't matter. That's just my mantra over and over and over again. Yep. So we do that. Come up with a bunch of those. And then I need another person. I need at least one person that I can show these two play the games with. And I only care about one question. In fact, we do all these play tests. We don't even give out surveys anymore. There's only one question we ask, which is when you finish playing the game, did you want to play again? And a game is done when 100% of people say yes. And it never starts that way. It's always a whole bunch of no's. And let me tell you why and all that stuff. But that's the only question I care about. When you finish, did you want to play again? And if I can get a little bit of positive feedback there from a person showing a bunch of concepts to one one of them, they say, oh, let's play that one again. Then you got to start thinking about, okay, why did they want to play that again? Well, maybe they had so much fun. They wanted to play again. Maybe they thought they could do better the second time. Kind of a sense of mastery that maybe they could achieve by playing again. And I try to identify what that thing is, what that compelling, that thing that can pull in the back end and double down on that. Right? That's the thing I want to shine most in the game. Start building the surrounding components all to emphasize that thing over and over and over again. And then generously, you let me have play testers at the end. I'll start showing it to them. That is the point where I've got my components are done. My core gameplay loop is done. I've got a few of the peripheral things that are starting to get those cylinders to fire. Now let me put it through the paces and see what people think. Okay, so let's say day one. Yeah. So day one, you get you get seated and you're comfortable, yet not too comfortable, sell. You have this like hamster bottle full of coffee. Yeah, good. I love it. You got unlimited ramen and you have a table. You got your blank cards, paper, sharpies. What is your brainstorming? If that's the right word to use, look like, right? Is it questions? Right. Is it drawing cards? Visually or otherwise, it's just you sitting there staring at the wall, kind of running through things, rehearsing different things in your mind. What would that look like? I think the way that I approach that is I always imagine two of me. And when I have, I need to physically touch and hold things, right? So even if the cards are blank, I do need to like hold six cards and shuffle six cards. And so if I'm holding them and I think, okay, me standing in front of me, if I were to give you this thing, what conversation could we have? It's, I think it's a lot like script writing. Like I start with the conflict. What is it that's going to drive the conversation? We can't be getting along. We can't have the same motivation. Me handing this thing to you, better create a conflict, that now we're going to try to resolve. And that's really it. I think that's where all good ideas start from is like, here we are in a room, you know, there can be only one. So how are we going to resolve that? Because here we are staring at a bunch of blank cards. So looking at the company, it strikes me that you have chosen lanes very well to plan.


Guiding principles. (49:48)

And what I mean by that is, you have not, as far as I can tell, maybe you have, so correct me if I'm wrong, but you haven't gone off into the incredibly complex, like $200 game that requires three hours to get the basics down, after which it requires, you know, probably 20 hours of play to get to the sort of intermediate level. There are a lot of those games and a lot of the hobby shops seem to favor those games for a lot of reasons that I think are understandable. I mean, the die hearts love die hard products. Totally. What other guiding principles do you have, for instance, like two player versus you need three or four players to get started? Any other elements that are integral pieces of the DNA of your design process? Well, first I got to say, man, Tim, you ask really good questions. This is fun. So this is stuff I just don't think often about. It just sort of happens. So this is awesome. All right. When I was growing up, the biggest frustration I had with games was first and foremost, the instructions. Like, I just, like, I don't have the patience to even read 20 minutes, like let alone the seven hours, right, to get into those crazy games. And so I really wanted to make games that, you know, 10 year old me would really get a kick out of. One of the things I'm most proud of about our instructions is any of the instructions you look at, the very first thing your eyes are going to be drawn to is this box that says, "Hey, don't read these rules. Reading is the worst way to learn how to play a game. Instead, go to our website and we'll teach it. We'll just walk you through it in like four minutes." And we made a video. We have a how to play video. And video. Yeah. Right. Yeah. And we did that for every game and I insisted on it and it's, you know, it's expensive, but I insist on that. Absolutely insist every game, don't read the instructions even though we spent months working on the instructions. That's one hugely important thing to me. You should be able to pick up the game in five minutes and you shouldn't even have to read to do it. You should just sit down, watch a thing. You're done. Second thing is, of course, like I was talking about, the game just has to be a tool set for the other players to be entertaining. I think the other ones though are a game cannot feel fragile. I don't mean the physical components. I mean, it can't be too easy to cheat. It can't feel like you shouldn't ever feel motivated to outsmart the game. The game is to just say, "Look, you already know. You've already got everything you need to play. We're just going to tweak the world a little bit. What if you could only speak using single syllable words, right? Like, we're not going to involve too much. This thing will always stand out no matter what you throw at it. That's really important as well because I have a bookshelf with literally hundreds of games. And so many of them, I've realized I accidentally broke the rules. The game was just too fragile. I didn't mean to. It just keeps happening. And then I think also a game should be beautiful. You should look at a game and smile. It should be a source of joy. These things should be dopamine engines. And part of that is you want to hold the thing and show it all your friends. And that's actually probably the actual final one, which is when you're done playing your first instinct, well, after I want to play again, your second instinct, I'll say, is I'm going to put this in my bag and take it to my buddy's house because I'm going to get a little bit of more joy by sharing this with someone. And the thing starts to have a life. Yeah, I'll give you just an anecdote on poetry for Neanderthals. My recommendation for folks, if you play this, first of all, your mileage may vary, right? Always. I don't believe that the whole world is just comprised of different sized Tims. That's not the case. However, my recommendation is don't do what I and my friends did, which is we decided we were going to play with three people to 100 points, but you had to win by a certain margin of points. And that's like not doing any exercise for six months and deciding you're going to do the leg workout from Arnold Schwarzenegger from 1974. We all felt that the next day we're like, wow, some portion of our brain has not been used in that way. That's something we say. And we really put it under extreme duress, but I do recommend people check it out.


Lessons Learned And Applying Them In Practice

Foundational game recommendations for beginners. (54:33)

