I think this is my first post in this thread. It’s been so glorious. Never in my wildest dreams did I think I would get so much entertainment out of this.
I take an interest in $$ and burn rates and I know lots of other people have run the numbers, and this is largely treading over ground others have done in the past, but here’s my take on it:
Looking at this from a dollar standpoint, and being very conservative. For example - $2M per month burden rate on 260 employees (where this Wired article says they had 320 back in March), and discounting the first year as they didn’t just hire 260 employees on day 1, they’ve spent about $60M on h/c alone. Burden rate is the applied cost of salary, buildings, electricity, insurance, desks, computers, etc. I have 60 employees spread over 3 geos, so I’m just applying my own burden rate assuming a 60/40 split over low cost/high cost geos - again erring on the side of caution to give CIG the benefit of a doubt. They likely have spent more, but hey, let’s assume small numbers.
So, they had $30M to spend on talent, advertising, making movies, bling, whatever. Now looking at Juan’s calculations he did a few pages back, he may have missed something - as the Wired article pointed above for the 320 employees, also states they had collected $77M as of March - meaning they are essentially pulling in almost $2M a month as an income stream (90-77 = 13 over 7 months).
So the real question is how much has been spent on movies, talent, bling, etc. because whatever is left is the cushion - assuming they can somehow maintain a $2M income stream, they could effectively operate in perpetuity and never release the game.
Tom or someone else might be able to shed light on the movie costs - that is probably the biggest chunk. Plucking an arbitrary number out of the air just for dartboard sake, let’s assume they spent $20M, so they would have $10M left over.
Taking that assumption further - If / when their income stream drops to $1M a month, they would have 10 months left before running out.
Or, they could have already spent the $30M and are talking to investment angels as we speak.
But then, if I were a investor, I’d be lining up to fund more at a huge discount rate. The large risk and $$ have already been spent, and they could get some really good terms on that. Hey, if I had $12M, I could get a good chunk of ownership out of it.
But - until their investment stream drops below $2M / month, there really is no point in trying to project when things are going to get dicey. Every time people start rubbing their hands and mischievously grinning, they somehow pull out another ship & sign up more citizens.
In the meantime, we get a glorious show! It’s wonderful!
