What about his facility rent, utilities, payroll taxes, insurance etc...
I rent a a flex space with offices and a small warehouse outside DC and rent is nearly $6k a month. Assume best case scenario his rent is $3k, that's $36k a year. How long has he been in his new place? 3 years? That's over $100k in rent alone.

Here's a place a few doors down from his place, $89k to buy
http://www.loopnet.com/Listing/18692404/33-Sangra-Court-Streamwood-IL/

Here's another one not far away, $1.16/sq ft monthly rental ($1600 for 1400 square feet, looks very similiar to JPOP's place)
http://www.loopnet.com/Listing/18997593/51-Sangra-Court-Streamwood-IL/

My guess is he pays himself around 100k-125k per year in his personal salary...that is a half million over 4-5 years in and of itself. Of course, perhaps he is paying himself less...we don't know.

But if less, how much less? He needs to live...he has to be paying himself something and he is in charge of his own salary setting presumably.

Guessing and Theorizing and $1.5 buys you a coca cola...

I understand where you're coming from but I would say complete segregation of funds isn't possible. Jpop's spent a lot of time and money developing the system, boards, cab, common parts from scratch for all his games that has to be supported by funds his first few games.

The problem is how much time and money he overspends on developing MG way past what he originally planned.

No doubt. The underlying issue is no one knows, absent information speculation will continue to run rampant. Ice will solve the information gaps, I am confident.

$89,000 for a commercial property? Jeeeeeeeeeeeeeeeeeeeeeeeeeeez thats cheap!

Why would you pay $1600 a month (19,2000 a year) to rent when you can buy for $89k?

In NZ that place would cost 4x that price.

Mind you, supply and demand I guess. When I was driving across the USA last May, there sure were a lot of empty buildings everywhere.

rd

How did you arrive with these specific numbers?

Wow. Commercial property is way cheap there. I assumed as suburb or Chicago would be on par with a suburb of DC. Guess not. Maybe I should invest in commercial property in streamwood. I stand corrected.

Just made up the numbers, worked backwards.

I am assuming he is not getting people to work for free or free rent, free utilities, free 3D printers etc..

I assumed John has collected ~$1,300,000 plus or minus. I figured he has to have spent less than $1.3M. So I just worked bacwards from there. Made up the costs, but working form what his bankroll is assuming he is not using any of his own money (I have no idea if is is or isn't).

I figure he has to have some money lying around so I'm figuring he has ~$300k left over. He has money due when he starts to build which I am counting for BOM and assembly and holdback for warranty.

Here's what I figure he has collected (plus or minus). I'm figuring most people have not paid in full.
30 MG x $14000 ($420k)
124 RAZA x $6500 ($806k)
100 AIW x $2000 ($200k)

Sum $1.42M

So I'm figuring he needs to have spent less than $1.42M

He has to pay for art, music, lawyers, code, web site, rent, utilities, patents, equipment such as computers, routers, 3D printers, materials and supplies, if he has any employees he should have to pay benifits as well as employee portions of SS and Medicare taxes.

John does seem like a very frugal guy and maybe running on a shoestring budget, but over 3-4 years he has to have spent down a lot of the $1.3M which is not really a lot of money if you think of the time factor as time = money.

Aren't most people only paid up like halfway? Depending, I bet the other half could easily cover production.

There are officially 19 MGs paid in full at $15,995.

For RAZA John has collected like 60-70% because he was collecting money on his accelerated timeline not his actual timeline.

If we leave off AIW a since I don't know what people have given for that title, he'd have somewhat over $1M collected which is not a lot to last between a third and a half a decade of development.

I know Skit-B and Wooly have done it for much less, but John seems to be more high end as well as using more proprietary components as opposed to an off the shelf Computer controller like P-Roc.

From what I've seen of John's work it's very high quality and not cost cutting in any evident way.

I can't speak for the current state of his business, but I know many people including myself that have volunteered for the sake of helping the cause. Others have been offered other monetary things that shall go unnamed. Zidware isn't your typical business like a Stern, it's a startup.