I want to flashback to your mention of the hundreds of games that you have. As someone who was a super devoted D&D player for a long time, which may seem, I'll just explain to folks, may seem to contradict something that I named as the appeal of a lot of your games, which is the simplicity. D&D, especially when I was playing, and I have first edition players, handbook and Dungeon Master's Guide and so on, I still have all of my modules and campaigns and everything, is extremely in depth. But it is also one of the best games I've ever found for co-creating a narrative and finding one another and making one another interesting and entertaining. It is just one of the great wonders of the world as far as I'm concerned. Would you say it enhanced your friendships with the players? Oh, 100%. But there were these occasional flare-ups, as you might imagine, especially if a Dungeon Master was in a pissy mood and decided to really damage someone who was getting on his nerves. It was a... But it was the defining, let's just call it sport of that section of my childhood because I was a run. I got the shit kicked out of me constantly at school. There were a handful of other kids who fit the same description, and we banded together, I guess, much like Stranger Things, but minus the aliens and everything to play D&D. That was where we could shine. But the reason I bring it up is that I have played relatively few games. I've played a lot of the classics. I've played chess, I've played backgammon, I've played Japanese chess, I've played Go, etc. But now, sort of side-stepping my way nervously into the gaming world, tabletop games have exploded. There are a million different genres, and what I've heard in some interviews, not with you, but of game designers is you have to keep up with the times. You got to watch where the ball is going. And it seems like an arms race on some level, and I'm skeptical of it. Good. I'm skeptical of that because it seems like you could end up chasing fads and you decide, "Oh, Pokemon Go is really big. People are running through Central Park tripping over benches." And if you do it incorrectly, you basically just fizzle because that was a flash in the pan, not to say that that's true. So what I'm wondering about the hundreds of games that you have, if you were to teach a three-hour class on the periodic table of elements for games, and you're like, "These are some of the canonical games or types of games that you must be familiar with, just like a chef has to know salt, oil, sweet sour umami, some of these basics, what would some of the candidates be for that?" Oh, okay. Yeah, okay. Stretching here. This is going to be... Stretching. Okay. First of all, let me say I will admit I am a fish out of water here. I've never played D&D. Literally ever. I've never played any of those crazy 10-hour strategy games. I'm missing out on that experience. I would love to have that experience lately. I've been pretty busy. So it just hasn't... It hasn't come up. I don't even know how to talk about this. But I will say that I have played a ton of board games and a ton of card games. And there... Right, there's a language. There's a core ingredient list. That's important. All right, the first one that's become really popular right now, I'm sure there's like a fancy industry term for it. But it's kind of like a... It's like a fill-in-the-blank game. So think cards against humanity. What do you mean? Joking hazard. Apples to apples. And the basic structure is always the same. It's... Someone else, there's a writer's room somewhere. They told a whole bunch of funny jokes. They cut them up into pieces. And now you're going to get credit for reassembling those jokes. That's the basic principle, right? So you have a card. It's your turn. You play a card. Everyone's got a hand of cards. You play your card and I'm going to... Not to quote another game. So I'm going to just make up a completely false game, which is what is the best thing I could wear on my head? This is a dumb example, but it illustrates the point. Everyone also has a bunch of cards. I've got banana, beach ball, turban, etc. Who are all going to play a card? Whoever's turn it was is going to vote on. Which one they thought was the best that person gets a point off we go. There's a bunch of games like that. They're very popular right now. It's an important kind of genre because it's really funny. The best ones make you laugh so hard you can barely breathe. They're just incredible. Let's see. Where should we go next? Okay, the next one I think is called... I'm going to call it deck building. And the idea is there's a whole bunch of cards. Each card does something very, very special and powerful, but they're all community cards at first. And you play the game by trying to remove things from the community into your own private stash so that then you can deploy them and beat the other players. Every card has a power and a weakness. You're trying to collect the best ones you can in order to obliterate everybody else. That's also a very popular, pretty standard one. Is there a particular game? If someone wanted to do a sort of chef's menu tasting of these different games, is there one that comes to mind that fits up? Yeah, for that one there's a game out there called Dominion, which is a... Yeah, very popular. Yeah, that's a good one to start with for deck building. Okay, next is of course collectible trading card games. Pokemon, Magic the Gathering, things like that. I won't go into too much detail on that because again, I must admit, I have never played any of those. Yeah. I just don't know anything about them. Justin Gary, who came up earlier, is a good person to look into. I think he was the youngest ever national champion in Magic the Gathering. Amazing. Really knows that genre inside and out so people can check him out. Yeah, perfect. There's physical dexterity games. I shouldn't physical or dexterity games. The idea is like to play this game, you have to do something physical. And whoever does the... Either the physical thing the best or makes it so they can impede other people's physical progress will win at those kinds of games. We have one out there. It's one of my favorite games ever. It's called Throw Throw Burrito. No. And it's dodgeball and card games all mixed into one. You try to collect cards while simultaneously throwing soft squishy burritos at the other players. Collect a card, gain a point, get hit with a burrito, lose a point. Trying to do both those things at once is where the chaos comes from. Let's see. I'm sure there's a ton more that I'm missing. How about... I'm kind of glancing over games here trying to get some inspiration. Sure. And if there are any games where even if you can't name the genre, you're like, really you must play this in the same way that if someone came to me and they said, "I want to be a long-form non-fiction book writer." Yeah. Not that I would be the most qualified teacher of all time, but I would definitely have certain books in mind where I'd say, "Okay." Yeah. Yeah. Here are five or six you gotta read. There's a few games that I've encountered in my life that have felt so natural that it doesn't feel like anybody invented them. It felt like they just all... It's like two plus two equals four, right? Nobody invented that. They just kind of realize the way to phrase it. And there's a game out there called Set that I believe falls perfectly into that category. I'm not even gonna describe what it is because you should just go and try this game. It's a cool game. I've played so. Yeah. It is a very cool game. It's one of those games that I used to play this with my sister, who's 16 years younger than me. And so when she was like 10 and I was 26, she would regularly kick my ass at that game. And it's because it activates this part of your brain that either exists or doesn't. I'm sure a lot of people are just horrible at it. But it is so neat to see a master hit that flow state with this game. And they are discovering patterns that are right there in front of everybody else. It's just they can see them and you can't. It's beautiful. It's just beautiful. Side note, this is not gonna mean anything to most people, but in my limited anecdotal experience, I would love to know if I were able to have a few drinks with the creators of this game, if they find women to get into those flow states more easily. Because I have at least in my experience seen that. And it raises all sorts of cool questions. Yeah. Yeah. I wonder how you describe that skill set. Like what are the words to describe that skill? I have no idea. But it's so beautiful to watch a master. It's just, it gives me chills. The last one I'll say is like, I'm trying to find the right category for something like Monopoly. Because there's a whole genre of game where it's like resource management, resource collection. Yeah, trading, like Settlers of Catan and so on. Yeah, that's right. Well, let's talk about Settlers of Catan for a second.


Is Settlers of Catan the game you think it is? (01:04:02)

Because for me, there is a really interesting category there. That is one of the few like hardcore games I've played. I know a lot of people would call it not hardcore, but whatever. I once challenged a group of designers. I was like, describe to me the core gameplay loop of Settlers of Catan. And by the way, I don't know the proper way to pronounce that word. Catan, Catan. Yeah, me neither. Yeah, okay. Tomato, Tomata. Yeah, right, right, right. So describe to me the core gameplay of Catan. And all three of them said the same thing or variations, which was, that's a game about collecting resources, spending those resources to expand the fastest. And I thought, that's not what that game is. That's not how I play that game. That game is a social game. That game is a trading game. I don't even care about the game. All I care about is my interactions and relationships with the other players, because that's how you win or lose. And it was so fascinating to see that like, these are hardcore, these are really experienced game designers. We were playing a different game, like completely different, even though we both read the same rules. So question, were they experienced gamers? Maybe people don't like that term, or they automatically think digital, but were they experienced game players, but not extremely experienced Catan or Catan players? Because my friends who love, I'm just going to say Catan, because I'm American, like heartaches, they do think of it as a trading game. And there's a lot of game theories. So for instance, there's some people who won't make a trade unless it clearly benefits them, but I have a friend who's very successful. And if something doesn't clearly, significantly hamper him in the early stages, he will make a trade because of the social capital that he builds up, this sort of credit for later asking for a trade. And he's very successful. That's fair. You're right. I don't know that they were successful or experienced Catan players. But that's great. That's really a suit. Yeah, I hadn't thought about it in that context. We may come back to the periodic table of elements. I mean, then this is, I'm becoming immersed in this world. Number one, because I want to spend more time off of screens. I want to also help other people do that. And the way I'm hoping to do that is by designing a game of some time. Good. Or collaborating with people to build a game. Good. And I just think that's the only way for me to really even make an attempt at trying to understand it, is to roll up my sleeves.


