Swedish video game and media holding company Embracer Group has just declared its financial report for the past fiscal year.
The post Embracer Group’s $3.9 billion full-year sales appeared first on WholesGame.
A new Lord of the Rings film is officially in the works, and it will feature some key personnel from both the original trilogy and the Hobbit trilogy. However, it won’t be original director Peter Jackson in the chair, but rather Gollum actor Andy Serkis.
It is going to be one of those Fridays where I am going to uncork a bottle of frustration and rant a bit about various business deals and statements, each of which has managed to make me progressively more annoyed. When I started this post I thought I might have to divert to Twitter to add in some of the more recent screw ups Elon has made. But no, the video game industry continues to provide, and the main problem was limiting myself to a few stories and ranking them in the order of how likely they were to make my head explode.
Back in the EG7 Q4 2023 financials it was stated that the PlanteSide IP had been sold. The actual mention was:
Daybreak successfully closed on the sale of a non-core IP for USD 5.9 million. The transaction provides EG7 with further improvement to its liquidity. This transaction will not affect EG7´s business plan and performance other than the P&L effect from the asset sale.
Closed a deal! Sold the IP! That must mean something, right? A publicly held company can’t just straight up lie about this sort of thing, can they?
It came out later that PlanetSide was the IP in question and that the trademarks had been transferred to Bay Tower, a private equity firm, but that there was some sort of Jason Epstein connection in that and what the hell was that even about and what did it mean to the actual game, PlanetSide 2? Let me just repost all the links from that point in time in case you are interested.
And I guess we don’t know the answer to a lot of that, but apparently PlanetSide 2 has been moved within Enad Global 7 to fall under Toadman, the smallest of the EG7 studios, which posted a net loss of $5 million SEK in Q4 2023.
That toad looks like he works in capital management
So now they had PlanetSide 2, in contention for the worst performing title in the Daybreak stable, has been moved to the worst performing studio in EG7’s stable.
Yay?
Some coverage:
Still, I should not be too hard on Toadman as, on their site they say they have done work for hire for a range of Daybreak titles including PlanetSide 2 and might have been responsible for the console port. Maybe them taking over PlanetSide 2 will mean a PlayStation 5 native client for the title? Who knows?
Meanwhile, that still doesn’t answer the question about the IP being sold, who really owns it, why they bought it, what they plan to do with it, or what it means to EG7, though I suspect part of the sale must had included the right to keep using the IP for PlanetSide 2 because to do otherwise would have been insane.
Back on the first of the year I made a prediction that UbiSoft would do something that would piss me off, and thus help sustain me in my beyond two decades grudge against the studio. And, of course, they obliged almost right away by declaring their Skull & Bones title a AAAA game.
But, just in case that wasn’t enough, we have how they are handling The Crew, their 2014 racing title, which they are pulling the plug on and removing from player libraries. If you try to find the copy of The Crew you paid $60 for, UbiSoft will suggest maybe you should buy something new rather than playing that raggedy old title. They managed to come across so badly that the whole thing is driving a call for game preservation. Some coverage:
Now, live service games are always going to be problematic in this arena. At some point the game will stop earning enough money to pay to keep the servers running… and keeping the servers running costs more than you probably imagine.
On the other hand, a title that charges full price up front better have a plan for when the servers go down. The servers to support the back end portions of Pokemon Diamond & Pearl were taken down years ago, but I can dig out my old cobalt blue Nintendo DS Lite and STILL PLAY the core portion of those titles.
Saying “Screw you, buy another game!” and yoinking purchases out of player libraries is not a plan, it is a way to bring the wrath of fans down on you.
This is UbiSoft management just being their usual shitty selves. Business as usual. I vowed not to give them another nickel when they made it clear they hated their customers more than 20 years ago, and they continue to keep proving it every year for me.
I was vacillating between making this its own Quote of the Day post or just ignoring it completely because it was so dumb, then hit a middle ground an decided it fit into this piece. Mike Ybarra, former head of Blizzard, thinks we should be able to tip devs if they make a good game.
That is pretty innocuous in and of itself. A charmingly naive desire to reward somebody for making a good game would earn a pat on the head from many sources.