Good point. I'm hopeful for the absolute best. And that all the forthcoming reveals and soon shipment of MG games will reverse any current pessimism.

Sounds like the core issue is his inability to focus on a single game. If I was a MG owner I'd be questioning why he is planning on showing a fully built Zombieland while he has yet to do so for MG.

Promote the second before the first is out the door.

Sounds like standard business practice for a pinball startup.

For that much money, I think a lot of us would start making pinball games.

Or claim to be making them!

Well at least one person should hear from John soon!

I bet John is taking a very small salary. There just isn't enough money in the pool to to towards a substantial salary. His payout is ownership of the company.

Most people starting a company will sacrifice their own capital and not take salary or take minimal salary to get their company off the ground.

Rule #1, pay yourself first.

reality lesson #1, to stay in business you pay yourself last.

If you can't pay #1 you're running a charity.

Correction. If you can't afford to pay yourself, you can't afford to be in business.

I learned that lesson the hard way.

Ask the sba why most small businesses fail. The overwhelming answer is being undercapitalized. A close second is underestimating the cost to produce a good or commodity.

I wish John's methods would prove him right and prove us wrong, but it seems like our concerns are justified.

We know and EXPECTED the actual pinballs were going to be spectacular, that is why we put our money at risk years ago. So the fact that he's got something at his shop that dazzles is not a surprise.

Where things go off kilter is we don't know, and still don't, whether he has the ability to get finished machines into our hands. Everything rests with MG, being a small production run it would seem like an easy way to demonstrate that he can get it done, but the longer it goes on the more concern I have for everything.

I think it's very likely at this point, that come expo 2015 in october, no one will have seen a machine outside of the prototypes at his shop, and even those will have had limited public visibility (controlled website/video). And we're going to be here wondering if he's going to bring MG to expo, whether that will be the "lebowski" reveal. And we'll still be wondering when customers will get theirs.

And if it takes that long for MG... where does that leave raza and the time it will take to produce 6x the machines?

I think in a lot of ways John is, whatever money he takes is probably slave wages compared to the hours he works.

That probably makes the criticism he gets sting that much more.

But this is a problem of his own doing. These games don't need to "bake" for years extra. If things were run like a real business, stick to the deadline and push the product out, and make your next game that much better. It doesn't mean the product you put out his horeshit, it just means you have to draw the line somewhere.

And he'd have tons of happy customers begging to get in on the next game, as opposed to now where many of the customers refuse to send one more dollar.

This is nonsense, people all through time work to build a buisness and don't take money as pay, they sometimes put in their own money to start a company.

One example is when Bill Gates and Paul Allen were starting Microsoft, they worked on the code for BASIC to run on Altair computer, they didn't pay themselves to work on that, in fact they didn't even have a contract, they sold the finished product, if they had not sold the product they would have worked for free, but that's not a charity. Look up what a charity is if you're unclear. john is not running a charity.

The difference between zidware and some other startups is the profit has already been realized. All the games are sold and almost all paid for with no standards or other model to generate more profit from.

I'd be in favor of not posting any more on this thread for a while. It's all speculation, maybe Ice will have some concrete facts in a while.

I've spoken with John, he says the machines look fantastic or are comming along great. Whatever that means I don't know but I'd give him some slack until he fails to meet another deadline or some hard facts come to light.

He can *say* whatever he wants. If he *showed* something that might be different.

This is the biggest problem with his model as well as the Nemo pin to be fair, that was sold out before it was produced.

I think there needs to be a reward if the game is good which would mean more sales down the road, let's say Stern makes AcDc and it is a great success and they can sell 6,000 units or more. If Stern had built 100 units only no more, they would have capped their upside greatly.

Also people can say the carry forward to future Zidware games, he can sell more of the later games but as we know from Stern or B/W or any company some games are better than others. What if his first game is super like MM but the second game is not as good like Gilligans Island. He's still capped out of selling his great game not meaning it will lead to big sales of other games. IMO the preferred method should be make the games first and sell as many as people want or can afford this rewards you for making great games, his current model rewards him for making any game good or bad it's no difference.

