(Topic ID: 203700)

deeproot Pinball thread

By pin2d

6 years ago


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#17951 2 years ago
Quoted from SantaEatsCheese:

While this thread is active again, I'd liek to remind everyone of the math on this is the $30,000,000 investment to start up rumour is true. At $1,000 profit per machine and a 6% return on investment to investors they will literally never make any money even at 50 machines per week.

What's their stupid slogan..."Every home needs a pinball"? How many homes on Earth are there...billions!? Robert will have the last laugh!

#17952 2 years ago
Quoted from Mr68:

Yeah, Jpop left a bad taste but I don't think they want to deal with Robert either.

Quite honestly, if I had to choose, I would rather deal with Jpop than Robert, so I agree with your statement 100%

#17953 2 years ago

Real hard data - Machines produced other than proto type - Zero

Money Spent - Lots $

#17954 2 years ago
Quoted from Yelobird:

Won't debate but I think your statement answers itself. Your basing all assumptions and data on what you know were made up PT Barnum type statements? lol If he said he could build the games for 5$ would you believe that data point? It doesn't matter what he says only what he Does.

Here's the thing... DR doesn't live in an alternate universe, they live within the realities of this one. You don't need to know the actual margin, capital, or volume numbers to have estimates that are within reason.. especially when the guy gave you estimates for 2 of the three numbers!. And like the earlier example did, you can even lean your estimates towards optimistic and run the math again.

You don't need precision to know $1,000,000 is way bigger than $100.

#17956 2 years ago
Quoted from flynnibus:

All this was said back when Robert was boasting about his burn rate and how much they were spending. It was just impossible to ever make money at the kind of scale any reasonable pinball manufacturer would be running at. And that was back when there were hopes they were actually going to address new markets. We've seen how that's gone.
It's been DOA for anyone with the slightest bit of business sense for years. There was never going to be a profit from their activities alone.

This is the precise reason I would only look at this adventure as a way to create a huge tax write off for whatever else this guy is flogging!

#17957 2 years ago
Quoted from flynnibus:

You don't need to know the actual margin, capital, or volume numbers to have estimates that are within reason..

Especially when the estimate is an assumed guess of no value! Everyone has spoken and in most cases rightfully that they don't believe ANYTHING that Robert has pitched Except the numbers. Those for some reason everyone feels he was spot on honest.... lol He won't show his facility or even the lobby yet you Think he is accurately showing you his business finances???

#17958 2 years ago
Quoted from Yelobird:Especially when the estimate is an assumed guess of no value! Everyone has spoken and in most cases rightfully that they don't believe ANYTHING that Robert has pitched Except the numbers. Those for some reason everyone feels he was spot on honest.... lol He won't show his facility or even the lobby yet you Think he is accurately showing you his business finances???

It's called keeping the frame of reference.

He can bloat his claims all he wants - we just run the numbers according to his own math.. and again show his model is unsustainable.

Or you can ignore his numbers, and make up estimates based on known information (time, estimates on employees, estimates on typical overhead costs), expected sales volumes, industry conventions, etc.

You act like people are dreaming this stuff up - it's literally what analysts and people writing business plans do every day.

#17959 2 years ago
Quoted from flynnibus:

It's called keeping the frame of reference.
He can bloat his claims all he wants - we just run the numbers according to his own math.. and again show his model is unsustainable.
Or you can ignore his numbers, and make up estimates based on known information (time, estimates on employees, estimates on typical overhead costs), expected sales volumes, industry conventions, etc.
You act like people are dreaming this stuff up - it's literally what analysts and people writing business plans do every day.

You win, your amazing, you must be right!

#17960 2 years ago

The analysis forgets to account for the company intrinsic value after decades of postulated positive cash flow. The ROI does not have to be in interest or dividends, it could be in capital gain. Anyway, the math probably still does not add up.

#17961 2 years ago

Deeproot reminds me of a software company I used to work for out of college, where the CEO was essentially a trust fund kid. His decision making process involved yelling deadlines and throwing huge amounts of money at people, and then sitting on his hands doing nothing when any actual leadership or hard work was needed. I assume he was so accustomed to money trivially solving problems in his personal life, that he was completely out of touch with reality when faced with a problem that cash alone wouldn't solve. It sometimes bordered on magical thinking, which was frustrating as a new engineer who was trying to live in the real world.