However, a former President of Blizzard who demonstrated no issue with paying women less than men for the same job, only giving a mild bleat when Jen Oneal resigned because she was being paid less as Co-President of Blizzard in partnership with Ybarra, and who was blatantly trying to gaslight employees by pleading poverty while cutting bonuses for those outside the executive management boys club, coming out with that sort of statement against the background of mass layoffs in the video game industry just proves he is either completely unaware of reality or a complete shitheel… though, as always, I have to add “why not both?”
People rightfully dogpiled on his since edited tweet to point out the many problems with his sentiment. Leaving aside the whole “everybody wants tips these days” and the fact that any such mechanism would likely go to the publisher who would extract their cut before passing anything on to the people who did the actual work, the whole thing would encourage publishers and executives to keep industry salaries low by pointing out that tips were now considered part of the compensation package.
If you want to help somebody out, but another copy of an indie dev title you played the hell out of. That will probably help somebody. But tips… those will go into somebody elses’ pocket without a doubt.
Coverage:
Also, here’s to hoping Mike Ybarra fades into even greater irrelevance so I won’t feel the need to ever mention him again.
We got something of a two-fer from Jeff and Annie Delisi Strain, the husband and wife duo who run/ran Prytania Media which funded several game studios.
The first up was the abrupt closure of Crop Circle Games, which was shut down in late March with little notice and no severance for employees. A publisher treating game devs as disposable trash? Must be a day that ends in “Y” I guess. Crop Circle’s site was replaced by a terse statement about being able to secure funding after two years. Normal industry stuff, callous but no surprise.
The weird bit is that on April 4th Annie Delisi Strain appended a long rambling statement making the whole situation about herself and the fact that Kotaku reporter Ethan Gach was going to bring her health issues into a story (something that never happened and Kotaku denies was ever planned) that was so strange that even an AI wouldn’t be that incoherent.
Once that bizarre addition got some attention, the site was shut down completely, but not before I went and made sure the Internet Archive had backed it up. When gaming execs show you who they really are, don’t let them memory hole it later.
Then, a week or so later, Jeff Strain announced another sudden studio shut down (images of his statement), Possibility Space, this time because he alleges that employees were leaking information about their project to the press. The common thread here is again Kotaku, which was implicated as the reason, with their reporter Ethan Gach being named once more.
“Somebody leaked something so let’s burn the place down!” isn’t a normal business take.
Sure, the games industry isn’t doing well right now, contracting as it is from the pandemic highs when we all stayed home and added to our Steam library in search of distraction, so there are lots of reasons studios shut down. But when your funding publisher shuts down two studios while attempting to blame one reporter at Kotaku… well, it feels more like the Strains live in some sort of paranoid bubble where Kotaku is out to get them.
Then we’re back to the Embracer Group, which has been struggling to survive by shutting down projects and laying of developers, all due to some extremely poor and dubious even at first glance business decisions made by CEO Lars Wingefors… who still has his job.
Embrace This
But in an interview over at IGN about Embracer Group Matthew Karch, who is CEO of Sabre Interactive, which managed to break free of the disaster that is Embracer, paints a picture of Lars merely being naive and feels that people are being unfair. While the interview covers other topics, other sites like Game Developer immediately picked up apologist nature of Karch’s statements. Incredulity was a common response.
The only things I can come up with for Karch’s narrative is that there is a non-disparagement aspect to his contract taking Sabre out of Embracer’s grip, that he doesn’t want to say anything that will come back to haunt him if/when he too turns out to be an incompetent boob and lays off a bunch of staff, or just solidarity among the capitalist class and feeling the need to protect themselves from all those greedy workers demanding to be paid, as they really eat into CEO bonus potential.
Anyway, back here on planet earth Lars Wingefors, whose compensation package no doubt dwarfs any of the people who actually make the things that Embracer sells, is paid based on the clearly flawed assumption that he is SO SMART AT BUSINESS. Yet he foolishly bet on the line always going up despite obvious signs there was going to be a reduction in demand, negatively impacted the lives of thousands of people. And in doing that, the only consequence he has suffered is being publicly called out for it… and dammit, Matthew Karch says that is going way too far! CEO’s have feelings too man!
