Hi, this is Wayne again with a topic “Case Study: Tim Darosa, Ouya”.
Hey uh, so my name’s tim and, unfortunately for me, uh, unlike everybody else, who’s spoken today, i’m the stupid marketing guy, i’m not the maker, but i’m here to talk about the story because it’s near and dear to my heart, so julie ehrman is the founder of Ouya and for those of you who have not heard of it, it’s a game, console system, the idea, kind of came about julie and i worked together in a subsidiary of ign called direct to drive. It was their digital distribution channel and, and we ran it for for a couple of years and um. I remember uh nine o’clock at night eating pizza trying to figure some some of the accounting work out. Shenanigans are looking at the books and we’re like something’s wrong. This is it’s been a year and a half digital revenues are down. You know our jobs are there to be there to be supportive of the game. Creators, right and and we’ve both been in the games industry for 10 plus years each and we just couldn’t piece it together. We we knew the trends were changing, we knew the industry was shrinking. We knew there were a lot of things up, but we didn’t have really the answer on how to solve it, so she kept coming up these stupid ideas on the whiteboard and every time, literally, every time she put up on the whiteboard.
I like get back to work. That’S stupid, like move on um. So eventually we were acquired, gamefly, acquired, direct to drive and that kind of forced us to go our own separate ways. I got a job, i have a family, i need a paycheck, um julie decided to screw that and she wanted to start something new and different.
So she calls me a year ago, literally last week and she says so i think i got it. I think i got an idea game console we’re gon na go against the big boys android open platform. I want anybody to be able to develop if they can put a usb into their computer and plug into our console. There’S one console: there’s not a dev kit that costs five thousand dollars, plus the system, plus all the tools and and everything that goes with it, and i stopped her right there and i said julie. I got a job. I moved on i’m out of games.
I’Ve grown up. Good luck! Let me know how i can help so fast forward. We’Ve been talking, i’m helping her out with some of the messaging marketing stuff, all the stuff, the stupid marketing guy does. She tells me she’s going on kickstarter the night before it’s all right.
Good luck on kickstarter, that’s kind of a cool idea. Less than a day later, two million dollars were raised, uh fastest kickstarter program in a 48-hour window um, and then she calls me up to rub it in my face right, like hey guess what this is real like people are believing in this. I need your help.
Like get behind it said okay, but you know the kickstarter funds. I know how hardware goes it: ain’t cheap you’re going to have to build this thing you just committed. You got to build it now. You got enough 60. 000 plus people said yes, okay. Well, we got new funding. It was announced this past week, 15 million dollars in from the venture capital community as well. So this thing is moving this thing’s real julie believed in it was really the only one to believe in it. Um and now we’ve got a product, and now i have a job and i’m really excited about it um so so julie is for those of you that know her or seen her on on some of her presentations. She’S got so much personality and energy, i’m not gon na do that justice, but i wanted to go through. You guys were kind enough to have me here. Thank you very much. I wanted to go through just a few of the learnings we’ve had because god knows there are a lot and and and just to set the stage.
Not one person in the core group of ouya had ever created hardware, not one person, and there were five in that core group. So we had yves bahar who came in from fuse project on the right there big head on the right there and he’s been amazing. He helped us create this thing. You know from the clay model that we kind of photoshopped and put up on kickstarter to say: hey, it’s real uh to the actual device and um he’s been amazing. He’S really carried us kind of into this. You know into the space that you don’t have to be a multi-million dollar company billion dollar company, a lot of them to be able to play here.
You just have to create something that works, something that’s simple, something that makes sense and something that actually is built and supported by the people who will do the most with it, which is the creators. So we get our funding right, we’re moving on julie. My first day on the job, officially julie’s like we’re going to do this very differently. I said: okay, well, here’s what i know about hardware – and this is what i read in books and i’ve talked to a lot of people about. You typically do all of these steps. Before you get to your announcement and launch julie, you did it ask backwards.
You promised a product, you promised some features, but you didn’t really get it polished yet, and you also said we’re gon na get it to you by xdate and i’m the marketing guy right with the communication strategy and everything that’s gon na have to say sorry is What i’m thinking at the time? So here’s the traditional approach right, you get your design, you get your cost schedule, quality features you announce and then you launch to market companies like amazon apple. I mean it’s a proven model. This is how it works in. In a lot of today’s worlds, our bass backwards approach, she had a design literally. This was sketched out with eaves and we created the clay models and had some some examples up. Then we announced it on kickstarter and when you announce it on kickstarter, you’re, technically selling the product.
Therefore you’ve launched it’s fine. If you do our goal, i think in kickstarter was 700 000 800 000 somewhere in that neighborhood, and when you back into the number of people that needed to to commit to that, we were like fine. We can produce that number right, not 65 frickin thousand units. That’S a very different monster, so we launch, then we get into the quality conversation.
Julia is very picky. Has her high bar for quality. We know we need to hit that bar and then the schedule by the way in kickstarter, we said we’re gon na. Have these things shipped to you guys by, i believe it was march oops, sorry, again, marketing communication, apologize, um and then cost right kickstarter. We have the funds a little additional funds came in, but there’s definitely a budget there that we have to play in. So we had to be smart right.