I was only there for about 9 months before I found a better opportunity, but it really soured me to this specific type of individual.

#17962 2 years ago

You don't even need math. They sold 160 games! 160!!! (and that might be inflated)!

#17963 2 years ago
Quoted from wcbrandes:

This is the precise reason I would only look at this adventure as a way to create a huge tax write off for whatever else this guy is flogging!

I suspect this is the exact reason Pinball Adventures exists.

#17964 2 years ago
Quoted from clempo:

The analysis forgets to account for the company intrinsic value after decades of postulated positive cash flow. The ROI does not have to be in interest or dividends, it could be in capital gain. Anyway, the math probably still does not add up.

'decades of postulated positive cash flow'..... in the era of countless other userbase driven software platforms investors could be getting returns on in <5 years?

Heck... where is a pinball company on the planet today with 'decades of postulated positive cash flow' ? You're talking completely academic without any connection to the case at hand.

Their burnrate alone (as advertised) nuked any notion of positive cash flow. If you're spending a million a month, and selling $10k games.. even if you had 100% profit margin they'd have to sell 100 games a month. But Robert was teasing selling at like $6k (or less).. and even if you claimed 75% gross margin (which is... by all accounts, unreasonable) that is 222 games a month. That's why we don't need the 'real' numbers... the 'pie in the sky' numbers don't even work.

I still think Robert thought like JPop did for zidware... they'd make up some wild "must have" ideas and someone would buy them out or license their ideas.

#17965 2 years ago
Quoted from spfxted:

You don't even need math. They sold 160 games! 160!!! (and that might be inflated)!

I get your point Ted but they actually sold about 100 units and grandfathered in about 25-30 Zidware people for a total of 130. Deeproot said they would take that number to 160 games to sell as extras but later abandoned that idea. So 130 is the final word from Deeproot if we're to believe them.

My Zidware guess is just me rounding numbers for illustration. Deeproot never said.

#17966 2 years ago
Quoted from Yelobird:

You win, your amazing, you must be right!

This is why doing a real estimate beyond the napkin math is not worth anyone's time.

You could have a professor roll in and give a whole lecture on it, and you'd still come back with "well, lets just wait and see" or non-sense like "I only count the days from when they took orders".

You are dug in and will have nothing to do with anything that doesn't support the notion of "well it might work..."

#17967 2 years ago
Quoted from wcbrandes:

This is the precise reason I would only look at this adventure as a way to create a huge tax write off for whatever else this guy is flogging!

Who knows what their intentions are but I do taxes for a living and I do not understand this line of thinking of spending money to save on taxes. It doesn't make sense. Cash is king. Why would you burn $100 to save $10 in taxes? You are still out $90. The biggest headache I get at work is clients wanting to spend more money to get deductions to save money on taxes....I would rather keep cash in my pocket and pay tax than spend the cash to save money on tax. You have less money in your pocket in the end doing the latter.

#17968 2 years ago
Quoted from HookedonPinonics:

Who knows what their intentions are but I do taxes for a living and I do not understand this line of thinking of spending money to save on taxes. It doesn't make sense. Cash is king. Why would you burn $100 to save $10 in taxes? You are still out $90. The biggest headache I get at work is clients wanting to spend more money to get deductions to save money on taxes....I would rather keep cash in my pocket and pay tax than spend the cash to save money on tax. You have less money in your pocket in the end doing the latter.

What about in cases where they are using section 179 to offset taxes by buying assets to further multiply profit? In years past/present I would generate 40% of sales just in the last month of year end for just that reason. Never made sense to me as they Could have made the purchase early in the year and offset the profits throughout that fiscal year?

#17969 2 years ago

Yelobird I think you are looking for the Owners thread?

Edit: sorry I meant "Owners"

#17970 2 years ago
Quoted from pinlink:

Yelobird I think you are looking for the Owners thread?
Edit: sorry I meant "Owners"

Is one only allowed in your secret world only if they share like hate and negative thoughts? Sorry missed the club rules page my bad lol.

#17971 2 years ago
Quoted from Yelobird:

hate and negative thoughts?

Do you mean "reality"?

#17972 2 years ago
Quoted from pinlink:

Do you mean "reality"?

Sorry no haven't seen any of that. Hate, assumption, spite, anger, speculation, to name a few but little factual reality. It's all good, pinball should be fun. Thats what I get out of it and all I search for.