It is clearly too much to ask that a CEO be at all responsible for their decisions. Accountability is for suckers. Get a job where other people have to pay for your mistakes.
Maybe CEO should get tips.
Then, not really on the topic of video games, I saw a nice article over at Vox about how private equity firms… also known as equity management and other innocuous terms… have been simply destroying everything they touch in the name of milking every last cent out of companies and then casting them aside to let them fail.
They kick off with the example of Toys R Us and how it was bought stripped, and left to die as a deliberate business plan, but you can find many more examples. The plan is to find the victim target for the same tactic, where a private equity firms buys it out, brings it private, loots it of all value, saddles it with debt, then had a final cash grab by going public with it again in the hope that a familiar name would fool people.
It happens over and over again and the firms that do it set everything up so they get the cash but bear none of the responsibility for what they have done. Anyway, if you want to get mad, you can read that and how even Taylor Swift has had to fight the vultures of private equity.
There is the constrain refrain from the boss class in the US about “nobody wants to work anymore” that one can trace back over 100 years that is mostly a lament that people kind of expect to be able to live on their wages.
The irony in that is today it feels like nobody on Wall Street wants to run a business, they just want to get paid, either by demanding companies deliver all profits directly to them or through these private equity looting frenzies that destroy a company in the long term in order to get paid today.
We need more regulation in the market. That’s it. That’s the message.
After a year of carnage following its unprecedented studio acquisition spree, Embracer Group going back to basics and doing what it does best: confusingly re-naming and re-arranging its portfolio. The Swedish holding company is splitting itself into three new entities. The one in charge of the Lord of the Rings IP and Tomb…
It is going to be one of those Fridays where I am going to uncork a bottle of frustration and rant a bit about various business deals and statements, each of which has managed to make me progressively more annoyed. When I started this post I thought I might have to divert to Twitter to add in some of the more recent screw ups Elon has made. But no, the video game industry continues to provide, and the main problem was limiting myself to a few stories and ranking them in the order of how likely they were to make my head explode.
Back in the EG7 Q4 2023 financials it was stated that the PlanteSide IP had been sold. The actual mention was:
Daybreak successfully closed on the sale of a non-core IP for USD 5.9 million. The transaction provides EG7 with further improvement to its liquidity. This transaction will not affect EG7´s business plan and performance other than the P&L effect from the asset sale.
Closed a deal! Sold the IP! That must mean something, right? A publicly held company can’t just straight up lie about this sort of thing, can they?
It came out later that PlanetSide was the IP in question and that the trademarks had been transferred to Bay Tower, a private equity firm, but that there was some sort of Jason Epstein connection in that and what the hell was that even about and what did it mean to the actual game, PlanetSide 2? Let me just repost all the links from that point in time in case you are interested.
And I guess we don’t know the answer to a lot of that, but apparently PlanetSide 2 has been moved within Enad Global 7 to fall under Toadman, the smallest of the EG7 studios, which posted a net loss of $5 million SEK in Q4 2023.
That toad looks like he works in capital management
So now they had PlanetSide 2, in contention for the worst performing title in the Daybreak stable, has been moved to the worst performing studio in EG7’s stable.
Yay?
Some coverage:
Still, I should not be too hard on Toadman as, on their site they say they have done work for hire for a range of Daybreak titles including PlanetSide 2 and might have been responsible for the console port. Maybe them taking over PlanetSide 2 will mean a PlayStation 5 native client for the title? Who knows?
Meanwhile, that still doesn’t answer the question about the IP being sold, who really owns it, why they bought it, what they plan to do with it, or what it means to EG7, though I suspect part of the sale must had included the right to keep using the IP for PlanetSide 2 because to do otherwise would have been insane.
Back on the first of the year I made a prediction that UbiSoft would do something that would piss me off, and thus help sustain me in my beyond two decades grudge against the studio. And, of course, they obliged almost right away by declaring their Skull & Bones title a AAAA game.