John is limiting the total inflow to under $2M for two machines which may end up just at a break even point or who knows could end up costing him money if he underestimated the time and complexity.

Maybe he's pulling in big bucks selling apps.

https://itunes.apple.com/us/app/pinball-wizard!/id342524463?mt=8

image.jpg

The ACDC is a good example. Stern's development costs are the same for ACDC as they were for Mustang, around a million.

But they sold ~1000 Mustangs and ~6000 ACDCs... besides BOM, that is pure profit on 5000 machines.

THAT is a real business model. Not to mention the profit from ACDC carries them over the hump of titles like Mustang.

They sold 1000 Mustangs?

Would you prefer he opened up sales on the machines? Selling 50 or 100 MGs would certainly close any conceivable gap, plus more people would get to enjoy the game. Obviously, he would have to make sure the ones who preordered from the start get a good bit of extra bells and whistles on their machines, since they would then be a (little) bit less "exclusive"...

From the rumors, that is what is coming. If that saves the business, it is hard to argue against.

I guess my main point is the entire business model is flawed, and it infuriates me and others when John is not more forthcoming about it, in light of the fact that he's had our money all this time. We're able to see the writing on the wall, have been asking tough questions and we get stonewalled.

"Lesson learned" for me, since I won't be pre-ordering again.

I don't think it is reasonable for people to expect on the one hand JPop is working 60 hour weeks just on this project for the past 4-5 years but hasn't been taking money out of it to live in. We all have to live...maybe JPop is independently wealthy and doesn't need any money to live on...

If he spends all his time at the studio and eats a bag lunch, he probably lives on 1/4 of what the rest of us spend.

I know I have no money on this, and people paid seriously big bucks for an "exclusive" game, but even so, I think ultra limited games are lame.

If they're really that awesome then it sucks that almost no one will ever get to see or play them. And just from a business standpoint it makes no sense. 100 games? Okay you can get some economy of scale there. That's why WOOLY was aiming for that. But 15, or 20, (or what is it now? 40?) it's just silly, they're all more expensive to make that way.

But I have no skin in the game, and I can understand people who paid all that money and waited all this time being upset at increasing the run.

I didn't realize I could cut my living expenses by 75% by just bringing a bagged lunch every day!

You're assuming John could find 50-100 more people willing to spend sixteen grand on MG. Honestly, I think just about everyone who would do that, has already done that. 16K buys a lot of quality pinball... would you rather have, say, an EBD (2K), Spirit (5K), an AFM (6K) and a few good EMs? Or a Magic Girl? None of John's earlier games were exactly earth-shattering, so I don't understand this second-coming-of-Christ mentality around MG and RAZA....

Lame how?

Face it, the only way that people were going to pay this kind of money up front was based on the promise of exclusiveness/rarity of a JPop designed pin. It's a risk/reward calculation. The risk is high (that's even more obvious now) but so is the potential reward. MG is going to be much more rare than RAZA, thus the higher price. The addition of more MG's to the run would piss me off if I was a buyer. I would hope that JPop got the other owners consent to do this, or offered them a refund.

Because it flies in the face of the crowd who have the mantra that pinball isn't an investment.

I do wonder what the market is for $16k pins. I don't think there will be an automatic land rush by 30 additional people. Especially if they need to pay now, and wait for the machines to be built yet (and who knows when that will be).

Lame in that all that work just to make a bare handful of games that will be squirreled away in private collections just doesn't fit my personal spirit of pinball. But also just is poor business sense.

Obviously at least some people were seeing at something that might be worth a lot more later. And fine. And if it was promised to be limited when you paid then it should stay that way.

The horror!

The "pinball for all" mantra doesn't work for everyone. JPop isn't Stern...and doesn't want to be.

50 has never been confirmed
And
He hasn't taken any money past the 19 games

The plan is make the 19 in one run.