#17973 2 years ago
Quoted from Yelobird:

Is one only allowed in your secret world only if they share like hate and negative thoughts? Sorry missed the club rules page my bad lol.

I like you being around. It breaks up the echo chamber.

Some people are overly harsh instead of simply skeptical. They need to be called out on occasion.

#17974 2 years ago
Quoted from flynnibus:

'decades of postulated positive cash flow'..... in the era of countless other userbase driven software platforms investors could be getting returns on in <5 years?
Heck... where is a pinball company on the planet today with 'decades of postulated positive cash flow' ? You're talking completely academic without any connection to the case at hand.

Hey, it's not my assumption. The analysis had to postulate that long just to pay back the investors.

#17975 2 years ago

Havent been following this group for awhile. I assume my instincts were correct when I thought that they would deliver games when Satan starts skating to work.

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#17976 2 years ago
Quoted from Yelobird:

Sorry no haven't seen any of that. Hate, assumption, spite, anger, speculation

These words don't mean what you think they mean. Negative views of DR, Robert and Jpop aren't just some random partisan stance. There is a true story filled with facts that have led us to this point, and to dismiss it using these simplistic terms is nothing but gaslighting & doesn't add anything to the discussion besides showing your cultish allegiance.

#17977 2 years ago
Quoted from Rarehero:

These words don't mean what you think they mean. Negative views of DR, Robert and Jpop aren't just some random partisan stance. There is a true story filled with facts that have led us to this point, and to dismiss it using these simplistic terms is nothing but gaslighting & doesn't add anything to the discussion besides showing your cultish allegiance.

Cultish lol. Its Pinball for god's sake try not to overthink it. We are talking about an adult non essential toy. You will note I have NOT said you nor anyone can not have your personal feelings good or bad towards Jpop or RM. Thats your choice and personally could care less. IF this was the dating game and we were somehow marrying one of these guys then sure but I personally don't feel I need to be BFF's or even like either of them to enjoy the hobby. Why does this have to be so personal with those that don't agree with you? Did I (we) take your money or spite you in some way? Or is it just that we don't take your side in this fanciful fight?

#17978 2 years ago

Everybody bickering over numbers is forgetting to account for income from the TV and movie deals, IP licensing arrangements, virtual and augmented reality, tabletop games, stuffed animals, etc

#17979 2 years ago
Quoted from blueberryjohnson:

Everybody bickering over numbers is forgetting to account for income from the TV and movie deals, IP licensing arrangements, virtual and augmented reality, tabletop games, stuffed animals, etc

They’d make a killing if they sold plushies of JPop to use as voodoo dolls.

Put some Velcro in his hand and sell toys of Starbucks cups and bags of other peoples money

13
#17980 2 years ago
Quoted from Yelobird:

Why does this have to be so personal with those that don't agree with you?

Jpop made it personal by stealing money from my friends.
Robert made it personal by hiring Jpop & then insulting everyone in the pinball biz like he knows how to do anything.

It's not about "agreeing". Again, you're approaching this like a political argument.

You like to take swipes at people like me for being full of hate and whatnot...one person from the pre-order thread sent me strange cryptic threats like a Batman villain....another threatened my child publicly on the forum. I don't even engage with these people, but I give them downvotes and they go full EVIL on me. This is why I classify Deer Poop is a dangerous cult. No matter what facts are out there about what horrible people they are and how unlikely it is they'll ever make anything - they have sycophants like you who try to gaslight and flip it on us...like we've done something wrong...and even worse, sycophants who intend to cause harm. THAT'S personal....and I didn't start it.

#17981 2 years ago
Quoted from Yelobird:

Cultish lol. Its Pinball for god's sake try not to overthink it. We are talking about an adult non essential toy. You will note I have NOT said you nor anyone can not have your personal feelings good or bad towards Jpop or RM. Thats your choice and personally could care less. IF this was the dating game and we were somehow marrying one of these guys then sure but I personally don't feel I need to be BFF's or even like either of them to enjoy the hobby. Why does this have to be so personal with those that don't agree with you? Did I (we) take your money or spite you in some way? Or is it just that we don't take your side in this fanciful fight?

Much of that is true, but it's more than a toy to the people working in the industry. It's their livelihoods. So whether or not deeproot can succeed matters to their employees (poor folks!).