But, just in case that wasn’t enough, we have how they are handling The Crew, their 2014 racing title, which they are pulling the plug on and removing from player libraries. If you try to find the copy of The Crew you paid $60 for, UbiSoft will suggest maybe you should buy something new rather than playing that raggedy old title. They managed to come across so badly that the whole thing is driving a call for game preservation. Some coverage:
Now, live service games are always going to be problematic in this arena. At some point the game will stop earning enough money to pay to keep the servers running… and keeping the servers running costs more than you probably imagine.
On the other hand, a title that charges full price up front better have a plan for when the servers go down. The servers to support the back end portions of Pokemon Diamond & Pearl were taken down years ago, but I can dig out my old cobalt blue Nintendo DS Lite and STILL PLAY the core portion of those titles.
Saying “Screw you, buy another game!” and yoinking purchases out of player libraries is not a plan, it is a way to bring the wrath of fans down on you.
This is UbiSoft management just being their usual shitty selves. Business as usual. I vowed not to give them another nickel when they made it clear they hated their customers more than 20 years ago, and they continue to keep proving it every year for me.
I was vacillating between making this its own Quote of the Day post or just ignoring it completely because it was so dumb, then hit a middle ground an decided it fit into this piece. Mike Ybarra, former head of Blizzard, thinks we should be able to tip devs if they make a good game.
That is pretty innocuous in and of itself. A charmingly naive desire to reward somebody for making a good game would earn a pat on the head from many sources.
However, a former President of Blizzard who demonstrated no issue with paying women less than men for the same job, only giving a mild bleat when Jen Oneal resigned because she was being paid less as Co-President of Blizzard in partnership with Ybarra, and who was blatantly trying to gaslight employees by pleading poverty while cutting bonuses for those outside the executive management boys club, coming out with that sort of statement against the background of mass layoffs in the video game industry just proves he is either completely unaware of reality or a complete shitheel… though, as always, I have to add “why not both?”
People rightfully dogpiled on his since edited tweet to point out the many problems with his sentiment. Leaving aside the whole “everybody wants tips these days” and the fact that any such mechanism would likely go to the publisher who would extract their cut before passing anything on to the people who did the actual work, the whole thing would encourage publishers and executives to keep industry salaries low by pointing out that tips were now considered part of the compensation package.
If you want to help somebody out, but another copy of an indie dev title you played the hell out of. That will probably help somebody. But tips… those will go into somebody elses’ pocket without a doubt.
Coverage:
Also, here’s to hoping Mike Ybarra fades into even greater irrelevance so I won’t feel the need to ever mention him again.
We got something of a two-fer from Jeff and Annie Delisi Strain, the husband and wife duo who run/ran Prytania Media which funded several game studios.
The first up was the abrupt closure of Crop Circle Games, which was shut down in late March with little notice and no severance for employees. A publisher treating game devs as disposable trash? Must be a day that ends in “Y” I guess. Crop Circle’s site was replaced by a terse statement about being able to secure funding after two years. Normal industry stuff, callous but no surprise.
The weird bit is that on April 4th Annie Delisi Strain appended a long rambling statement making the whole situation about herself and the fact that Kotaku reporter Ethan Gach was going to bring her health issues into a story (something that never happened and Kotaku denies was ever planned) that was so strange that even an AI wouldn’t be that incoherent.
Once that bizarre addition got some attention, the site was shut down completely, but not before I went and made sure the Internet Archive had backed it up. When gaming execs show you who they really are, don’t let them memory hole it later.
Then, a week or so later, Jeff Strain announced another sudden studio shut down (images of his statement), Possibility Space, this time because he alleges that employees were leaking information about their project to the press. The common thread here is again Kotaku, which was implicated as the reason, with their reporter Ethan Gach being named once more.
“Somebody leaked something so let’s burn the place down!” isn’t a normal business take.
Sure, the games industry isn’t doing well right now, contracting as it is from the pandemic highs when we all stayed home and added to our Steam library in search of distraction, so there are lots of reasons studios shut down. But when your funding publisher shuts down two studios while attempting to blame one reporter at Kotaku… well, it feels more like the Strains live in some sort of paranoid bubble where Kotaku is out to get them.
