Inside Paradox, the strangest company in video games

Paradox Interactive is a strange company. Now, don't get me wrong, strange can often be a good thing and I certainly am not using this term pejoratively, but Paradox Interactive is strange. Its portfolio is a hodge-podge of critically acclaimed genre titles, surprise successes and widely panned, sometimes alarmingly broken disasters. The eccentric image it projects extends within as well as without, with would-be interviewees facing questions like "Are you a Stark or a Lannister? A Kirk or a Picard?" some of which may be delivered to them by a man who has used the title Vice President of Business Development and Manager of the Unicorn Division.

Its PR philosophy sits somewhere between openness and frankness. In an industry where PRs usually strictly control the flow of information between writers and developers, games journalists are encouraged to email development teams directly, while Paradox staff openly, candidly reflect on their failures as much as they celebrate their successes. It's beholden to no-one and, should it feel the need to adopt a corporate anthem, it wouldn't be inappropriate for it to be singing "I did it my way," though with the addendum "and sometimes it really didn't work."

The history of Paradox Interactive is also a little strange and it begins, as so many of the best gaming tales do, with board games. Then, a famous barbarian appears and later an Argentine software pirate inspires a key business decision.

This is the story of the Swedes who say what they think and who try what they fancy.

* * *

It begins with a company called Target, a publisher of tabletop games, deciding to edge its way into video games in the 90s with a title inspired by one of Sweden's most popular board games, Svea Rike. Svea Rike was a success but Target's fortunes waned and the company was bankrupt before the millenium, selling off its fledgling video games division to form a new organisation: Paradox Entertainment.

Paradox Entertainment picked up the Svea Rike series and also released another, more ambitious board game adaptation in 2000. It was a grand strategy game called Europa Universalis and it was to have a tremendous influence upon the company to this very day. Work began on several other grand strategy games: a sequel; a World War 2 title called Hearts of Iron; the industrial-era Victoria; the medieval Crusader Kings. The appeal was increasing, the fans were growing.

But the company also began publishing other, often remarkably substandard titles. The dull RTS Chariots of War, the lousy RPG Valhalla Chronicles. Paradox Entertainment diluted its portfolio with garbage, one veteran employee explains, and he says it didn't seem too bothered.

"Instead, they just invested the money they earned [from these games] into buying a bunch of brands," explains Johan Andersson, who joined Target in 1998 and who brought Europa Universalis and its children into the world. The former Funcom programmer had previously worked on arcade games, but when you speak to him it's clear that strategy is his passion. He is also, like many of Paradox's employees, quite frank, particularly in his disdain for Paradox Entertainment. "So, in 2004, a lot of the people in management thought 'Oh, having all these brands would be much cooler, so now we'll just own brands and make movies instead.'"

Far more interested in acquiring properties such as Conan the Barbarian and Solomon Kane, Paradox Entertainment sold off its video games division and moved on. This, it turned out, was a blessing, a chance to start anew.

CEO Theodore Bergquist remained. Alongside Andersson and an ambitious consultant by the name of Fredrik Wester, they formed what would be known as Paradox Interactive and, in a scene dominated by Grand Theft Autos and first-person shooters, ignored trendy gaming in favour of what they themselves loved. They would develop or acquire the sort of deep, complex games they enjoyed, the "games that always defined Paradox," says Wester.

And, in time, Wester himself was also going to define Paradox. After an Argentine pirate contacted Paradox to ask how he could pay royalties for their games, Wester and Berquist set up the digital distribution service Gamersgate (digital sales are now over 97% of Paradox's business), before Wester bought out Bergquist's stake in Paradox and took over. That was when Paradox really began to say what it thought.

* * *

"They're games," says Shams Jorjani, "for people who can nerd out."

It's Jorjani who holds the unexpected title of Vice President of Business Development and Manager of the Unicorn Division, and it's his job to seek out games that fit Paradox Interactive's rather acquired tastes. While a glance through their catalogue might suggest Paradox casts the net wide, Jorjani says they are very particular in the sort of titles they publish.

"We want games that have a high average play time," he says. "We like people to be able to spend hundreds of hours playing, if not thousands. We want the game to have a lot of replayability and we want the game to have a hardcore component to it. The term 'hardcore' almost means nothing today, because people would describe Call of Duty as a hardcore game, but basically we call it smart games for smart gamers. We want something that challenges the player who, in turn, demands a lot from the game."

Games like these aren't always cool. They aren't always the sexiest or the shiniest titles around ("Graphics are a means to an end, they're not an end. We don't need pretty graphics to sell a game."), but Jorjani says they are the games that players return to again and again. They're also games that tend to have the potential for expansion, which can make good business sense. Paradox is a dab hand when it comes to providing add-ons.

Jorjani describes this as a "long tail." A game that players still aren't tired of after months or even years of play can generate much more revenue through DLC. "Whenever people play and really like a game, they just want more content," he says. "From a business standpoint, there's no reason why you shouldn't provide this. People who love it just want more of it."