Lessons learned from game design veteran Jordan Weisman. (01:06:25)

You invoked a name earlier that I want to revisit. Jordan Weisman. Yeah. You called him your mentor. Who is Jordan? And what are some of the lessons you've learned or things that you have modeled from your mentor? So I met Jordan Weisman at Microsoft. Jordan Weisman is one of the most famous game designers ever. He designed Battle Tech. He designed Crimson Skies. The list goes on and on. You know, when you go to like a virtual reality center and you play any of these immersive games where you're like sitting in a big robot fighting against other robots, he designed all of that and invented all of that and actually opened the first virtual reality spaces ever in history. And I met him at Microsoft. And at the time I was hired right out of college onto this Xbox group. And they hired me as a producer. And I don't know anything about producing, but they hired me. And I saw, oh, cool. I think I work in the video games industry. What does that even mean? Because in Hollywood, producer can be a million. Yeah, fair enough. What does it mean in this context? A person in charge of a project. They actually call it the program manager there. It's the person who's responsible for schedule and budget and staffing for a project. Got it. So they hired me right out of college into this role. And the creative director for the whole studio was this guy Jordan.


If you built Jar Jar Binks’ neck, they practically let you run the place. (01:07:56)

Why would they hire you right out of college? I was a terrible, terrible, terrible student. I failed out of many colleges. But I had some really good internships. And the star internship I got just talking my way in the front door was at Industrial Light and Magic. You son of a bitch. Yeah, right. And so I got to work on Star Wars. And I got to put that on my resume. And so when I applied at Microsoft, I basically said, ignore my transcripts, ignore my history, Star Wars, Star Wars, Star Wars. And they said, sure. Yeah, come on over. Is it true that you're responsible for the beautiful neck of Jar Jar Binks? I like that you put in the right qualifier there, the neck. Yes. I did not work on Jar Jar Binks. I worked on the connective tissue on his neck that tied the CG face to the physical actor's body so that it didn't tear as he moved around. That was my job. Okay. Yeah, you don't want any injuries in the Star Wars universe. At least unless they're very interesting. So all right, so you get hired, but you've done this internship. That shines through. You get hired to be the producer. Yeah. And so they put me on the Xbox. They basically said, we need six games. Here's $200 million. Don't fuck up. Like that was it. And you know, I'm sorry to be laborless. Hold on. $200 million is a lot of money. What gave them confidence that you could go from the neck of Jar Jar Binks to managing $200 million? I mean, were there other safeguards in place? That's a lot of money. You didn't give me $200 million. They gave Jordan $200 million. I just worked before. Okay. Okay. Okay. Okay. Okay. Okay. All right. So Jordan hired me and like, I must have been working there for two weeks where he pulled me aside and he said, you're a terrible producer. Like you're just awful. And I said, yeah, I know. And he said, but like to his credit, I don't know why. He said, I think you might be a really good designer. So we're going to switch roles. I don't quite know what it is he saw on me, but he said, I'm going to help train you. And you're going to help design games instead of produce them. We have very talented people for that far better than you. Let's try this. And he immediately just started throwing me on projects, projects like Halo and saying like, go do this, like go help with this thing. And it was great. Obviously, you know, the first six games for the Xbox that came out were great. They set the tone for what the Xbox was. And I got a ton of credit. Again, all because of Jordan, because he saw something in me and said, go play in this arena instead. And maybe the best way to describe who Jordan is is years later, we'd started a few companies together.


If you can’t rock the vote, then clothe the vote. (01:10:41)

And I right at the point, when was this? This was when George W. Bush had just won his second term. And all my friends were upset. Like everyone kept, oh, God, the system is rigged. It's not fair. He shouldn't have won again. He was so bad the first like all this stuff. I don't care what your political persuasions are, but like a whole bunch of people were just complaining and I would always ask the same question. Well, did you vote? And they would all say, well, no, it doesn't matter. And I got so upset. I was like, I just, oh, there's just this one tool. You have and you're not using your one tool. And I sat down with Jordan and he said, you know, this reminds me a lot. I was complaining about this thing. All my friends, they're not voting and they still have the audacity to complain about it. And he said, okay, you know, this reminds me a lot of like the story of how the US was founded. There was, there was a bunch of upset people and they eventually did something about it. And he said, you know what we should do? Because it's Jordan. He said, we should start a clothing company. Right. And so I was like, well, I'm not following this at all. But yes, you know what? Let's go. Let's do it. And so what we did was we started this clothing company where we made these beautiful shirts. Like it was mostly a t-shirt company. We put out a whole line of t-shirts. Each one was gorgeous, like beautiful. We hired the best artists in the world and just designed these shirts. But every shirt had hidden inside of it a secret code or hidden message somewhere in the shirt. And sometimes it was like right on the printing, you had like fold your shirt a certain way and get the graphics to line up. And you could read suddenly a secret message would appear. But we use things like invisible inks. We use things like glow in the dark inks, thermal inks, right? Get your shirt hot and suddenly a message would appear. And if you could figure out the message, you'd take it to the website. You enter in the message and a little movie would start playing a little two-minute clip. And it was basically a TV show, right? Every shirt had its own two-minute clip. They fit together like a TV show. It was episodic and each one would end in a cliffhanger. And if you want to know what happens next, awesome. Go buy another shirt. That was our business model. So how did he go from the prompt of you being upset about voting? Yeah. To make the conceptual leapfrog move to that. Because Jordan's like the most brilliant guy in the world. So the story, the episodic story that we were telling was about a band. And the band had a very oppressive producer that was stealing all their money, was just making a huge mess for them. And it got so bad that eventually a member of the band got murdered. Right. Really bad. And who did it? And that was the crux of the story. And what we never told players of this game, this clothing-based game, because this was Jordan's actual brilliant idea, was as you progress through this, the players figured out that this is a beat for beat retelling of the founding of the United States. And every character has a historic counterpart, right? So the base player, Adam, was John Adams. The leader of the band, Jeff, was Thomas Jefferson. And by listening to the story and piecing it all together, you're actually learning the story of the founding of the country. And why they did it, and what they were rebelling against, and why they were so unhappy, and why they created a way for them to work their way through this system. And I'm so proud to say like our players, like millions of them, started canvassing their neighborhoods, showing up to rock the vote parties. And they got like, I don't remember the exact number, so bear with me. But it was hundreds of thousands of new registered voters through this clothing company. And that's really the beauty of Jordan, is I can go to him with a statement like, none of my friends voted. He can say, let's start a clothing company. And the answer is, 100,000 more people voted next time. It's so cool. That's amazing. Yeah. So Jordan may have some unusual hard-wiring that enables him to do certain things.


Other practical Jordanisms. (01:14:51)

Just like Michael Jordan may have some unusual hard-wiring that allows him to jump and do certain things physically. However, there are probably certain principles, certain commandments that you could distill if you had to. Right? So if Jordan said, look, you can have 10 hours of conversation with me, and then you have to teach the 10 commandments of Jordan Weisman to this freshman class, or it could be a junior class, whatever. Just let's assume they're serious. I'm not going to ask you to name 10, but do any come to mind that are sort of quintessential Jordan? They don't have to be commandments, so they could be anything that comes to mind. There's a few that are immediate because he just drilled them into my head. One is nothing attracts a crowd like a crowd. And yeah, try as hard as you want to market something. Get a crowd. That's what actually matters. Another one that he still says all the time is, you've got to violin, I've got to barn, let's put on a show. Right? Like, don't overthink this. Just go. Just like tomorrow, put on the show. And you'll learn a lot, and that's fine, and you'll fail, and that's fine too. Just go. And yeah, that one was, man, took me forever to figure out, but it's so important.


