75. The birth of an industry with Michael Schmalz

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Transcript

Eric Morse 

Eric, you're listening to the entrepreneur podcast from the Western Morissette Institute for Entrepreneurship, powered by Ivey. My name is Eric Morse, and I will be your host for this episode. The global video game industry is a behemoth that is worth more than the music, television and film industries put together. That's not bad for a sector that was considered niche before the 2000s. As the former president of Digital Extremes, Michael Schmalz had a front row seat to these seismic changes. The London, Ontario based game studio started by his brother James, rose to prominence with international hit games like Warframe and Unreal. With a background in business and technology, Schmalz was able to ride the waves of uncertainty and opportunity to build a thriving company that not only delivered iconic games, but also shaped the way the industry managed projects and people. In this episode, Schmalz gives us a window into the gaming industry its history and what lies ahead. Thanks so much for coming. I always start with the first entrepreneurship. Was it always in the cards for you? Something you knew you wanted to do?

 

Michael Schmalz 

No. And it's interesting, because when I was reflecting a little bit about this, I remember when I was, I think about 11 or 12 years old, we one of the hobbies that we had is we used to build model rockets, sure. And at the time, you could buy the little cartridges that you go in, yeah, set them off, and they go 200 feet in the air. It was very cool, very cool. Anyway, we ended up and used to build them ourselves out of out of tubes that you get from paper towels and balsa wood, and then you pay. So we had a few of them. And it's funny because our friends, they were kind of like, hey, that's really cool, but they didn't want to build their own models. So they're like, hey, well, I'll build you one and sell it to you. And that was kind of our first, my first idea about, okay, there, there might be a business here, even though I'm 12 years old, right? Anyway. So we ended up doing that for one friend, we sold him, I think, a rocket for I'm going to say $20 it probably cost us $40 to make, and he didn't end up paying us for it. Oh, and at that, well, that's a lot of lessons all there exactly. At that time, I realized, holy cow, like business is hard,

 

Eric Morse 

As 12 year old. It's probably a good time to learn it

 

Michael Schmalz 

Exactly. So I would say I was, I was a little cautious kind of going into it. And I started off as as a consulting engineer in my career, before I came into to video games. So I wasn't really looking for entrepreneurial activities. I think you need to have a good idea. You need to have something that, that a you love doing that you 100% believe in and you know, once you have that, then you can kind of take off with the entrepreneurialness. So it wasn't until video games came along that and my brother started us down the road (right) to give him credit on that.

 

Eric Morse 

Well, how does it go? From this is fun to, you know around video games too. I Well, maybe we can make one. Maybe this is a business. How does, how does that happen?

 

Michael Schmalz 

Well, for for my brother, it was, I think, fairly simple. He programmed some video games, sent them out in the days of shareware, yeah, and and made a little bit of money, and got in touch with the right people, and ended up making more and had a in quick succession, a couple of big enough wins to really jettison him and Digital Extremes into kind of the video game industry, really, when it didn't exist in Canada in the early 1990s at all. So you know, after he got up and going and found that he had partners. He had identified his market that's and we're hiring more people. He was hiring more people. That's when he he asked me to come along, and I was primarily just to work on the business and the administrative side to make sure we're getting the tax credits and we're compliant and doing all of the things that businesses need to do while they were doing.

 

Eric Morse 

This is the 12 year old You coming out. We, this time, we're gonna make money.

 

Michael Schmalz 

Oh yeah! Exactly. And we're gonna take advantage of of all of the, you know, all of the things that we could, such as the tax credits and and make sure that that we didn't leave any anything on the table.

 

Eric Morse 

Okay, yeah, let's talk about the business itself, and then maybe we'll come back to talking about working with your brother and how that goes so Digital Extremes, London based company that's really had a global impact. You launched in 93 by your brother, James, as you mentioned, and down the road, a couple years there's a. Really successful collaboration with the US based company, and many of the people that will be listening may recognize who that is. So take us through that initial journey and then how you came into the picture, and we'll lead from that into maybe the working with your brother piece.