And Paradox is very much on the lookout for new acquisitions. The last few years has brought it considerable success. After several years of steady growth, it was 2011 when the magic happened.

* * *

35,000 Swedish Krona isn't quite so much money when you split it between eight university students, but that was the sum Arrowhead Studios pocketed when an early version of Magicka won the Swedish Game Awards. Of course, the real prize was the prestige gained and the attention it brought to the young developers. Paradox snapped up a game in what Jorjani says "was a very deliberate experiment," but which they felt had a lot of potential. That, it turned out, was an understatement.

Released in early 2011, Magicka was remarkably original, buggy as hell and tremendously popular. It would go on to sell more than 1.3 million copies and serve as the perfect example of that "long tail," with over four million DLC purchases to follow, including new levels, new items and even new character costumes.

It was an enormous success for the publisher (who saw a 250% rise in their profits), a catalyst for its growth and, in many ways, the quintessential Paradox title: it had complexity, variety, expandability... and the odd technical hitch. While Paradox was cementing its reputation as a publisher of deeper, smarter games, its quality assurance was being called into question and it was scoring some real howlers.

Back in 2009, the third installment of the increasingly popular Hearts of Iron series had been crawling with bugs. Though some serious subsequent patching addressed most of these issues, Jorjani openly describes the launch as "a disaster." Several subsequent Paradox releases were somewhere between wobbly and outright broken, with Sword of the Stars 2, King Arthur 2: The Role-playing Wargame, Pirates of Black Cove, Gettysburg: Armored Warfare and Ship Simulator Extremes all taking a critical beating.

Paradox was not developing a good reputation. The solution was to admit everything.

Before moving onto a production role, Linda Kiby spent two years as Paradox's community manager, talking directly with gamers who had their fair share of grievances. While it's not unusual for many companies to put on a brave face or spin a situation, Paradox's approach was a plain-speaking acknowledgement that she believes wouldn't be possible elsewhere. Why? "We don't have a big, bad publisher who tells us what or what not to say," she explains.

Instead, admitting there are problems is the first and only step towards fixing them. "No-one is going to say 'Oh God, why did you admit that your game had this bug?!'" she says, adding that hearing this from a developer is not simply an admission, but also a validation. Plus, the feedback is essential for Paradox to try and understand problems gamers are having and all the company's staff are keeping an eye on the community. "Everyone [at Paradox] is on the forums," she says. "And they have to be, because we use a hidden part of the forum for our own bug reports. That way, the step towards contributing to the community isn't so big."

That 'everyone' includes Andersson, who has no interest in trying to dodge questions and who appears disappointed with those who do. "Why lie to people?" he asks, as if the idea is incredulous. "People are always going to find out if you lie, always. In the long run, if you keep lying, if you keep hiding stuff, people will find out."

Wester himself also practices something he asks his staff to preach, devoting a considerable portion of his time to responding to players via the forums, Twitter and email, often to criticisms. "If I get a question like 'Why was this game buggy on release?' I'm going to say 'We made this mistake. We made that assumption,'" he says.

"I'm surprised that a lot of people in the games industry aren't open, especially when they fail with something. Just go out there and talk to people, because if you fix the problem, people will be happy. If you're just silent and hope everything will go away, people will start making assumptions," he says. "If there's a discussion about your company, you want to be a part of that discussion."

Under Wester, Paradox's openness has lead to some particularly noteworthy statements, including last year's direct admission that strategy title Magna Mundi was cancelled because Paradox did not trust the development team. Wester says Paradox's only rule for communication is that "it must be something you'd let your mother read," though that hasn't stopped him from indulging in the occasional snark. One Wester classic: "Ubisoft was recently bragging about having the biggest 3DS portfolio. It's like having the best typewriters."

"Being honest and open about things is better in the long run than bullshitting and giving some sort of corporate answer," says Jorjani, who apparently didn't get Wester's memo. "As soon as you stop communicating in an honest and open way about why stuff goes to hell, that's when people start filling in the blanks."

He also hasn't been shy about saying what he thinks, sometimes about other studios, and concedes that being so vocal "definitely burned some bridges," but it also brings with it a benefit of sorts. "Generally speaking, we try to be outspoken," he says. "We've got an competition to see who's tweets get picked up the most by media. I often feel that people in the industry (gamers, journalists, devs and especially business people) keep tip-toeing around subjects instead of just putting things plainly."

Of course, Paradox isn't entirely without restraint and, for all its bluntness and open PR access, it still keeps its plans close to its chest. Magicka opened a lot of doors for Paradox, we've still yet to see where many of those will lead and there's every possibility there could be further failures and disappointments behind some. Certainly, Jorjani and Paradox expect this.

* * *

Following the tremendous success of Magicka, Paradox Interactive scored a second surprise hit a year later with Crusader Kings 2, the latest branch on the family tree that began with the first Europa Universalis. These grand strategy games had always been a core part of what Paradox was, the spine that ran through the company, but they were still as niche as any of their other titles.