Quoted from SantaEatsCheese:

While this thread is active again, I'd liek to remind everyone of the math on this is the $30,000,000 investment to start up rumour is true. At $1,000 profit per machine and a 6% return on investment to investors they will literally never make any money even at 50 machines per week.
From several months ago:
f they make 50 machines per week (JJP numbers), and make $2000 per machine, if they are paying 6% to their initial investors it would take them almost 20 years to break even.
Let's say Deeproot is invested in this all at $30,000,000. How much "profit" do they need to make on a machine? Let's say for the purpose of math (and making it easier to alter later) it is $1,000. That means that in order for Deeproot to break even, they would need to make ($30,000,000/$1,000) 30,000 machines just to break even. Let's step that up further and say that they reach the rumored manufacturing capacity of Jersey Jack Pinball of 50 machines per week. This would imply that (30,000/50) 600 weeks or 11.5 years were needed just to break even. If you want to say they make $2,000 per machine that makes 5.75 years or $3,000 per machine makes almost 4 years just to break even. But wait! Deeproot must be paying their investors some sort of rate of return. 11.5 years at $1,000 per machine and Deeproot promised... say a 6% return on investment once production started, then they would owe investors almost $60 million after 11.5 years, not $30 million. In fact, if you include interest of 6% on Deeptroot initial startup money at $30,000,000, produce at the rate of Jersey Jack (50 per week), Deeproot would never be able to eliminate its startup debt. At $2,000 markup per machine it would take them ALMOST 20 YEARS to eliminate startup debt.
Please note I have no insider knowledge of Deeproot and am pulling the numbers for debt repayment based off of online calculators. My math may or may not be right but from my purely mathematical analysis I do not see this company making it long term. With that said I am rooting for them.

Quoted from Yelobird:

How is it defined as "mathematical analysis" when the value, profit margin, percentage return, capacity, (basically All numbers) are assumed or made up? Wouldn't it be more defined as a "mathematical guess"? Just because we add paragraphs of numbers doesn't make the equation in any way valid. lol

I think you're missing the point yelobird. I believe sataneatscheese's is trying to say that even by doing basic math, being generous with profit margins, and being very liberal with manufacturing and sales estimates, there doesn't seem to be any feasible way for deeproot to crawl out of their seemingly enormous debt and become a profitable company.

Debt kills otherwise profitable businesses. Take Toys R Us for example, they were actually still making money when they shutdown. Absent debt, they were earning far more than their operating expenses. The problem is, they just weren't able to make enough money to overcome the massive debt they incurred when the investors bought them in a leveraged buyout. So while yes, their profits were down from their peak, it was the wallstreet money guys that killed TRU.

12
#17982 2 years ago

I bet haggis sells more fathoms then deep root did razas...

#17983 2 years ago
Quoted from Rarehero:

another threatened my child publicly on the forum.

Please show where this happened. I saw the post in question and all they did was call *you* out for posting like an ass with your kid as an avatar (at which point you changed to your anti-deeproot cult pic)

#17984 2 years ago
Quoted from blueberryjohnson:

Everybody bickering over numbers is forgetting to account for income from the TV and movie deals...

Netflix just needs to make it similar to "Tiger King". Instant watch for me.

#17985 2 years ago

Just wanted to say "hi" to Big Shot Bob in case he's perusing this thread in his ample downtime.

#17986 2 years ago
Quoted from Yelobird:

What about in cases where they are using section 179 to offset taxes by buying assets to further multiply profit? In years past/present I would generate 40% of sales just in the last month of year end for just that reason. Never made sense to me as they Could have made the purchase early in the year and offset the profits throughout that fiscal year?

Section 179 is different in that you are essentially investing in your business and getting the benefit of decreasing taxable income now rather than spreading out the benefit. Sec 179 is limited to you taxable income. You cant go into a loss with section 179. It gets carried over to future years to use up. That type of deduction is different than just throwing cash at every expense you can think of to lower your taxable income.

#17987 2 years ago
Quoted from metallik:

Please show where this happened. I saw the post in question and all they did was call *you* out for posting like an ass with your kid as an avatar (at which point you changed to your anti-deeproot cult pic)

Mods removed it. Threat was implied & they agreed. Don't gaslight & defend vile people who threaten children.

#17988 2 years ago

DR should just reach out to Pinball Arcade or Zen and have their games made digitally. A million downloads worldwide across all gaming platforms. At $4 a pop.....not a bad chunck of change.