 

Michael Schmalz 

Yes. So one of the things that my brother ended up doing is he made a game called solar winds, and it went out and did did quite well in shareware. So that was back in the day where you could buy those games in the dollar stores, and they were really just kind of the cost of the disc, and then they would just put stuff on so if you wanted, you could buy a disc that had nothing on it, or you could buy some of these shareware games and delete the files on it and get your disk. Okay. So it, it was an interesting model that got things, that got content out there. But he was partnering with and met up very early with Tim Sweeney of epic mega games. So epic, of course, has gone on to tremendous things, right? With Gears of War for, you know, Xbox 360 and most recently, Fortnite. And now he's known because, you know, they're, they're extremely well capitalized. He's Tim Sweeney's, I think, a legitimate billionaire. And he's recently taken on Apple in terms of disputing their control over the Apple ecosystem. So that's a long battle. And I think you know, he's, he's fighting the good fight on behalf of content creators, not just video game people. And that was the collaboration that got us going, or got Digital Extremes off, and the first game that they, kind of we did together was a game called Unreal, which was a first person shooter back in the day when first person shooters really didn't exist. Now they're ubiquitous. They're literally, last time I checked, about 35% of all triple A games out there. So you know you know the call of duties, the bio shocks like, you know, they're, they're all first person. But back then that was relatively new. You had Wolfenstein and Doom that had kind of come out before us. But, yeah, that came out, I believe it was, is around 1997 98 I think was when that launched. And it did really, really well, followed up by Unreal Tournament, again, did really well. And those were games that were selling. You know, at the time, the retail price would have been about 50, $55 made by a team of 1213, people. And so they were selling $2 million so there was just so much money being made for the the the pinnacle of success. And at that time, you know, we were there, sadly, the the development agreements that that we had at that time with Atari meant that most of that money went to other people. And that's, that's, yeah, that's, um, that's something we can talk about a little bit later, about how, you know, money gets distributed in in the video game industry, but as an early company, we couldn't have done any better than that, sure. So early days, we had that success and got the credibility, made a lot of money, mostly not for us, and then that kind of jettison jettisoned us forward. And I came on in, I think late 2003 just as we were kind of planning for the transition to Xbox 360 which came, came in 2005 so we are eyeing up the next generation of of consoles to to launch into. And 2003 was also an interesting year, because I think that's when video games, kind of, in a global sense, really got recognized with a certain amount of legitimacy. Because the the famous quote that that video games make more money than the movie industry, right? That's the year we took that. Oh, really, the balance was 2003 at least in, in Hollywood, and for, for North America. Okay, so, yeah, so I came on it, I think an interesting point. Yeah.

 

Eric Morse 

Not long, and you're president of the organization, and, you know, your brother started this, I don't know what that discussion looked like, but how did, how did you kind of approach it, I guess, as you came into that role and working with your brother, and who was the founder of this business?

 

Michael Schmalz 

Yeah, so I'd been there a few years, it was, I remember I was surprised when he asked me to be President, because I started off as CFO, and that was, I thought I was doing a good job at that we had everything under control. And, you know, administratively. So when he said, you know, at that time, I think we were kind of pushing past, you know, 60 or 70 people in the company. And I was talking to him about, kind of the importance of some more robust Human Resource Management in the company, and just some more things that bigger companies would do when it suddenly becomes difficult to know everyone's name, because when you're a tight little group of 30 people, and you're kind of living in each other's lap building a game that's that's easier to manage than when you've got highly specialized people who are sometimes speaking different languages and and one of the things that I, I kind of noticed nice we spoke about early is that in you know, computer programming, design, art. If you have highly engaged people, their level of productivity is literally tenfold more than someone who is is is modestly engaged. And then conversely, if you've got someone who is is disengaged, their productivity is is zero or less than zero, they're actually destructive to the team in terms of, they're checking in stuff that requires other people to fix, or it's just not right, not paying attention. They don't care about what they're doing. So that was one of my goals early on, is to kind of monitor the health of the team in terms of kind of the individuals, you know, who's working out, who's disengaged, who's not? Sometimes it's, it was really quite easy to turn around people, yeah, in terms of, oh, they're not, they don't like their salary, or they don't like their co worker. Sometimes it's easy things to fix, sure, other times it's just impossible. And then, you know, you have to have discussions about them potentially being more successful elsewhere.

 

Eric Morse 

Yeah. You know, there was a bit of a change for the industry, though, that went through cycles of kind of hiring laying off as games got developed. You did have a different approach to how you treated your developers and staff in general. And I remember when you moved into what, at the time, was new space. It was beautiful and, you know, chefs and it was kind of the Google model, I guess is what we knew of it at the time. But can you tell me a little bit about that approach and keeping people engaged and happy with what they were doing?

