Hitsville SE: How Paradox Interactive Became a Hit Factory

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Paradox Interactive has long been one of the more intriguing stories in PC gaming. From a small studio doing extremely niche historical games, they’ve become arguably the most successful medium studio in Europe, serving as both developer of surprise hits and publisher of a diverse range of titles. With 2015 still young, they’ve already had a landmark year. They serve as publisher for two recent critical and sales behemoths in Cities Skylines and Pillars of Eternity, while the fourth entry in their WWII series, Hearts of Iron, is due out later this year.

I chatted with Executive VP of Game Development Johan Andersson and COO Susana Meza Graham about where Paradox has been and where they’re headed after so much recent success. I spoke with Andersson on Skype, while Meza Graham and I corresponded by email. This interview is a combination of those two conversations.

Paste: So you’ve hit what can probably be deemed the big time, with both Cities Skylines and Pillars of Eternity breaking records. Are those sales something that you ever thought possible when you were starting out with Europa Universalis?

Johan Andersson: Oh gosh, that was 20 years ago when we started. No, never anything like this. I’m not sure what I imagined, maybe Magicka sales. But… I’m not really supposed to say how many Cities Skylines has sold right now, but it and Pillars… it’s a lot. But I never expected the sales when I was starting.

Paste: What is it about Paradox games that’s captured the public imagination? Obviously it’s the published titles, but Crusader Kings II is hardly a small game. What changed to facilitate the transition from a small studio making niche games to one of the most successful medium studios/publishers in the world?

Andersson: Well, we’ve had successes and some of the publishing titles have flopped and some have done decent. But there’s been basically two major reasons for why we’ve had success. First of all, the digital revolution. Without Steam and the switch from boxes to digital distribution, I don’t know that we would be as successful. Being able to go digital is huge because that means… we’ve sold I don’t know how many Crusader Kings II in the last three years, I think it’s 1.1 million or something. If we’d had to print you can never imagine the amount to print, we never would’ve made money on it to support our next project.

And also Fredrik Wester, our current CEO, when he became CEO, we had a different attitude in that it was more risk-taking. He’s more willing to take chances on stuff. Not crazy chances, but he’s willing to take chances. And since he’s become CEO, the company has grown constantly, every year basically.

Paste: Yeah, I was going to say, there’s an interview with the CEO of Colossal Order. And she said that they’d wanted to do a SimCity style game and it basically sat on the drawing board. Then, once EA’s SimCity flopped, they got the go ahead to make it. And now here we are, EA’s loss is Paradox’s gain. That seemed very smart, with Paradox willing to take that chance.

Andersson: Yeah, like we take chances but we don’t compete against… we only take chances when we see an opportunity.

Paste: You mentioned some of those poorly reviewed games in Paradox’s publishing catalog. One of the fascinating things to me is that, after Paradox got into publishing more, when a poorly reviewed game came out, it never really seemed to drag the company down and never, importantly, really damaged the perception of Paradox’s quality for their first party developed games. How do you rebound from a bad review when it happens?

Andersson: It’s different, I think, when you’re developing a game from when you’re publishing a game. I mean, if you’re publishing, you’re publishing lots and lots of games. You’re not as emotionally attached to the actual development. But it’s more, how does this impact the business, how does this impact our relationship with that developer, etc.

I mean, we’ve had some bad reviews on internal titles, if you call a 70 a bad review on Metacritic. But when you get bad reviews as a developer, when you’ve poured in your heart and soul and work, it means you go, oh, does this mean we can’t do these things in the future? They’re different repercussions.

Paste: One of the things that has always impressed me about Paradox, I’ve never heard about layoffs or mandatory crunch time. What is it about the company culture that lets you avoid those things?

Susana Meza Graham: I’d attribute the main reason to our stability to the way we operate our business. We continuously adjust our business model to fit our current reality and the changing reality around us. There are many concrete examples of these adjustments in our history. We took the plunge to become a publisher for our own titles in 2004; launched our first DLC in 2005—well before DLC was standard; started our own digital distribution platform and shifted over to digital sales in 2006. More recently we’ve developed a DLC policy including modular content always combined with free content and updates, keeping games like Crusader Kings II, a game released in 2012, in our most played and best-selling games category, broadening our offers and services like making our music more available for purchase, developing merchandize, creating Paradox books and more.

Regarding crunch and layoffs specifically, we have not had any layoffs to speak of for the past 10 years or so. But we’ve certainly had leaner times in between successes. We’ve grown organically, never believing that we needed to “hire to get something done”. Rather, we got it done and then assessed our need once the demand has materialized. We do have people who work overtime to meet deadlines, but never the type of crunching you hear about in those horror stories that are common in the industry. We try to reduce the length of those periods by being better planned and knowing that people don’t perform at their best if they are chained to the office. Also, because of our stability, many of us have also “grown up” in the industry and are now fathers and mothers, which is also a factor.

Andersson: We’re very conservative when it comes to money. We’d rather that we work a little extra but someone else takes the monetary risks if we can avoid it. Because layoffs… I don’t know. I don’t really like the concept of layoffs. Since we’re privately owned we don’t have to cater to a bunch of investors that are looking at the stock market, shouting “oh, cut costs”. You know how it is. And then, again, because we constantly have our back list of titles we’ve published which we own, we have the cash flow to keep paying for our people at the company.

