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Intro
This story is the result of my research on a guy who became a millionaire from servicing the players of a certain computer game. I first found out about this guy, let’s call him Jim, from another forum I am a member of. He is always driving a new Bentley or Rolls Royce or Lamborghini and he lives in a 20,000 sq foot mansion complete with multiple pools, a basketball court, theatre etc. I quickly became obsessed with finding out what Jim did for a living. Jim is a very private person and like many other millionaires he does not want anyone to know what he does. Knowing that he would never tell me what he does himself, I set out on a quest to find out how he became so wealthy.
Disclaimer 1: All this information is available online so I didn’t stalk him or anything like that. I used Google. Nothing too creepy!
Disclaimer 2: I edited the images and the story to keep his identity a secret. However, some of the members of this forum, including MJ, may know who I am talking about (though you probably don’t know the story of how he got there). To these members I ask you to please do not mention his name in this thread if you already know who he is. I respect this guy very much and have learned a lot from him and I don’t want to cause him any headaches.
Mods: If this post violates any rules please feel free to delete it.
Let’s start out with some pictures…
(This image is intentionally small)
Now that I have your attention, here’s the story.
It Starts With a Need
Back in the late 90s, Jim was in the Air Force stationed in some Oil Rich Middle-eastern country. He would often see the Arab businessmen driving around in exotic cars and he knew that he would one day drive one of these cars if only he could find the right business opportunity. Upon returning to the US, he found his million dollar idea. Around the year 2000, people were starting to play online computer games and he saw that some people were selling the items they acquired in the game to other players who paid real money for them. A player who had to work long hours or had other real-life commitments, had a hard time keeping up with players who could sit in front of a computer all day. After a long day of work, this player would go to eBay and pay a few dollars for a sword or a shield that would make his in game character more powerful. This allowed him to enjoy the fun aspects of the video game without having to spend a lot of time in the game looking for these items for himself. The ecosystem was working pretty well for a long time. Sellers were happy because they could make some extra cash and buyers were happy because they could enjoy the game without investing so much time in it. This is where Jim comes in. He knew there was a need for the service that these sellers on eBay were providing. Some of these virtual items were selling for hundreds of dollars. The problem was that these small-time item sellers on eBay were not finding items fast enough so there was a huge demand but low supply.
Achieving Scale and Freeing Up Time
In order to meet this huge demand, Jim had to find a way to generate these items quickly and in large quantities. A dedicated player could maybe find $30 or $40 worth of virtual items in a given day. This meant that employing an army of item finders and paying them minimum wage was not a scalable solution. However, Jim learned about “bot” programs that were being developed that could play the game for you while you were away. It dawned on him that he could build an army of computers that would play the game 24/7 and find these items for him. Like MJ says, computers don’t complain and you certainly don’t need to pay them a wage so it was the perfect solution. The computer would find these items and Jim could list them on eBay. Now this is the part of the story that gets hazy because I do not have the details of how his system worked. There was obviously a lot of technical knowledge required to set up this computer “bot” system and I do not know if he did this himself or hired some developers. What I do know is that within one year he was one of the top two companies doing this (Yes, competitors did enter the market but more on that later). He eventually got his system down to where he didn’t even have to list the items on eBay himself. The computer did almost everything for him. Customer service is still handled by human beings. His company states on their website that they employ 30 customer service people that work remotely from all around the world.
Losing Control and Regaining It
Everything was going great for a long time but the experienced fastlaners reading this can already see two problems with his business model. Problem 1 is that he does not have control over the game itself. The video game publisher does not like the fact that these computer armies are playing their game because it negatively affects the game economy. Real players hate these bots because they flood the in-game market with cheap items that would otherwise be very valuable. Also, some players and game developers believe these third party item sellers create unfairness because wealthy players can simply buy their way through the game which goes against the spirit of escapism and fun. As a result, the game publisher banned a lot of the fake computer accounts and this cost Jim money because he had to buy new copies of the game. As time went on however the game technology became too outdated to prevent this kind of activity and this worked to Jims favor (More on this in the Luck section below).
edit: I should clarify that the technology of the game became outdated relative to the "bot" programs because the game developer was no longer updating the security system.
Problem 2 is that he didn’t have control of the distribution system. Ebay eventually sided with the game developers and prohibited the sale of virtual items on its site. Overnight, Jim’s income stream became zero…or did it? It turns out, Jim was aware of the issues surrounding virtual economies and he saw it coming. It was only a matter of time before game companies used the copyright card against item-sellers. So he did what any smart entrepreneur would do: He moved distribution to his own website. His site listed the items and customers could use credit card, check, money order, and even Paypal (its funny how that works) to buy items. He SEO’d the hell out of the site until it was number 1 in the listings and now he didn’t even have to pay eBays listing fees.
Competitors Gain Entry
Competitors from Asia eventually began to enter the market. They didn’t have Jim’s super advanced computer system but they did have cheap labor. For 25 cents a day, they could hire a person to play the game all day and sell the proceeds for a $50 profit. Eventually these giant “farms” of people playing the game for profit threatened Jim’s business. Around this time, Jim met the owner of his biggest competitor who was also a US based computer operation and who was also feeling the heat from foreign competition. One thing led to another and they ended up partnering up. A new company was formed and they went on the offensive. Foreign companies lacked their technical expertise so they used this to their advantage. In order to keep Asian competitors from taking up the top search results for virtual items, Jim and his new partner created various copies of their websites that looked a little different and were hosted on different domains. This allowed their company to rank for ALL the top spots on Google’s search results pages even though they were owned by the same company. Very Smart!
External Factors A.K.A Luck
No success story is complete without the so-called “lucky breaks.”
- Jim was lucky that the game publisher did not decide to sue him for copyright infringement.
- Jim was lucky that he used bot programs in an old game before games were very secure. Nowadays it is very difficult to run one of these “cheating” or “bot” programs as game security has became an industry of its own.
- Jim was fortunate that many people were turned off by a “grey area” industry like the virtual goods market. This worked to Jim’s advantage because it kept competition low. The risk of being sued out of extinction was enough to keep out well-funded entrants.
- Jim was lucky that this particular computer game remained popular for so many years and is still being played by thousands of people to this day!
Final Thoughts
As you can see Jim’s business is a fastlane business because it follows the commandments CENTS pretty closely. Additionally, it is important to note that his company offers superb customer service. Their facebook page comments and their eBay seller feedback show this. It’s also interesting to note that what was once considered a “grey area” business, is now being embraced by game companies. Jim’s business will most likely die in a few years because game companies are now selling the virtual items themselves and these third party sellers are no longer needed.
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