 

Michael Schmalz 

Yeah, I think in keeping with that, that mission to keep people engaged is you didn't want to have people who are constantly fearful for their jobs. And certainly at that time and even now, there's, there's, there is a pervasive fear among video game developers that as you reach the end of a project like now, the cuts are coming, right? Send you out, and maybe we'll hire you back in eight months when the next project ramps up. Because that's the problem, because you have some very intensive work during production, like the middle phase. So you got the pre production, production, and then you've got the kind of the completion, I guess you would call it the last phase, the certification, the testing and the debugging. The middle part is the most intensive, where you need all of the artists on board. You need all of the designers, and that's when you need, say, a full team of 200 people working. All of a sudden, you go into your debugging mode and the artists are done. The art is done. You're just fixing the game. You're tweaking the gameplay. So what do you do with those people? So that was one of the things that we really tried to design the company around, having multiple projects and doing whatever we could to keep people employed so that they would not be, you know, halfway through production starting to worry about, you know, getting laid off, or, even worse, shopping their resumes around. Because, yeah, so we had one unfortunate moment there where we had two or three contracts canceled during, you know, during my tenure there, and we had to lay off about 35 or 40 people, and we ended up hiring most of them back. But other than that, for my 20 years, we we laid off virtually nobody. That's amazing and and I think I remember especially animators, because I think it's worse, because animators are almost all freelancers coming from the movie industry. Like, they don't have companies that make movies. They're just like, they hire a whole bunch of when they get the funding, they get the project, they do all the pre planning, and they bring the animators on for like, you know, 18 months to make it, and then the contracts are done, they and that's how the experience animators understood the industry. So they were, they were always grateful. But you know what? Everyone's grateful not not to be laid off, sure, and I think that that we got a lot of a lot of goodwill for that, and that was one of the key success factors, okay, that helped us get through some of the more difficult times.

 

Eric Morse 

Interesting we've talked about the culture and a little bit about the business model. Let's go back to the business model, and I know it's changed in 2030, years that you. Been doing this, but, you know, talk us through how independent gaming studios and publishers and how Digital Extremes was able to kind of really flourish in this very different kind of industry model.

 

Michael Schmalz 

Yes, so starting when I in 2003 2004 when I came on, we were just finishing off with our collaboration with Epic Games on Unreal, and then we were launching into into Xbox 360 consoles. We're also developing our own, our own game engine, which was also a big undertaking at that time. So that was the beginning of what I would call very, 10, very difficult years in the video game industry. And it's, it's basically a publisher model, where you would sign up a deal with the publisher, they would advance you through a number of milestones, you know, the the 1015, $20 million that you needed to make your video game and then you would recoup that from the sales. But the way you would recoup that was always in a way that was made it very, very difficult to actually earn any royalties. So you would recoup the you get a royalty rate at 30% and then you'd have to recoup against your advance at 30% so theoretically, if someone gave you $10 million to advance your your game, they'd you'd have to make almost $100 million right before in in gross revenue, before you saw anything. So I can say that for all of the games, and we had a number of very, very good games from from 2004 to 2014 none of them made a single royalty. Not a single does that right of the publisher games. They funded us. Thank God for the the Ontario tax credits, because they always paid out at the end of a project which was which helped us with those transitions and help keep people employed. So I don't think we could have done kept people employed without those tax credits the way I described. So we were able to ensure our continuity that way. So obviously that's not a great model for it for a developer, but that was the only way you got access to the the the to the Xbox. That's how you got your disc stamped. And in the stores, playstation xbox wouldn't talk to anyone who wasn't a publisher. So that model started to break around 2013 2014 and it was PlayStation that was first and more aggressive with their PlayStation store. You know, another thing that's happening was broadband internet was actually starting to get to the gigabyte level, which now meant that the digital downloads were were a thing. So now you could start thinking about making games that weren't necessarily, you know, 15 hour game and have multiplayer and have all of these bells. And so it was. It was a very tight box right in the PlayStation three generation, where your game had to, you know, be a certain thing, and it was going to cost a certain amount. You couldn't make a $20 game and sell it on the shelf, right? Yeah. But now with digital downloads, all of those possibilities became possible, and slowly, PlayStation and and Microsoft, Sony and Microsoft, began to liaise with developers so that you could bypass the publishers and get your game onto the store through a digital download. And that opened up a number of different things. I think it was a big Renaissance for indie games, and it allowed you to do $10 games or $20 games, so you weren't constrained to say, Well, I have to make a $40 million Game right over, you know, four years or three years, build a team and then hope it sells. I can make, I can make a $7 million Game of similar quality, but it'll just be potentially a shorter experience. And that's what happened to us when we proposed Warframe and we came out initially on Steam, so on PC, but shortly after we came out on PlayStation four, which was just launching at that time, and and that was, that was great. We we put it out there without any publisher, without any it was a self funded game, so we owned 100% so we got all of the money. Came back to Digital Extremes. The other thing that was was interesting, and I think difficult with that, was that it was set up as a free to play and software as a service. And that was a model that had started to work in in Asia, and it became this thing where it kind of took the piracy issue and turned it on its head. So. So you know, if someone's going to take your game and put it on 1000 computers, that's okay, go for it, get it out there, because if you want to play, you got to log into the servers, and you've got to pay. And in our case, you, and many cases, you didn't have to pay. You got five or 10 hours. So you whether it was pirated or or, or free to play. You really didn't know until you you started to hit the pay walls, or you started to see, potentially, the advantages of putting them the money in. And by that time, you know you've got your customer hooked on the game, I would say hooked, but you've got your customer interested and, that's the thing, and it's like, maybe he's not interested for $50 but maybe there's a little advantage. You can sell him for two or three. And I think if, if you know to give gamers the benefit, you know, if you got someone who enjoys video games as a consumer, and they're concerned with the health of the industry, they have to understand that there's, there's economics that go there. That's right. And I found with, I think, a lot of people who played Warframe, you know, they were happy to, you know, to buy stuff, to support our company and to ensure that the next generation of updates were going to be as good or better than the last one. So, so that was the innovation. Not a lot of people believed in it back in 2014 in North America. And I think that was, I think one of the great achievements for Digital Extremes is that, you know, we pulled it off. And Warframe now is in its, I think its 13th or its 14th year. It's done. 13th year, I think it's done. It still surprises me that it's, it's, it's got so much longevity. I think I was planning for a warframe two, or some sort of sequel, you know, two or three years, I was still thinking about the the traditional model, yeah. But this, this software as a service, if you can have a good connection with your audience have a good dialog, and if you can deliver new updates, you know, there's no reason that that that any video game, World of Warcraft, for example, Warframe, there's, there's lots of other examples. Can can keep going for a very long time, and that's when you think about it. It's that's not unusual, like, you know, back in the day, like, how many seasons did mash have? Like, people just kept coming back and watching it. So when you've got content that, that, that, that you know that really, you really, you're really interested in, I think that you just need to manage your your customers through that, and they'll stick with you, because there's, there's just real pleasure and coming back.