Also, mandatory crunch. In the early days… I mean, I’ve worked at some other studios and I’ve crunched quite a lot. Even in the early days at Paradox, in my younger days, me and the other programmers, when we were in our early 20s, we had endless energy and we crunched a lot. But we realized that when you crunch it only works short term. It works for like a week, maybe two weeks. After that, your effectiveness just goes down the drain.

I’ve been in charge of internal development since Paradox started and I never really wanted to have crunch. So about seven or eight years ago I formalized it and said we don’t have crunch here. That doesn’t mean we don’t work overtime! We work overtime. A person can estimate that they’ll work overtime maybe ten or twelve days a year. And for us, that overtime is our “crunch”. That happens maybe at an alpha or release. We’re talking Monday through Thursday, maybe two to three hours extra on those days. We get the pizzas in at 6pm and then we work until 9pm. And that’s overtime.

Other people have plans. You can’t have a company ruining people’s lives for a game. I’d rather have a game which has an 80 Metacritic and people are happy working there than having a chance for an 85 but people are quitting.

Paste: Well it seems more sustainable. And the impression that I get is that some of the continuity of quality in Paradox’s games is because the core of the team is the same as it was fifteen years ago.

Andersson: Yeah. There are people who move after a while, but you’re right. The core people in charge of the internal studios are the same. I mean, I started there in 1998. Henrik (Fahraeus) in 2000, Thomas (Johansson), the current studio manager, in 2002.

Paste: Paradox and the studios it serves as publisher for have women in prominent, visible positions. Not just on Paradox’s board, but I’m thinking also of Colossal Order and their promotional videos featuring their CEO and lead artist (both women) very visibly. Is that sort of relationship with women in games something Paradox has tried to deliberately cultivate or is it just a byproduct of the types of games in the company’s portfolio? If more women in games is a priority for Paradox, what advice would you give to a similarly sized studio for getting more women in prominent industry positions?

Meza Graham: This is a topic with many dimensions. We believe a lot can be done by having female role models in the company, and creating a company culture where gender doesn’t really play a determining factor in climbing the career ladder. It’s important to proactively try to broaden your application pool when recruiting. If your applications are all very similar, challenge yourself by looking outside of your network or get good case practices from peers in the industry. What have they done that works?

Then there are longer term activities that we are also very involved in like getting more women interested in tech—not all studios can prioritize working on these type of long term strategies but we’ve reached a point now where we can afford the luxury of doing so. In fact in two weeks’ time we are co-organizing a tech/music festival with Robyn (the artist) to get women ages 11-18 involved in an interested in various aspects of the tech and IT field.

Lastly Colossal Order, like Paradox, is a great example of companies where diversity (not just in gender) is valued. And it would be hard for anyone to argue against the fact that the strategy seems to be producing quite good value for all involved.

Paste: Johan, you’ve been there, like you said, since 1998, the early days, and you helped place the emphasis on historical games. Before I let you go, let’s bring this back to Paradox developed games. Where did the fascination for historical grand strategy come from?

Andersson: The original company was started in, uhm… there was a boardgame company and a RPG company, started in the 1970s, by a guy named Fredrik Malmberg, who was, until recently, running the Conan brand [interviewer’s note: Paradox split into two companies in 2005, with Malmberg heading up Paradox Entertainment until recently. Paradox Entertainment owns the rights to the Conan property.]

So he ran this boardgame and roleplaying game company in the 80s which was very big in Sweden. All these hardcore board games imported from the US and making some of their own. So they had a really, really good reputation about boardgames in Sweden. The computer games started up in 1997. One of the games was a boardgame that we made, Europa Universalis. We were doing that game. We were doing… we had three different teams. My team was working on Europa Universalis. One was working on a really, really bad Viking semi-Baldur’s Gate style RPG action game that did not release. And Europa Universalis turned into a really successful game.

I mean, I liked history. And I moved back to Stockholm to make that computer game based on the boardgame. I loved playing games like Axis & Allies and so on. So since we had success with that one, we were like, “okay, let’s try some other areas”. We realized were just good at making these games and I still find it fun to play them. So we keep doing them.

Paste: Because you’ve been doing historical games for so long do you ever feel pressure to only ever make historical games? Or do you feel it would be okay if Paradox came out with, say, a space strategy game tomorrow?

Andersson: We’re constantly trying different types of games. We started making a RPG a few years ago. Sadly we canned it this winter because it was not as fun as we wanted. Now we’re not going to announce new games until they’re past alpha and we know we’ll release them. But I like having a healthy spread of new types of games, with the significant majority still being historical grand strategy games

Paste: Paradox has hit so many time periods with your historical games. Are we looking at any new time periods which you haven’t done in a game before any time soon?

Andersson: I very much doubt it. Because we’ve done everything from 700 to 1950 and we have the Roman time period. I don’t really like the Dark Ages period between the Roman period and the Viking era. There’s not that much fun going on. And before Rome is… argh! And I really don’t fancy the modern time period.

Ian Williams has written for Salon, Jacobin, The Guardian and more.

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