Then we’re back to the Embracer Group, which has been struggling to survive by shutting down projects and laying of developers, all due to some extremely poor and dubious even at first glance business decisions made by CEO Lars Wingefors… who still has his job.
Embrace This
But in an interview over at IGN about Embracer Group Matthew Karch, who is CEO of Sabre Interactive, which managed to break free of the disaster that is Embracer, paints a picture of Lars merely being naive and feels that people are being unfair. While the interview covers other topics, other sites like Game Developer immediately picked up apologist nature of Karch’s statements. Incredulity was a common response.
The only things I can come up with for Karch’s narrative is that there is a non-disparagement aspect to his contract taking Sabre out of Embracer’s grip, that he doesn’t want to say anything that will come back to haunt him if/when he too turns out to be an incompetent boob and lays off a bunch of staff, or just solidarity among the capitalist class and feeling the need to protect themselves from all those greedy workers demanding to be paid, as they really eat into CEO bonus potential.
Anyway, back here on planet earth Lars Wingefors, whose compensation package no doubt dwarfs any of the people who actually make the things that Embracer sells, is paid based on the clearly flawed assumption that he is SO SMART AT BUSINESS. Yet he foolishly bet on the line always going up despite obvious signs there was going to be a reduction in demand, negatively impacted the lives of thousands of people. And in doing that, the only consequence he has suffered is being publicly called out for it… and dammit, Matthew Karch says that is going way too far! CEO’s have feelings too man!
It is clearly too much to ask that a CEO be at all responsible for their decisions. Accountability is for suckers. Get a job where other people have to pay for your mistakes.
Maybe CEO should get tips.
Then, not really on the topic of video games, I saw a nice article over at Vox about how private equity firms… also known as equity management and other innocuous terms… have been simply destroying everything they touch in the name of milking every last cent out of companies and then casting them aside to let them fail.
They kick off with the example of Toys R Us and how it was bought stripped, and left to die as a deliberate business plan, but you can find many more examples. The plan is to find the victim target for the same tactic, where a private equity firms buys it out, brings it private, loots it of all value, saddles it with debt, then had a final cash grab by going public with it again in the hope that a familiar name would fool people.
It happens over and over again and the firms that do it set everything up so they get the cash but bear none of the responsibility for what they have done. Anyway, if you want to get mad, you can read that and how even Taylor Swift has had to fight the vultures of private equity.
There is the constrain refrain from the boss class in the US about “nobody wants to work anymore” that one can trace back over 100 years that is mostly a lament that people kind of expect to be able to live on their wages.
The irony in that is today it feels like nobody on Wall Street wants to run a business, they just want to get paid, either by demanding companies deliver all profits directly to them or through these private equity looting frenzies that destroy a company in the long term in order to get paid today.
We need more regulation in the market. That’s it. That’s the message.
Our overruling principle is to always maximize shareholder value in any given situation.
-Embracer Group, Calendar Q4 2023 Financial Report
This past week the train wreck that is the once ominously (and now tragically) named Embracer Group declared that sure, they were laying off staff and cancelling almost every project they had going, but it was because their “overruling principle is to always maximize shareholder value in any given situation,” which is such an astonishing lie that I combed Swedish police blotter entries for reports of individuals whose pants were literally on fire.
Embrace This… Comic Sans font used on purpose to register my disdain
Embracer Group has been the victim of tragicly incompentent management of the company, studios, and brands they own. Remember, these are the people who own all of Tolkien and declared that they were going to fix their issues by exploiting Middle-earth to the maximum.
If there were any justice in the world the senior execs at Embracer as a whole, and CEO Lars Wingefors in particular, would be run out of town on a rail, then face lawsuits and possible criminal charges for their overtly deceptive behavior at the helm of the enterprise.
Instead of reprecussions however, those execs are trying to claim they are very concerned about shareholder value while being shocked and surprised that their gamble with shareholder money did not play out.
The thing is, when you’ve screwed things up so badly and so deliberately, if you start spending your Saudi blood investment money before you’ve closed the deal and you don’t have the good sense to have a plan, then you have already blown your fiduciary responsibility to the investors, you have already proven that you do not, in fact, in any way, have the maximization of shareholder value in mind in the operation of your business.