Challenges And Turning Points In Game Development

Steven Spielberg and The Beast. (01:16:19)

Now, does that apply in the context of how you knew Jordan in the sense? And I've heard other people say this, that like, you can think about it for five hours, or you can play, test it for five minutes, and you're going to get the same benefit. Something like that. That's right. That's exactly it. Yeah. Yeah. He really burned that into me. So I started the alternate reality company with Jordan. And if I were in charge of that company, we would have been paralyzed. Like, I would have been too scared to do anything. But Jordan called up Steven Spielberg and said, "We got this company. We can market your game better than anybody else in the world. You should hire us." And they did. And we had no product. We had no idea what the hell we were doing. And suddenly with Steven Spielberg, we built the world's first alternate reality game, because Jordan made a phone call. Hold on. So was he like croquet partners with the Spielberg family? What did it say? Oh, okay. Social club? How does that happen? So it was a little different. So here's how this story actually rolled out. So I was working at Microsoft doing this new designer, no idea what the hell I'm doing. And one day Steven Spielberg walks into my office. And I seriously write like, and he sits down and he says, "I got to talk to you." He says, "Your boss, Jordan, just paid Warner Brothers, I don't know, $600 million, whatever it is, for the rights to my new movie, AI. And apparently your job is you've got to make four video games about this movie. So I thought I should sit down and chat with you about what this movie is so we could get started." Like, that's how I met Spielberg. Jordan just sent him to my office and said, "Don't talk to that guy." Not the worst day. Yeah, man, that was a weird place. It was so inspiring, so much fun. But yeah, stuff like that would literally happen every day. So the way that actually rolled out, unfortunately, we built four games. We built an adventure game, we built a racing game, we built a gladiatorial combat game. And Jordan said, "Look, the thing we really have to do is we need glue between these things. We need a way to take players from one game to the other game to the other game, right? We've got this incredible narrative, but how do you understand how they all fit together? We need the glue." And so we hired this incredible writer, a guy named Sean Stewart, to write a story about the glue. So he wrote it. It was a tearjerker, just this incredible, incredible narrative. And then the movie was done. We finished all the games. We went to the premiere. I don't know if you remember this movie, but like, the movie is about an android boy who is adopted by a human family who eventually, all this android boy wants is to be loved. He wants his mother's affection and eventually he is denied that. He is abandoned in the forest. No one loves him. He's left to fend for himself. He witnesses everybody die. He in fact witnesses all of humanity go extinct and never actually achieves love. And I don't know if anybody's walking down the movie thinking, "I can't wait to play the Xbox game." Right? So we went back. Those people who came out and they were like, "I'm really depressed, but I'm not yet ready to kill myself. How can I push this just a little further?" Yeah. So we went back to work and we thought, "Oh, we got it. It's heartbreaking, but we got to cancel all of these games. Like, we just can't make any of them." So we canceled them, but we thought like... No, that's like... So now presumably when you sat down and Spielberg's like, "Okay, kid, let me tell you what this movie is about." You had some insight into the storyline and the arc of this movie. So did it come as a surprise or were you just like, "Maybe they'll change it. Maybe the studio will be like, "Steve, and please, Steve baby, we got to change the ending." So like to what extent was it a surprise or were you like, "Hey, we're getting paid well. Let's do our best." And then... It was a surprise, but it was intentional. So this was a collaboration between Spielberg and Kubrick, right? Spielberg adopted a Kubrick script and he really didn't want a lot of people to know what it was going to be about or the final implementation. So we did have the script, but it was a version like 10 versions back. And so it was very, very different. But by design, like that was part of their kind of surprise marketing was like, nobody actually knows what this is until we're ready to show you. Unfortunately, we were some of those people. Makes it rougher for the game designers, man. All right, so we have to cancel all the games. It was really... We'd spent a year building these things and... I was sitting down with Jordan, like basically crying. This is the worst, like everything we worked on is getting canceled now. But we thought, "You know, remember that glue? That was pretty cool. That narrative was really, really good." And by glue, you mean so the narrative connective issue that was woven by Shana? Am I right on the script? By Shana and Stuart, yeah. It was, again, this just beautiful story. It didn't have any engine associated with it. It was just like a few hundred script pages of this story of characters that lived in the same world as AI and went through it with them, landing from set piece to set piece to set piece, which at the time were the Xbox games. And we thought, like, even if you remove the Xbox games, this is still a beautiful story. And I wonder if there was a way to put it out into the world. And I remember I was sitting, again, like heartbroken with Jordan. We were at a sushi restaurant in Seattle. I was saying, "Oh, there's got to be a way we can put out at least that story, at least that." And his phone rang, and he looked at me and he said, "What if that was the story calling us right now?" And my brain just exploded. I was just like, "I have no idea what that means, but it feels really significant." And so then we sat down and we started building what is now known as the first alternate reality game, Four Warner Brothers, Four Spielberg, because we still had this contract. We canceled all the games that we had to deliver something for marketing their movie. And so we decided, "All right, what if we take this beautiful story, cut it up into a million pieces, hide it all over the planet, and let players reassemble it." And the finale of our story is the launch of the movie, which turned out to be called The Beast. Yeah. Amazing. What a great story. Thank you for sharing that. Yeah, so fun. So you have such a broad spectrum of experience with games and interactions of all different types.


Hate playing Candy Land with your kids? Design new games with them. (01:23:06)