This is not rocket science. This this box right here is essentially made off of parts. You can get anywhere. There’S nothing really proprietary in this at all, and that was that took a lot of guts on julia’s part to go out there and launch a product announce a product that anyone could build on store shelves if it didn’t work on kickstarter.
Any of you could pick this up and you could today actually and build it yourself, so we got through all of this and then we got to the features piece right like the features are pretty important when it comes to a console. That’S on the back of the box of the xbox back in the box of the playstation. What are our features? Julie, uh? I don’t know we got to do like these things. That’S what i want it to that’s my dream, that’s my vision, but do we have time? Do we have the money? Do we have? So what did we do? These are what we learned our challenges and learnings all came very quickly in this project. We had our long list of everything we want nuya and that list continues to grow by the day, but we also have a schedule we had to hit, which we promised all of our early backers and now we’re promising the street we launched in retail june 25th. So we had to pare that down and the learning was just ask like we were. We were sitting in the office kind of frustrated about this list and everything we wanted, but we knew that the production lines in china weren’t going to be able to retool in time and there was going to be some complications. I got on the blog and i put out a simple blog update and said guys we’re wrestling between these 10 things. Can you help us out and within about three hours, we had 120 000 comments back to us in either email or the blog ranking. Those features for us, so we were able to then set our set our standards moving forward and if you follow us at all, through either kickstarter or on our ouya.tv blog, it’s still very open.
Usually, every day at least every week, we’ve got it back and forth with our users. The other challenge that came about very quickly is we’re the new kid on the block in a pretty big, mature industry right. So when you’re that, when you’re that person, you don’t have a lot of hardware experience, we literally at that point in time had one guy who had shipped hardware before we had to figure it out fast and the only way to do that was, to be honest, Open transparent with our community our early backers, and continue to ask the questions that aren’t always easy to ask as a company, sometimes you’re, in a position where you feel like you need to know that answer. We don’t shy away from the fact that, most of the time we don’t know the answer, um and it’s been amazing – we’ve had we’ve had we’ve had an awesome, uh, an awesome feedback, uh and and overwhelming support from the community.
That’S allowed us to kind of guide and steer the priority list for our production roadmap. Um staffing, so we did all of this julie is the one who gets all the credit julie did all of this from idea a year ago to production today to right now we’re producing about 22 000 units a week uh in china and she’s done it with Five people on the business side, like literally on the business – i was the last one added to that, but she’s done it with five people managing the business. The rest were the engineers product guys the people actually helping to build it. The hard way on the software, but if you think about that from retail partnerships to the the the financial, you know fundraising aspects to the to the hardware consultants that actually helped build this both here and overseas.
She did that in less than a year, and she literally i mean she ran this by herself for a long time. It’S it’s a pretty incredible story and someone who is truly dedicated to getting this up off the ground, and so the the big learning from the limited resources that we did get was. I never believed in virtual organizations not once and i’ve always poo-pooed them in previous lives. If you have good people – and you have people who have experience in doing these things – and you have people – you can trust the biggest piece – it’s very possible uh and and virtual virtual orgs – i’m a big believer in right. Now we’re doing it right now. We’Ve got six satellite kind of offices and those include people out of their houses, working and no office, no office single office, space houses more than four people for ouya, so we’re truly spread out all over and it’s working really well. So far, quality control was the biggest learning from from them being new in hardware. For me, personally um we kind of took our eye off the ball.
It delayed launch, which we again announced recently june 25th instead of june 4th. We had some issues with joystick or with our controller, specifically uh button sticking, and it was something that was that we obviously should have caught. We didn’t have someone on the ground over in china for the production lines from day one and it required us flying over and taking shifts to go back and forth between china and home bottom line. Have somebody there have a couple of people there if you can afford to do it, it’ll be worth it it’ll save you time, it’ll save you money and i think you know once you get all of these things right and you have the way julie likes to Put it is if this were just her, we would fail right the way that we were able to get the guys in china to correct some of these quality control issues where we put our development community directly in touch with our production lines, and so it was Pretty cool we had developers so right now we have 12 000 registered developers signed up and supporting ouya.
That’S pretty incredible too, just in that number, but we had 35 of them actually were vocal direct with our production lines. Doing joystick testing controller testing dialog stick testing. It honestly this is this is something that probably sounds cheesy and it’s definitely not meant to be, but when you, when you have an idea, not many people believe you put it up on kickstarter, you get a community built that quickly of both developers and consumers, and Then you get production lines that can go wrong in a million different ways and you get all that back on track because the the community, the ones who believed in you in the first place, stepped in to help. It’S been a cycle that we’re seeing over and over now with ooyah, and it’s one that i’m now a full believer in um, so we’re out there. If you haven’t gotten your early backer unit, i can guarantee you’re going to get it very shortly.
We’Re going to have all early backer units out by the end of the month, which i’m really proud to say that was our initial goal from the onset, so we will hit that and for retailers. The good news for us that just got confirmed last week is we’re going to have 600 stores worldwide. Carry this thing on day, one which you know i came from midway working on mortal kombat and spent some time in the ea, and you don’t get that kind of support without having really even sold one unit on a store shelf before so so far. So far, we’re good i’m sorry! Oh we’re done i’m getting, though thank you. .