You cannot fuck everything up and then claim to be a champion of the shareholders.
There is a lot to hate about that quote at the top of the post. Certainly at the top of the list would be equating short term stock price with shareholder value. Shareholder value is a lot more than that, or should be. I am keenly aware of the perverse incentives that reward short term thinking, that only what is happening in the current fiscal quarter matters, and how captial management groups and Wall Street in general hold companies accountable only on that dynamic.
All of this late stage capitalism where gambling on stock prices and demanding that the line must always go up is very bad and will always end in tears.
Tom Toro cartoon from The New Yorker
(You can read a bit about Tom Toro here.)
It is easy to get mad about that, and more people should be mad about that.
But Embracer isn’t even in that league. These fuckwits screwed things up in patently predictable and obvious ways, during which time they were clearly not considering shareholder value with any more depth than if they had gone to Vegas and put all of their money on red.
It was only after screwing things up and getting the company in a bind that they decided it was time to come out and make an empty declaration about shareholder value.
I am reminded of a Dennis Miller quote about nobody finding Christ on prom night. It is only when you’ve fucked everything up that seeking salvation seems like a good plan.
For once I am on the side of Wall Street. Or I would be if I had any hope that they would see through this bald face lie and vote the rascals out at the earliest possible opportunity. Again, justice would be the executive staff finishing their lives working at an off-brand fast food restaurant where their shift leader asked them at least once a week how the shareholder value thing was going. Hey Lars, how is the shareholder value today? Did that customer get any shareholder value with their lutefiske Lars? What are you doing at the deep fryer that is maximizng shareholder value Lars?
A man can dream.
Alas, it won’t come to pass. If there is one thing I have learned in life is that the rich take care of the rich. As a CEO you only face actual reprecussions if you betray your class. Even if they drive the whole thing into the ground, which they could still do given the business accumen they have shown so far, they’ll still get positions of responsibility, serve on boards, and prosper in all the little ways that show how the rich take care of their own.
Related:
Embracer bought Borderlands maker Gearbox Entertainment for $1.3 billion back in early 2021 amid an unprecedented acquisition spree that’s since turned into a financial disaster. Now, just three years later, Kotaku has learned that Gearbox is closer than ever to being sold out from under what is arguably the most…
Our overruling principle is to always maximize shareholder value in any given situation.
-Embracer Group, Calendar Q4 2023 Financial Report
This past week the train wreck that is the once ominously (and now tragically) named Embracer Group declared that sure, they were laying off staff and cancelling almost every project they had going, but it was because their “overruling principle is to always maximize shareholder value in any given situation,” which is such an astonishing lie that I combed Swedish police blotter entries for reports of individuals whose pants were literally on fire.
Embrace This… Comic Sans font used on purpose to register my disdain
Embracer Group has been the victim of tragicly incompentent management of the company, studios, and brands they own. Remember, these are the people who own all of Tolkien and declared that they were going to fix their issues by exploiting Middle-earth to the maximum.
If there were any justice in the world the senior execs at Embracer as a whole, and CEO Lars Wingefors in particular, would be run out of town on a rail, then face lawsuits and possible criminal charges for their overtly deceptive behavior at the helm of the enterprise.
Instead of reprecussions however, those execs are trying to claim they are very concerned about shareholder value while being shocked and surprised that their gamble with shareholder money did not play out.
The thing is, when you’ve screwed things up so badly and so deliberately, if you start spending your Saudi blood investment money before you’ve closed the deal and you don’t have the good sense to have a plan, then you have already blown your fiduciary responsibility to the investors, you have already proven that you do not, in fact, in any way, have the maximization of shareholder value in mind in the operation of your business.
You cannot fuck everything up and then claim to be a champion of the shareholders.
There is a lot to hate about that quote at the top of the post. Certainly at the top of the list would be equating short term stock price with shareholder value. Shareholder value is a lot more than that, or should be. I am keenly aware of the perverse incentives that reward short term thinking, that only what is happening in the current fiscal quarter matters, and how captial management groups and Wall Street in general hold companies accountable only on that dynamic.