 

Eric Morse 

Now, some of our younger listeners won't know what M*A*S*H was, but I can tell them it was a TV sitcom on the Korean war that lasted longer than the Korean War.

 

Michael Schmalz 

Yeah, it was like 23 or some years or something. It was a very long running TV show back in the day,

 

Eric Morse 

Absolutely, absolutely in the most viewed final, I think, for many, many (Yes.) So I'm going to do this for the audience. If you were to pick three games that you think would be the perfect blend or perfect product that all studios aspire to, what would they be and what makes those three games special?

 

Michael Schmalz 

If I, if I had a really good answer to that, I'd probably keep it to myself, but the truth is, so here's, here's. The thing is that if you go back in the history of the video game industry, you you look there, there, there are few watershed moments in terms of of video games that have come out. One would have been the the unexpected rise of World of Warcraft in about 2003 or so when it launched. Then I'd say the way Grand Theft Auto kind of pushed things to the next level, like, you know, in terms of their colossal, colossal sales. I think most recently, the one that that that the video game industry would look to is was Fortnite, which was kind of repurposing of a battle royale in just such a market friendly sort of way, with some very good marketing, good management, good tech. I mean, they did everything, pristine, perfect, to make that game the global success that it is. I is. But that's been a few years, and we haven't seen a new game. So according to, you know, the people who analyze this stuff say, maybe it's not the academics, but it's the business and marketing people that are looking for the next best thing. They're waiting for this new one, that's going to be the billion dollar a month game that comes out and just captures everyone's imagination, and now they've got good data. They're looking at the trends, I think they would probably say that it's going to be a big budget game. It's going to be open world game. Game. And I think right now they're, they're leaning towards it could be like a fantasy RPG type genre, okay, but that's, there's lots of those games, and they're still making it's going to have to do something interesting. It'll probably be multiplayer these days, because that's what people and probably a competitive multiplayer, okay, saying similar to Fortnite, but again, how that's configured, and what that's going to be is, is, is really anyone's guess. And, and here's the thing, is that I think the investment, the way I'm seeing, the way I'm hearing is that they don't think it's going to come from a really well established studio, because, again, they're baked in their mindsets. They're baked in their trends, that it's going to or or a publisher, that it's going to come potentially, from an indie type developer and a little bit out of left field. And so, so, yeah, so I think...

