Developers Corner

Just to add to that; absolutely have the pre-production finished beforehand. I was one of those people that thought all cost estimates were bloated and calculated in the portly administrative types that really don't do much. While this is true to some extent, the costs are still significant (as is the role of those portly administrators). So yes, pre-production can cost a very pretty penny. Granted, this is highly reduced if you have a team that already owns the needed software and is willing to work for free.

However, starting from the beginning, the odds of you getting a bank loan for several million are...umm...not good. So, I'd guess that you'll have to put together a proposal and tech demo to take to a potential investor. This itself requires much of the pre-production to be finished. So, most likely, your premier game will happily avoid the costs of pre-production.

We are also looking to setup our studio in central wisconsin. Obviously not the land of opportunity (but it does have a lot of untapped resources), but the cost of living here is significantly lower than larger cities. (Around 30k/year is quite comfortable.)

You then have to determine how many developers you'll need and how much you'll pay them. Again, if the bulk of this team helped start the project, they may be willing to take a small pay cut for the first year or so to see it through. Though this does not hold true if you hire additional staff (they're there for the money), and even your dedicated team will be offended if the "new guys" are getting paid more.

Next, determine how long it will take you to completet the project (assuming you have full funding and everyone can work on it full time). This part is tricky, especially if you've never made a game before. Still, you'll eventually have to etch out some monthly milestones for the team and a basic schedule, so you'll have to tackle this obstacle sooner or later anyway.

Ok, you have 2 numbers now! How much the team is being paid and how long their being paid. Multiply this and you have the payroll estimate. Then its on to hardware and bills. Fortunately, this is something I've had to do before, so I have a pretty good idea. In a nutshell, you'll need workstations with commercial lisencing for the required software for each person on the team. You'll also need some sound recording and engineering equipment, game servers (6 is plenty for a beginning project at release time, and you won't buy all of those until you're closer to beta), internal servers (ftp, svn) for storage of code, graphics, music, etc, you'll also need some kind of server architecture on your game servers, which will be between $1500 and $3000 each. Your bills will include rent (estimate about $1/ sq ft /month) electricity (LOTS), internet, phone, security systems (important), insurance (VERY important). You may also need to do some remodeling of the building, though this is not nearly as expensive as you might think. Most likely, you'll have to redo all of the electrical work in the building, which can cost around 5k, etc.

Then there's the "contingency fund" I had mentioned. Have some money (a significant amount) set aside for unexpected issues that WILL arise. For example, machines malfunction (especially if you go non-brand)...pay for the service warranty, a window might break in the office or (and I can almost promise this) the release date gets pushed back (you still have to pay these guys).

And so, yada, yada, yada, carry the one... I don't know. Our bill came to around $5 million. Hopes this helps a bit. Let me know if you have any questions. I'll help if I can.