"We were very stable," says Kiby. "We know how much our games are going to sell. Financially, we're not a big risk." But then Crusader Kings 2 starred in several Game of the Year roundups. It sold over 300,000 copies and, according to Andersson, "an insane amount of DLC," with that "long tail" once again proving an earner. The most popular DLC was a custom ruler designer which Andersson's team are proud to have taken from forum suggestions.

With growth comes change and today the team behind those grand strategy games exists as Paradox Development Studio, a separate studio under the Paradox Interactive umbrella. Further budding comes in the shape of the Paradox North studio who, according to vice president John Hargelid, "are the team that's going to focus more on action and more fast-paced, online experiences." They've been given a chance to share in the Magicka brand with the multiplayer Wizard Wars, while a tablet version of Magicka also apparated this year.

These may represent some of the safer bets for Paradox, but Jorjani says the company is not only afraid to take risks after its success, but that it has been doing so for some time. It's been taking pitches from indie studios and it's happy to experiment, to dip its fingers in many pies and see which, if any, taste good.

"After Magicka, we knew that we were going to do a lot of crazy stuff and that a lot of that crazy stuff probably wouldn't pan out," he explains. "In hindsight, maybe we should've taken a closer look at some of the titles, but we were in a position where the company needed to grow and we needed to take some risks. We did a number of multiplayer-only games. Doing a multiplayer game isn't necessarily a bad thing, but doing four in a row? We worked on five or six games with first-time developers. Working with first-time developers is a great thing, but maybe not six of them at the same time."

Investing in multiple smaller projects for shorter development periods is their preferred approach and it's a little like playing a software stock market and seeing what pays out. Often, says Wester, there are big surprises. "If we like it, that's never a guarantee that other people will," he says. "If you take a game like Impire, I liked that game personally, but it scored 44 on Metacritic. For Crusader Kings 2 we had our target audience, we knew what to expect, but I'm still surprised at how well it did. Some games we were forced to ship out, because we didn't have the cash to do the job we should've done, but that's all changing now."

"We'd rather do, say, 20 crazy projects for a million dollars each, rather than one big one for 20 million," Jorjani continues, illustrating how a single, big investment might result in a single, grand failure. "Sure, not everything will pan out, but we don't have to sell five million copies of a game for it to be successful. Now, we're probably going to greenlight and start many, many more games than we used to, but we're also going to kill off more. That's maybe one thing that we should have done before. But if this means that we can try out even more crazy concepts that nobody else dares to do, then that's advantageous. Anything that allows us to be more avant garde is good. Anything that keeps us away from being a sequel machine is good."

In separate interviews, Wester and Jorjani both repeatedly emphasise the independence Paradox enjoys, the freedom to experiment and the need to answer to no-one, and I find my discussions with just about anyone at Paradox return to this subject sooner or later. Really, it's Wester's money to invest as he wants, where he wants. When I ask Jorjani about Paradox's failed bid for the Homeworld IP he seems almost relieved that they never felt that burden of expectation, that constraint.

"In a lot of ways I'm kind of happy that we didn't end up having to make that decision. I know that it would've ended up on my desk and I would've been trying to come up with a way to please all those thousands of Homeworld fans," he says. "Say we would've won the Homeworld bidding and decided that we have to do a Homeworld 3, that would've been a giant product. We'd probably have to sacrifice doing a bunch of other, smaller projects that are in many ways more innovative. We were open to the idea of just being quite frank, telling the community 'This is the deal, guys. We currently have no clear direction for the series, we'd like you to tell us where you'd like it to go!'"

* * *

The idea of Paradox Interactive taking on a major license or IP seems entirely at odds with the direction it's taken itself in. It tries what it wants and it says what it wants, something that makes it sound like the corporate equivalent of the kid who doesn't play well with others. I don't imagine they're likely to change any time soon, but if it keeps trying new things, Paradox will keep itself quite happy. "Personally, I want to work with games that I want to play," Wester says. "Maybe I'm just being selfish about that."

But it's a sensible selfishness that runs through the company, much as, for all their outspokenness, Paradox have never said anything truly dumb foolish. Before Wester took the stage at Paradox's annual convention this year, my peers were hastily double-checking their dictaphones, ready to catch any bombs he might drop. But none fell, and while those peers described Wester as "a character" and "liable to let something slip," he's not tactless, he's just direct. And I'm sure he keeps his secrets.

As I leaf through my notes and play through my interview recordings I realise, for all that Paradox has told me, there must be a dozen more tales of unfinished games and unrealized ideas. For all it's told me about what they have done or will do, I don't have nearly as many stories of roads never travelled. But there is one nugget. It's Paradox at its cheekiest, its most eccentric.

"We were this close to patching in an Error 37 message in Magicka." says Jorjani, referring to the fatal technical error that locked many players out of Diablo 3. "An error where no-one could play. Then we even tried to work out a scheme to give a copy of the game to everyone who'd got an Error 37." Sure that idea was shot down for making no business sense? "No. We couldn't find a way to distribute that many codes. We should've done that. It could've been great PR."