 

Eric Morse 

Michael, I'm not gonna let you off that easy. Now, you've been at the forefront a number of firsts, and AI has got to play a role in whatever the next thing is, I assume. But you're already working on it. Aren't you?

 

Michael Schmalz 

Working on what? Oh, big one. Oh yeah. Yeah, I've got, I've got a few things on the go that, that, that I'm looking into. I think the AI is going to be a part of the future, because at the end of the day, you know, when you've got 200-300 people working on a video game for four years, it goes without saying it's extremely labor intensive, yeah, and there's a lot of mundane things. Everyone asks you about the creativity of video games. It's like, yes, there is some creativity in there, but that maybe, you know, I might say 3% at the beginning. The rest of it is all just execution. And when you say execution, it's got to be done right, right, but it's also got to be done efficiently. And if there's ways to do, you know, to build like, I need a forest with 1000 trees, but if I can press one button and in 10 minutes populate this entire forest with the trees, right, and do something that would have taken an artist a month or more to do and lay them all out that's helping me get to point B faster and even, arguably, potentially, with better quality.

 

Eric Morse 

Yeah, absolutely. So a major role to play. And yes, the creativity still has to be there.

 

Michael Schmalz 

The creativity, I think, will become increasingly important. So it's I expect it will go up from the 3% I just quoted, which is absolutely my number. It's not referencing anything. But I say that to emphasize the fact that that I believe that the success of most of the modern video games is not in necessarily in the creative part, it's in the execution. And I would take a bad idea, well executed any day before a good idea, poorly executed.

 

Eric Morse 

interesting. I'd say that for a lot of businesses, for sure, 2020 was a big moment for you guys. Digital Extremes was acquired by Tencent, who people probably know from WeChat. Was it the right time to make that move? I mean, it's, it's what it what it is, but talk about the emotions involved, and why then?

 

Michael Schmalz 

Yes, I mean, for Digital Extremes, it was the right time. The year 2020, what was interesting? Obviously, we were kind of heading into COVID when that happened. And it had basically come at the end of two or three years of a real large amount of mergers and acquisitions and consolidation in the video game industry. And then it culminated with COVID in 2020 and 2021 which kind of gave a bit of an artificial boost to the video game industry, because people just had more time and more money to play with some of the subsidies that everybody was at home, yeah. And so just a very interesting time. So we got a really, really good valuation, like the deal, and again, it was mostly other people's money, because deep had been sold before that. But, yeah, it was absolutely the right time for for Digital Extremes to be sold. You know, I think 10 Cent who bought it, they've got plans for it. One of the reasons why they bought Digital Extremes is that they believe that it was the type of studio that could potentially incubate that next big global hit, yup. And I honestly believe that it might be one of those. So. So if that were to happen, you know, now, or in the next five or six or whatever, years, then that investment will have paid off, sure, really, really well. Um, they invested in and got a little bit of Fortnite, so they made some money there, and now they're looking at, at investing in, in other game companies that might be responsible for those types of global things. So the short answer to your question, yeah, it was, it was the right time. The valuations were good. The market was, was hot. There was, there was a lot of interest in video game companies, because I think by that time, we were kind of the last one left on the block. And there was, and there was a huge appetite to scoop us up. And we were, we were interviewed by everyone in the industry came in to to talk to us during that year, up to final offer and sale. So it was, it was definitely an interesting time.

 

Eric Morse 

Yeah, I'm sure, Michael, I know you're someone that that loves learning. Six degrees, including a PhD and three masters. I think you've done executive education. What? What? What fuels that? Is it straight curiosity, or is it something more?

 