And a human with component player with player, there's such a multi-factorial set of experience you have. Right now, you have this company, you have many games. If you were able to operate under a pen name and make a game, it doesn't have to do at all with exploding kittens. Is there some game that you're like, "God, if there were a way, if I just had the time, if I could have my druthers, a type of game or anything, maybe you don't want to share it, or who knows?" But is there something you're like, "God, I wish this existed in the world, and I would make it if I were just in a slightly different spot." All right. I'm going to tell you something I'm not allowed to tell you, but I'm going to tell you anyway. Because, man, you set me right up for this one. Here we go. So I have two kids. I have a five-year-old and a one-year-old last year. My five-year-old was four. And of course, I tried playing games with her. I hate playing games with her. Hate it. It is because the games you can buy for kids are awful. They're like the worst game. I have to play Candy Land one more fucking time. So I dread it, right? And she's having a blast. She's getting attention, so she loves it. And she's like, "Daddy, can we play again?" And I'm just like, "Oh, please no. Anything. Anything but play again." I started thinking this feels really broken. And you know when someone like Eddie Murphy disappears for a while, and then he does a bunch of kids films, and everyone's scratching their head, and they're like, "Why do you do a bunch of kids films?" That's not what we know him for. All right. I'm about to tell you that story. So I started thinking about why are kids games so awful? And what I realized is the model is wrong. What if the model instead was like Pixar, where I knew you were going to go to Pixar? Oh, so good. So what if the kids can have an experience that they love, and the parents can have a different experience through the same toolset that they love as well? And so for the last two years, every night with my daughter, we get out the paper and the stickers and the markers, and we just make games every night, every night. And we made, I don't know, 20, 30 of these things. But a few of them are really good, like really good. And she helped me design them, and we worked, and we play them all the time. And now she's sharing them with her friends. And I don't want to insult your daughter's intelligence, but she's five currently, right? And I mean, it's quality time. So it's not like you're like, come on, pour it together. You need to earn your keep around here. What does this look like? But how do you interact? I think this would be helpful for parents, even if they don't care about game design. So my daughter is still in that phase where like everything is about her, right? Like she has no awareness if I'm having fun or not, right? Everything's about her. Like there are a lot of adults who are still there. Fair enough. Yeah, I can tell you stories there too. The interactions with her, the game design is like, how do I make sure that she's being celebrated that like she is winning a game? But for me, what's going on in the background is I cannot let her win. I have to be trying my hardest and she has to beat me anyway. Okay, that sounds hard. It's like severe, handy camping. It's really hard. And we went through a ton of games where that wasn't the case, where I found out I'm letting her win again. Let's scrap this thing and try something else. And we eventually ended up with a handful of games that all satisfy that criteria. That I don't let her win and she wins anyway, that I'm having a blast. She's having a blast. And the best thing is like at the end of it, she says, can we play again? And I'm like, hell yes. I'm so glad you asked. Yes, let's play again. And the part I'm not allowed to tell you, but I'm going to tell you anyway is this little five year old is going to have a handful of games in retail this coming year that she helped design. Oh, that's so cool. That's so cool. Oh, man. Getting the dad gold. So much fun. When she's a teenager and she's like, I hate you, dad. And you'll be like, never forget what I did for you. She's got such a skewed perspective. Like imagine if she thinks this is just normal. This is what all families do, right? You just, you make games and you put them and you put them in a store. I'm just imagining she's at the bouncy castle at her friend's birthday partner. Oh, yeah. What are you up to? You having fun? Yeah, I decorated a cake. She's like, oh, that's cute. Yeah, I have three games at Walmart. So speaking of sales, it's going to be an abrupt awkward transition.


Growing Exploding Kittens from a game into a company. (01:28:03)

But I bookmarked something you said earlier that I didn't want to interrupt with at the time. But when you were talking about the first three to four years of games coming out of exploding kittens, direct to consumer, and then adding to Amazon. And you had a line, there was something along the lines of Amazon eclipsed, quickly eclipsed our ability to sell our own games. Is that because when people would search for them, just making this up, exploding kittens, the SEO was such that people would be taken to Kickstarter. Most people are unfamiliar with Kickstarter. Therefore, the conversions would be very low. But once it's on Amazon, which also functions as its own search engine, but happens to have very good discoverability on something like Google, that it increases sales or is there something more to it? Everything you said is true with one extra point, which is when a Kickstarter campaign closes, the back this project button changes to a link to a website. So now there's an extra barrier to entry. You go to the Kickstarter page, you click this thing, it takes you through to another page, from there, you got to navigate to where the purchase button is. That was too much for people. And Amazon is just, here's the buy button right here. Do you have any idea, I mean, this is going back to the archives I know, but it just occurred to me that probably their recommendation engine could not have hurt you. If you like this game, you may also like exploding kittens. But I don't know if that was a rounding error, or if it ended up adding up to significant additive sales. Do you have any idea? I actually don't know for sure. What I know about Amazon is, when we launched, there were so many stories that had come out about the phenomenal success on Kickstarter that worked to our advantage was, here's this incredible thing. More people back this than any other project ever. And it made all this money and you can't have it. That was the story, right? Because there was literally no way to get it. You missed the 30-day window. And so, when we finally said, "Hey, it's available on Amazon," we had some like 20,000 orders in the first hour. Wow. It was just nuts because suddenly it was, "Alright, well..." Nothing attracts a crowd like a crowd, right? I mean... That's exactly right. Because the launch itself became a story that helped to further perpetuate the sales. Right, so now we've got 20,000 orders in an hour. Now we're at the top of all the search results on Amazon. You search for the word "game" and it's all exploding kittens, right? Because the algorithm feeds on itself. So, I cannot claim any credit for that. That worked in our favor perfectly. All we did was just take full advantage of it and just kept leveraging it. Okay. Exploding kittens, lightning in a bottle. Holy shit. Now what? And you build this company, which we could spend dozens of hours just discussing the company building process. One of my questions for you, because again, this is serving my interest because I'm curious in all of this, but you don't necessarily have to name Voldemort and the things that you don't like, although I'm curious. Maybe another time over our glass of wine, but with the success of exploding kittens, no doubt you had a lot of inbound from people who want to option it or adapt it for different uses in all sorts of different media and formats and so on. As a company, probably at some point, there was at least a discussion of how can we expand this franchise without damaging, maybe even strengthening our core business? What might that look like? What paths of exploration have been most fruitful or enjoyable? Oh, I like this one. Okay. So, we deployed the same principle after Kickstarter as during Kickstarter, which was we got to stay focused. For the first little while all it was was we must fulfill every single order. We made a whole bunch of promises. We thought we were shipping out, you know, a few thousand games. We have to ship out 700,000 games. We're very first order. That was our literally our first purchase order. And it was like, okay, well, that's really hard. And so we got to first figure out logistics, we got to figure out warehousing, we got to figure out everything, everything. Customer service, tracking. I thought we're going to fulfill this out of my garage. I'm going to invite a few friends over, I'll order some pizza and beers, and we're done. And 700,000 units is like an average game will sell, you know, maybe 50,000 units a year, and we're doing 700,000 in 30 days. Like it's just nuts, absolutely nuts. So the first thing was stay focused. I'm so happy to say we delivered every single one of those items on time with the exception of the orders to Russia, which is a whole nother story that makes me very upset. But we got them out there. We got, I have to tell you the Russia story because holy crap.


International shipping nightmares. (01:33:08)

So we didn't have many. We had like 16, maybe 20 orders in Russia, and we shipped them all out. And then we started getting these, these emails from our Russian backers saying, I never got my game. And we're like, wait, you definitely got your game. We got the confirmation right here. And they said, no, never got it. All of them. Nope, never got it. So I call up the customs, there's a special name for it. Customs in Russia, essentially, all of them go through this one warehouse. And I said, Hey, I'm trying to track down these 16 orders. What's going on? And they said, Oh, yeah, those were never delivered. And I said, well, I've got the confirmation right here that they were delivered. And they said, Oh, it's illegal to import games in to Russia. So our policy is to destroy them and then mark them as delivered. Oh, wow. Illegal to import games. I never figured that one out. Yeah. There must have been some some very interesting, political pissing contest going on. I can't even begin to wrap my head around that one. Like of all the things to consider a threat, this little kitten based card game. Like, yeah, I will say though, I have heard many stories of first time or yeah, in many cases, first time game designers getting themselves into into financial difficulties, because especially if they have a predominant overseas backer base, when games are inspected, damaged, having holes punched through them. And then you can get yourself into a sort of accounts receivable accounts payable problem. It's such a huge problem. People underestimate, oh man, shipping and insurance on that shipping is so expensive. And everyone expects it to be free or nearly free. And when we when we show people the bill, we're like, look, the game costs 20 bucks, but it costs us $150 to get that thing to you. And they're just like, well, I'll pay 10 of it because that's what shipping costs. So it's really hard, especially for new game designers. Can you not that I'm recommending people do this, but presumably you can constrain your geographic range on Kickstarter so that you can minimize some of the complexity here. And I say that this is former life, but I mean, I've shipped hundreds of thousands of units with my first business, real business, which was a sports nutrition company. And the stuff that you run into, right, especially if something has in this case, reasonably high retail price and somebody it gets shipped, let's just take Canada as a simple example, because shipped to Canada. Okay, fine. You might say it only costs, well, I'm throwing this number out. It's it's, I don't know what it is right now, but let's say it's $30. Okay, fine. So if you got a way to cover that, but then it lands at their door and they say, well, based on this price, that customer, yeah, you need to pay us this edition. Yeah. And then if they don't pay it at the door, they cannot accept the shipment. And now you know what you've just made, you've just made an enemy, right? Because they're like, yeah, what the fuck I already paid you for shipping. And now I had to pay this additional and and it is endless. It's endless. I hate shipping so much. So much. Yeah, so don't underestimate the challenges of shipping folks. You really need to plan in advance for how you're going to handle a lot of these eventualities. Coming back to, you know, this could be an antiquated interview, but I was looking at some notes from a past interview that you did.