#17989 2 years ago
Quoted from SLAMT1LT:

DR should just reach out to Pinball Arcade or Zen and have their games made digitally. A million downloads worldwide across all gaming platforms. At $4 a pop.....not a bad chunck of change.

Yeah, but RAZA would only gross $640!

#17990 2 years ago
Quoted from flynnibus:

This is why doing a real estimate beyond the napkin math is not worth anyone's time.
You could have a professor roll in and give a whole lecture on it, and you'd still come back with "well, lets just wait and see" or non-sense like "I only count the days from when they took orders".
You are dug in and will have nothing to do with anything that doesn't support the notion of "well it might work..."

The funny part of all of this back and forth about financials is if DR actually produces games. How the hell did they do it?

And then what if they produce some more.

We will need to go back to the bar, scratch our azz, suck down a cold one and sharpen are pens on that napkin. Cuz the math don’t work.

I will laugh my azz off if games get produced. That will make everybody flip upside down.

This will get interesting next month on the reveal - or next steps in the saga.

#17991 2 years ago
Quoted from cpr9999:

The funny part of all of this back and forth about financials is if DR actually produces games. How the hell did they do it?
And then what if they produce some more.
We will need to go back to the bar, scratch our azz, suck down a cold one and sharpen are pens on that napkin. Cuz the math don’t work.
I will laugh my azz off if games get produced. That will make everybody flip upside down.
This will get interesting next month on the reveal - or next steps in the saga.

If they produce games and they prove well built I will tip my hat to them on a job well done. It will be the best pull out of a nose dive I am likely to ever witness. They will earn my respect. That said I wouldn’t touch that bet in Vegas with a 10 foot pole. I doubt most people would if real money (as in I actually care if I lose it) were on the line.

-1
#17992 2 years ago
Quoted from pookycade:

You can pay people to help you put this together, but the contract manufacturer is usually just looking to build and they want all their affairs in order first

Like most businesses - they would love to sell you value added services. That includes things like engineering, QA process design, supply chain management, etc. They will work with you to streamline your parts choices, redesign boards to improve cost efficiencies, etc. Real manufacturing partners are exactly that - partners. The manufacturer WANTS this, not just because it's services they can sell, but because it improves their own workflows when using common suppliers, inventory management, document control, etc across different contracts. It lowers the unit cost to the customer, while improving their speed, and collecting fees for professional services or outsourcing (like parts management). We're not looking at mail order PCB fab shops, etc here.. this is far more involved.

Of course you need a good starting point to know your own product and be able to produce the specs and needs so when you do engage, you can actually go through that process translation with the partner without starting over.

That's ultimately what seemed to torpedo DP/ARA - ARA did a lot of that work converting the DP prototypes to the ARA build and DP seemed to have a different take on responsibility for all that.

I don't know of anything on the table that would prevent DR from going this path... except for maybe Ego.

#17993 2 years ago
Quoted from wcbrandes:

This is the precise reason I would only look at this adventure as a way to create a huge tax write off for whatever else this guy is flogging!

I think the phrase "ponzi scheme " has been said in this thread before and that is also a possibility

#17994 2 years ago
Quoted from Stuieb84:

I think the phrase "ponzi scheme " has been said in this thread before and that is also a possibility

Not a ponzi scheme. That requires early investors to get paid using money from new investors, and seeing those payments gives new investors CONfidence to buy in.

Not only are sales pathetic but this is the worst time in modern history to be a new manufacturer. Unless they have a sure-fire sales hit lined up and ready to go after RAZA, it just isn't worth it.

#17995 2 years ago
Quoted from Yelobird:

It doesn't matter what he says only what he Does.

Indeed.

So, what has he done?

#17996 2 years ago
Quoted from benheck:

Unless they have a sure-fire sales hit lined up and ready to go after RAZA, it just isn't worth it.

zFatdrunk 5 (resized).pngzFatdrunk 5 (resized).png
#17997 2 years ago

It has got to be tough for DR watching what is going on over in the Hagis thread. 5 people and a whole lot less millions has excited pinside in 1 week more than DR did in many years. Reminds me of the Spinal Tap quote “There is such a fine line between clever and stupid”.

#17998 2 years ago

Where's the PinBar?

18
#17999 2 years ago
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