Michael Schmalz 

Yeah, it's definitely curiosity. I think most of the things that I've undertaken was was was scratching an itch. It was information that I wanted to know, I wanted firsthand, and then I wanted the credibility to be able to repeat it to other people and be believed, sure. So for me, you know, the formal education route worked out really well. Most of those degrees I did in my spare time, so I was able to carry on with my career. It was a lot of work, I'm not gonna lie, but it was not really ever hard work. It was, it was, it was enjoyable the executive ed that I've done, you know, I love meeting with other people who were running companies and hearing about their, you know, their challenges, and learning from their experiences. You know, doing my PhD in video games really answered a lot of questions that I had, and it was kind of fundamentally, it's like, you know, why do people say they want innovative video games? But then when those innovative video games, you know, come out, they don't buy them, right? So you're in this perpetual cycle of angry, you know, angry players or groups of angry players who are just, you know, they're just not quite satisfied. So I wanted you to understand, okay, all of the industry dynamics around why we make, we make, we the industry, make the games that, that, that, that we do. But there was even a more selfish reason is that I was having a hard time getting our games pitched to publishers. And we were like, come on, this is innovative. Why don't you sign this up? And sure, like, but you, but you'll sign up this other garbage project, but you don't want ours and and I wanted to try and get behind some of the decision making that was really, that was behind closed doors to us as video game developers, trying to get into the, you know, into the decision makers rooms of the publishers or the people who had the money to do it. So I did get those answers just in time for that question to be modestly irrelevant when we started to do our own and then have our own money to sure pay for other games.

 

Eric Morse 

You know, I think people forget how much you can learn as a student that you can't actually when you're in the industry, because everybody's willing to talk to a student and help them out.

 

Michael Schmalz 

True, yeah. And you get different perspectives. There's, there's no doubt that there are people who are, you know, they've been in their jobs for years, and they can't understand the or don't even question the reasons why things are the way they are. Yeah. So it became, at times quite frustrating for us, especially when you know, we came close to the line a few times trying to get our next project signed up and trying to make our way through those, those difficult 10 years from 2004 to 2014 and yeah, there's the no friends out there. Yeah. So, yeah, going back to school and and to be able to, you know, read the the game actually was very little game research at that time, but you talk about the marketing research, the consumer psychology and all sorts of things, brand management was also one of the interesting things that I kind of dove into these brands are huge. Like, every game is a sequel, and the value of intellectual property in the video game industry is huge. So like, why is that? Why is that probably more so than than other content on television or movies? So, yeah!

 

Eric Morse 

Fantastic. So Mike, this have been fun. I have one last question, if you were, you know, thinking about our student listeners, or anybody that aspires in an entrepreneurial way, what are some of the things that we should be doing in helping them prepare for their entrepreneurial journey?

 

Michael Schmalz 

Well, you know, I think having a center like this is a really good start. I wish I would have had this, because it really does get people thinking about doing cool things. And, you know, at least when I was an undergrad, when I was young, you're just kind of laser focused on driving through your curriculum, getting your marks, and, you know, getting out didn't leave a lot of room for, you know, for lateral thinking. So I really like the, you know, the different creative facilities that you've set up here that that encourage, you know, that encourage students to to think about, you know, whether it's designing Halloween costumes for themselves or or printing, you know, models for their, you know, their their favorite movie, or whatever it is, like, like, that's, you know, that's cool.

 

Eric Morse 

And we layer that on top of trying to, you know, match them up with like minded people, where they push each other. And that's a big part of what we hope will be the magic.

 

Michael Schmalz 

Exactly, I think, you know, to get them as much experience with with the industry. I mean, I think that's, you know, the co op jobs are really important. One of the things that I've said, and I still maintain, is anyone who wants to make video games, is that you should out of university. It's like, just go get a job at a video game company, even if you're a tester or you're making the coffee, but use that time to see how those companies work, because there's a lot of, there's a lot of things that can help you along the way making your own games. If you only knew there's a lot of, I wouldn't say it's, it's, it's, it's corporate secrets, but it's just like pipelines that have been well developed well and you need to see that.

 

Eric Morse 

And your, you know, history is a great example of that. I laugh a lot with entrepreneurs that, you know, they're a 10 year overnight success, but yeah, takes you 10 years to kind of figure it out, and then things took off for you...

 

Michael Schmalz 

It's funny. For us, it was more like, it was more like 20 years and, and when it does it, it comes strangely fast and, and you, you almost stop thinking about it in terms of success. It's like, it's just, it's the battle every day, win a few, lose a few, try and get a little further ahead. But then all of a sudden, you know, we did something with Warframe that just kind of propelled us into a new league and and into an entirely new business situation. And that, that was, that was pretty awesome.

 

Eric Morse 

Very awesome. Yeah, that's probably a good place to end it. Michael, thank you so much for being here today.

 

Michael Schmalz 

Thank you, Eric, I really enjoyed it.

 

Eric Morse 

The Entrepreneur Podcast is sponsored by QuantumShift, 2008 alum, Connie Clerici and Closing the Gap Healthcare Group to ensure you never miss an episode. Subscribe to the show on your favorite podcast player or visit entrepreneurship.uwo.ca/podcast. Thank you so much for listening until next time you.