Why an open-door policy had to be shut. (01:36:37)

And I'm just going to read here. Maybe it's changed, but we have a completely open door policy when it comes to new games, designers pitch us games in person through our website via email over Zoom every day. And you mentioned you're looking for games that have a strong gameplay loop, simple enough, etc, etc. It's some of which we've discussed. Has that policy changed? That seems like you could have a tremendous amount of yet had to, right? Let's just say even at that time, though, what are some of the other things that you would be looking for? Because there must have been other tent polls you were looking for if you're getting a lot of unsolicited submissions. I made this really bad assumption, which was that people who have game ideas have good game ideas. And so the things that we got through the door were like, "Hey, when I was a kid, we used to play this game and I don't remember what it was called, but it involved three cards and you're trying to collect four. So let's partner up on it." And I'm just like, "Okay, I can dismiss that one email, but oh my god, there's like 200 of these a day and I don't have time to do my real job." And so what we had to do was hire a very talented group of people to go out and get the games from things like conventions and there's a bunch of inventor meetups and local meetups and things like that. They filter them, they show me, honestly not that many anymore, maybe like 10 a month and they already know what I'm looking for. I've said no to so many of them that now they understand exactly the sort of thing I'm looking for. What are some of those things? It's a lot of the stuff we've discussed. Honestly, the core thing that I'm always looking for is our players entertaining each other. And that's the biggest fault I find in almost everything presented to me is I made this thing. It's really beautiful. The game is working so hard to entertain the players. And my response is always like, I don't care about those kinds of games. I don't want a game to be in the spotlight. I want the players to be in the spotlight, stop showing me games that are working this hard. And it's hard. It's really hard to find. It's a great example of focus and positive constraints. I just want to underscore that, at least from my perspective as I hear you describing this, because if your charter is to create great games, you're fucked.


Employees and their roles. (01:39:03)

It's just so broad. How are you ever going to implement processes? And the follow up question would be for me, at this point, how many employees do you guys have? About 100. Okay. Is it necessary to go scouting for games? Is there a cost advantage to doing that versus just whipping those geniuses in house, feeding them twizzlers and coke? Yeah, that's right. A little hamster wheel. Yeah. Okay. So 100 employees, let me talk about what those employees are doing, first of all, and why we went up to 100, right? Yeah. Because we started with two or three. And for a while, we were outsourcing everything. The process of making a game is not only, okay, we got a design, we got a PDF. Here's all the art. Here's the rules done. Send it off to manufacturing. After that, we outsourced everything. We outsourced the company that manufactured them. We outsourced the company that would then transport them from that plant to a warehouse. We outsourced the sales channel. We outsourced the marketing channels. We outsourced just absolutely everything. And what Matt and I decided to do was just, we've got this incredible opportunity. What if we just tried to learn from this as much as we possibly can? What if we just try to be experts at everything just to see if we can find the failure points, hire smarter people to then fill those gaps, but remove the reliance on external houses. And so most of those 100 people are sales, marketing, production, logistics, distribution, accounting, legal, nothing to do with the actual creative side of the company. Because that we can do with a very small team. It's all the other parts that we decided to try ourselves, failed at it, hired way smarter people, and then built those teams in house. And it just, it helps us become masters in this field. It helps us not have to do what other companies do and instead kind of blazer on trail and figure out like, okay, perfect example. The exploding kittens box is pretty small. I want a huge piece of cardboard around it. If we had a bunch of external dependencies, we'd fall into the same category with every other game. Nobody gets treatment like that. That's impossible. But now because we're dealing with Target and Walmart directly, literally calling them on the phone every day, and we deal directly with the manufacturer. And we own that cardboard stock. And we own the ink to put on that cardboard. Now we can have really interesting conversations with them about like, what if we put this thing on yourselves and we think it'll increase sales in this way? And what if we put a little secret component in the corner that, and we'll do a whole marketing campaign about people finding that, it's a kind of conversation that nobody gets to have in this industry. And the only reason we get to have it is because we are an end-to-end house of which very few exist in the world. So end-to-end house has a lot of sort of vertical integration advantages, let's say. Yeah, not risk-free. No, right. 100 mals to feed, amongst other things, right?


Achievements And Future Expectations

Milestones. (01:42:34)

Yeah, 100 mals to feed and it takes fuel to grow. For people who are unfamiliar, could you just give us some milestones in terms of funding and everything else? Because it's a rarity. As far as I can tell, I mean, it's certainly not something that I've come across a lot, and I'm relatively new to the space, but this does seem to stand out. So I've started a bunch of startups. This is, I think, my fifth or sixth. And every time, the milestones are always like, "Hey, we got our seed round, our friends and family round." And, "Hey, we just got this retail channel. We just got this distribution deal." For this one, it was really weird, right? Because we, for the first few years of the company, we owned 100% of it. And we had no one to answer to. And we had, instead of us going out saying, "Please, please, please sell our game." We had people knocking on our door saying, "Please, please, please let us sell your game." And so the milestones were really strange. It wasn't, we accomplished this thing. It was, we allowed somebody else to do the thing that they were asking for, to sell our game, to distribute our game, to market our game. And it went that way for a long time. We had a bunch of people coming in saying, "We want to invest in this thing." And we had this incredible luxury to say, "You know, money is the one thing we just don't meet. Like, there's all kinds of stuff we do need, but money is not it." Yeah. So this was maybe the first big milestone. One day, this guy, Peter Turnan, came to our office.


When big asks get big results. (01:44:05)

Legend in Hollywood. And he said, "I really want to invest in your company." And we said, "Yeah, no thanks." And he said, "Hold on, just hear my pitch." And he said, "You are at the top of your game. Like, you've done all the things you should be doing. You've grown as far as you should absolutely grow." But the next step is to stop being a game company and start being an intellectual property company. And what that means is TV shows, movies, and theme parks, and it turns out, "I'm probably the best in the world at those things." And Matt and I kind of huddled up and said, "Yeah, that's exactly right. Like, this is a really good point. One that we had never considered. We don't know how to grow beyond this point. We've done this as big as we can." And so we took an investment from the Turnan group. And that was a huge milestone for us. We had never had partners. We had never given away anything. And suddenly we did. And I would say we spent like 12 hours fretting that decision once we signed the papers thinking, "What have we done? No, no, there's another chef in the kitchen. What does this mean?" And then Peter called us up and he said, "Okay, if you could make a TV show, who would you want to make it with? Who's the top people in the world?" And both of us, without hesitation, were like, "Oh, well, Mike Judge and Greg Daniels." And again, those two people are worth Googling. That's Beavis and Butt-head, King of the Hill, the office, office space, holy crap. The absolute best people in the world. We're like, "But we know." And he said, he's like, "Whoa, that's a really big ask." And we're like, "Yeah, we know. But you asked who would be our number one choices." So there it is. And he said, "Okay, cool." And he got off the phone. The next day he called us up. And he said, "Can you come over to my house this afternoon?" Well, I really wanted to chat about this TV thing. And we said, "Sure." And we went over to his house and sitting in his living room on the couch where Greg Daniels and Mike Judge. And they looked at us and they said, "Peter tells us you've got this really cool game that you want to make a TV show out of and we should be the executive producers. So can you please talk to us about it?" And it was at that point when Matt and I stopped writing. It's one of those Spielberg walks into your office moments. Yeah, right. It's just like these superpowers that some people have, being able to align with them and saying like, "Look, together the sum is greater than the individual components. Peter's superpower is that networking. Our superpowers, we've got this really delightful IP. Maybe this is a chocolate and peanut butter moment." And it turns out like... And it really was, right? Did you say chocolate and peanut butter? I did say chocolate and peanut butter. Getting all European. So the punchline here is like, "Now we have a Netflix show in development." And it's executive produced by Greg Daniels, Mike Judge, and Peter Turnan. And that's a holy crap where this little startup that started in my garage trying to raise $10,000. And now we're at the absolute top of the game. And that doesn't happen on our own. There's no way we could have hit that on our own. That was a huge milestone in us realizing it's okay to give parts of this thing up as long as we choose really wisely, as long as it's people who share our vision and want to make this thing bigger than we could on our own. Yeah. So for people who are curious, the Turnan group is TCG. TCG.co/portfolio will give you an idea of some of the properties/companies and people they've invested in. They're a lot of very good ones. And I see here, Food52, which I know, also Mediter, which I know because Steven Rinella took me on my first ever home. Oh, that's awesome. I'm actually in one of the episodes where we went to Alaska together. Exploding kittens is right next to me here. Then you have Houdinke, which I know because my friend Kevin Rose used to be a CEO, Barstool Sports. And it goes on and on, Rooster Teeth, which I've actually been to their offices. I know those guys, I don't know them well, but I've been there scopally, which I've actually been looking at more closely recently. Hello Sunshine, which some people might recognize Reese Witherspoon. They've had very nice outcomes with Hello Sunshine. And it goes on and on and on. So these guys, much like you, are good at focus. They have very particular types of companies.


Investor expectations. (01:48:42)

Now, I don't know if this is public. It might be, but how much money did you end up raising? I don't know if it's public, but I don't mind saying we raised $40 million at that point. Okay. So you raised $40 million. Now, this is a world not specific to the Turnan group, although I'm in some of the same companies. But I've invested in a lot of mostly seed stage or series A stage companies. But with that money comes guidance, it comes health. There are certain also expectations that they have as professional investors. How does that play out? Okay. So first of all, it's important to say that $40 million is still sitting in our bank account because we just didn't need it. So it's sitting there, but it was important to have as a signifier. And just to say, it's not so much the money, but once they have a portion of the company, their hope is at some point to have a liquidity event. That was really important for me to understand. Once you take on an investor, it is not a matter of if you exit the company, it's now a matter of when you will exit the company. And that took me a second to understand. Now the Turnan group is on board. And now we have to have board meetings. That was a new one for us. And our very first board meeting, so one of the partners at the Turnan group is a guy named Jesse Jacobs, one of the smartest people I've ever met. And we sat down with him, we're like, here's our first board meeting, here's our presentation. And at the end of it, he said, that was the worst presentation I've ever seen. Yeah. And we're like, okay, well, we really did our best. We clearly don't know what we're doing. And so we, like to their credit, we worked so closely with them after that. He's like, okay, you get them all again. Like, we're going to do this thing over. But let us train you, let us work with you, let us hook you up with experts, let us show you other people's board decks. And you'll see what a healthy company looks like, because you two have been incredibly lucky. And you have to plan on that not lasting forever. And they were totally right. It was really important for us to kind of gain that new muscle and hire a new group of people. We hired our first ever accountant. We hired a CFO. That was a very new thing for us. Wait, wait, wait, wait. You did not. And so you're going in QuickBooks. I mean, what's going on here? If you guys don't have an accountant. Yeah. Well, I really love Google Sheets. And so I literally wrote everything myself. Holy shit. Yeah. That was our first five years, like, just that. You must have had a lot of free time. Yeah. I would call a free time. I would say I had a lot of lack of sleep. That's what I'm saying. I'm saying. All right. Okay. All right. So you get your accountant. Do you start getting systems in place? Start getting systems in place. And we start figuring out, like, I think the turning group and Jesse specifically really started to lead the charge in terms of like, okay, you want to be good at everything. What does that actually mean? Who do you have to hire? What are the milestones? I remember telling them, we want to try everything. And if we fail, we'll get help. That's how we'll know what we can and can do. And they said, great. What is failure mean? And I thought, Oh, shit, I haven't thought through that definition. And they just forced discipline on our company. They didn't impose anything. They said, look, if you want to do it that way, we will support you. But you haven't even defined your terms yet. So let's start there. And it was so helpful. It was so helpful. God, I love those guys. Like I said, a lot of startups, a lot of investors, I have never sung an investors praise like that before, because they just held our hand. They're just like, we support you. We believe in you. Let's do this together. Do you provide equity incentives to employees or is it predominantly salary based? We provide equity to all employees. Yeah. Okay. And feel free to plead the fifth or whatever the legal is on this. But I'm curious because I'm deeply interested in how startup founders navigate decisions like these. What percentage of the company did they buy in their strategic investment? Or it could be a range. I'm curious what the appetite looks like. That also starts to inform the dynamics that are at play after the investment closes. I'm specifically not allowed to say, unfortunately. But what I will say is, what was very important to us is any terms of any deal that we signed with anybody, we remain in complete control of the company. We're interested in help. We're not interested in having bosses. Okay. So is it fair to say they might approach it like a private equity investment, but you want to ensure that you as equity holders are in a position to still retain control of the company? That's correct. Yeah. Yeah. Okay. So you have a tiger by the tail, man.


What kind of retirement does someone who makes fun for a living envision? (01:53:43)

Yeah. I'm not going to dig for more specifics, even though I'm super, super interested personally, because it's kind of part of my education too. We can talk offline, how's that? Yeah. Yeah. That's fine. Let's say this 10 years from now, 20 years from now. At some point, you'll be like, you know what? The seasons of my life, they are changing. My daughter now has 20 more hit games than I do. It's time to hang out my spurs when you have like all the Skittles that money can buy, and you're or just you're satisfied. Yeah. You've checked that box. What do you think you'll spend your time on? Let's just say you're no longer running a company of this size. Yeah. What do you think you'll do? I think the through line between all the companies I've ever started that have kept my interest for the longest is empowering a community. I love doing that through story. I love doing that. I really hate it when a spotlight's on me. I just get shy. I get weird and uncomfortable. My proudest moment so far has been, I was in an airport and the flight was canceled. The flight was delayed. It was so late at night that nobody could get a new flight. And so we had this terminal of all these grumpy people. Everyone would, they were just like, you know, getting on the phone, trying to find new things and get in turn down and we all realized we just have to sit here for like four hours and it sucks. And everyone was complaining and there's this horrible negative energy. And except for this one group of kids sitting on the floor in a circle, just laughing their asses off. And I couldn't help but go over to them and look over the shoulders and see what they're doing and sure enough they were playing exploding kittens. And it was like this unbelievably beautiful moment for me. And whenever I tell people that story, they always ask like, did you tell them who you were? And the answer is, of course not. That's the opposite of what I want. Like, I am so delighted that I could give them a tool set to laugh with each other and have this horrible experience transformed for them into a positive one. And I do not want any credit for that at all. I just want, I loved getting to witness that. We'll set aside for a moment in the fact that, you know, here's this 40 something year old guy staring at a bunch of teenagers at an airport. But for me, it was a very nice moment. And so when I think about what comes next, it's like, I want more of that. I want more of tool creation to create those like just little pockets of joy. And I have a lot of ideas on maybe how to do it, but I don't know which one is actually going to going to be it. So one of my family worked at a chocolate factory. And at one point, they went in loving chocolate. And at some point, they just had too much chocolate. And it developed a different connotation. So I'm curious how you have preserved the desire and I don't want to say novelty, but the freshness of what you just described in face of building a company that leads you to think about games outside of having the experience of sitting on the floor with your friends. Right. I once took a skydiving class, like a week long skydiving course. And at the end of it, I asked the instructor, I was like, do you ever get bored of this? And he said, do you ever get bored of having sex? And I thought, that's exactly it. Like, that's how I feel about games. Like, that's how I feel about this job. It's not a thing with an expiration. It's a little dopamine factory for me and the people who get to have these experiences. I don't know how you get bored of that. That's just eternal. Yeah. All right. Well, I suppose yet another vote for more games in people's lives.


Conclusion And Final Thoughts

Dance partners, algorithm defiance, and other parting thoughts. (01:57:48)

So, Lon, we've covered a lot of ground. We've certainly gone in all sorts of different directions. Is there anything else you would like to add? People can find exploding kittens and explodingkins.com and everywhere, of course. And there are some social links, but you're slowly ratcheting back on those, which I think will be best for your mental health, longevity, and pretty much everything in life. Is there anything else that you would like to add any requests of the audience closing comments? You know, something I've been thinking a lot about lately is I've become enamored with partnerships. All the best things that we're making now are collaborations with somebody else way smarter than me with really interesting perspectives. We just made this game with Pendulate from Penn and Teller. And it's like, what an amazing brain. I can't believe I got access to that for a few months and got to play with him. And what I thought about since then is we as a company, exploding kittens, have this really unique ability to say, "All right, smart people out there, all right, people who have built followings and built audiences." You know what's a tough statement that you can't make on your own? I made a game because it turns out it's really hard to do. And I'm really proud to say that we enable that. If you have a conversation with me and we go down the path for a few months, I can let you say that. And that's been so satisfying lately. We're doing a few of those, and it's just been, "Ah, it's so fun." For a guy who gets very shy in social situations, using that is my calling card. Oh, man, I am so set up for success now. I wish I had thought of that earlier. There are many different types of dance partners. I mean, Pendulate is amazing. He's been on the podcast. I was looking. It was I think 405, several hundred conversations ago on the podcast. But what are your ideal dance partners? What are the characteristics? It's really simple. It's people who love their audiences. And maybe that sounds trite, but like so many of the people that I encounter do not. If your audience is a tool for you to gain money, if your audience is a means to an end, it's not interested at all. But for those who are like, "I cannot help but entertain these people." If I made nothing, I would still entertain these people. If I had no stage or audience, I would still do this exact same thing. Oh, I love those people. They speak my language. We just go on for hours. So that's my absolute favorite. So if somebody's listening, they're like, "Hey, I think that's me." Yeah. What do they do? They reach out. They write to, let's see, what's the easiest one these days? If you write to just support at Exploding Kittens, that's like this really lovely group email that goes out to a whole bunch of people, I guarantee it'll make its way to me. All right. There you go. You heard it here. All of those audience lovers out there. And there are some good ones. I mean, there are, I will agree with you that it is not everyone. I would say it's actually probably even on the smaller stuff. Like if your audience stopped delivering any financial value to you today, $0, can you derive from this audience? Would you still engage? And I think the answer for a very high percentage is no. Absolutely right. The love is conditional upon financial outcome. And I understand that if you are making ends meet and having to focus on paying rent and sending your kids to school and so on, like there are an assessed season life, I understand that. However, the cult of the influencer, I find to be a real amplifier, funhouse, mirror tendencies in human nature. I do think it's a very distorting playing field in a lot of sense not to take this off in a strange direction. You're going to start a whole other hour here. All right. Good. Yeah. Well, I was just going to say that what I think folks need to be very cautious of is even if they start off with the most sincere of intentions, if you are not explicitly aware of and take steps to counter the seduction of the algorithm, you will be rewarded vis-a-vis your audience by more and more extreme characters of yourself. And you will therefore get propelled into becoming a mask. I've seen this with dozens of people now where they used to be fairly moderate in their views, their expression, their justiculation, their volume. And now they've painted themselves into a corner. Sometimes they don't even realize it where the personality that their audience in a sense and the platforms have shaped them to be is what they are. And that's a very precarious place to be, especially, and you've had this experience, if you're on a platform where you do not own direct means of communicating with that audience, and if you have your organic reach throttled and suddenly 70% of your positive reinforcement goes away, that is a risky business financially and psycho emotionally. Psycho emotionally, especially. Tim, so well-phrased. Like the reason that I've dropped off of most of social media, honestly, is because it feels like that's a precarious place. It feels like it's so easy to be there for the wrong reasons. It's so easy to, by nature, retracting the wrong people, let them shape who you are, let them shape the products that you make. Yeah, I just, I don't see the value in it anymore. And I'd rather just surround myself with fun, loving, amazing people who are nurturing and help me make amazing things. Amen. That is where I hope to focus more in the upcoming year. And I haven't had any social apps on my phone. Actually, I've had one. I reinstalled Twitter to be on someone's Twitter spaces, but that'll probably come off soon. Have not in any social apps on my phone for about two years now. Because I do not believe that 99.999% of people out there can overcome armies of data scientists and extremely effective algorithms with self-control. I don't think it's possible. Don't be that person who's like, I don't think I'll get addicted to heroin. Let me just try it a few times, right? Chances are you don't have an immune to bracelets. So build, build, build. All right, man. Well, this has been really lovely, so nice to connect and spend time together. Thank you. Such a delight. Yeah, really, really enjoyed it. And I will just say to everybody listening, as per usual, we will have links to everything we discussed in the show notes at Tim.blog/podcast. E-L-A-N. There are no other guests on this podcast with that name. So if you go there and search, you will find this episode in the show notes. And until next time, just be a little bit kinder than is necessary. Build more, talk less, and have some fun folks. Get off of screens, play some games. Thanks for tuning in. Thanks, Tim. you you you you you you you you


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