All of this late stage capitalism where gambling on stock prices and demanding that the line must always go up is very bad and will always end in tears.
Tom Toro cartoon from The New Yorker
(You can read a bit about Tom Toro here.)
It is easy to get mad about that, and more people should be mad about that.
But Embracer isn’t even in that league. These fuckwits screwed things up in patently predictable and obvious ways, during which time they were clearly not considering shareholder value with any more depth than if they had gone to Vegas and put all of their money on red.
It was only after screwing things up and getting the company in a bind that they decided it was time to come out and make an empty declaration about shareholder value.
I am reminded of a Dennis Miller quote about nobody finding Christ on prom night. It is only when you’ve fucked everything up that seeking salvation seems like a good plan.
For once I am on the side of Wall Street. Or I would be if I had any hope that they would see through this bald face lie and vote the rascals out at the earliest possible opportunity. Again, justice would be the executive staff finishing their lives working at an off-brand fast food restaurant where their shift leader asked them at least once a week how the shareholder value thing was going. Hey Lars, how is the shareholder value today? Did that customer get any shareholder value with their lutefiske Lars? What are you doing at the deep fryer that is maximizng shareholder value Lars?
A man can dream.
Alas, it won’t come to pass. If there is one thing I have learned in life is that the rich take care of the rich. As a CEO you only face actual reprecussions if you betray your class. Even if they drive the whole thing into the ground, which they could still do given the business accumen they have shown so far, they’ll still get positions of responsibility, serve on boards, and prosper in all the little ways that show how the rich take care of their own.
Related:
Embracer Group, the proverbial grim reaper of video game acquisitions, has been wreaking havoc on the studios and IP it has acquired in the past few years. From layoffs across several companies to shutting down of beloved studios like Saints Row developer Volition, and cancellations of big, exciting projects like a…
Our overruling principle is to always maximize shareholder value in any given situation.
-Embracer Group, Calendar Q4 2023 Financial Report
This past week the train wreck that is the once ominously (and now tragically) named Embracer Group declared that sure, they were laying off staff and cancelling almost every project they had going, but it was because their “overruling principle is to always maximize shareholder value in any given situation,” which is such an astonishing lie that I combed Swedish police blotter entries for reports of individuals whose pants were literally on fire.
Embrace This… Comic Sans font used on purpose to register my disdain
Embracer Group has been the victim of tragicly incompentent management of the company, studios, and brands they own. Remember, these are the people who own all of Tolkien and declared that they were going to fix their issues by exploiting Middle-earth to the maximum.
If there were any justice in the world the senior execs at Embracer as a whole, and CEO Lars Wingefors in particular, would be run out of town on a rail, then face lawsuits and possible criminal charges for their overtly deceptive behavior at the helm of the enterprise.
Instead of reprecussions however, those execs are trying to claim they are very concerned about shareholder value while being shocked and surprised that their gamble with shareholder money did not play out.
The thing is, when you’ve screwed things up so badly and so deliberately, if you start spending your Saudi blood investment money before you’ve closed the deal and you don’t have the good sense to have a plan, then you have already blown your fiduciary responsibility to the investors, you have already proven that you do not, in fact, in any way, have the maximization of shareholder value in mind in the operation of your business.
You cannot fuck everything up and then claim to be a champion of the shareholders.
There is a lot to hate about that quote at the top of the post. Certainly at the top of the list would be equating short term stock price with shareholder value. Shareholder value is a lot more than that, or should be. I am keenly aware of the perverse incentives that reward short term thinking, that only what is happening in the current fiscal quarter matters, and how captial management groups and Wall Street in general hold companies accountable only on that dynamic.
All of this late stage capitalism where gambling on stock prices and demanding that the line must always go up is very bad and will always end in tears.
Tom Toro cartoon from The New Yorker
(You can read a bit about Tom Toro here.)
It is easy to get mad about that, and more people should be mad about that.
But Embracer isn’t even in that league. These fuckwits screwed things up in patently predictable and obvious ways, during which time they were clearly not considering shareholder value with any more depth than if they had gone to Vegas and put all of their money on red.
It was only after screwing things up and getting the company in a bind that they decided it was time to come out and make an empty declaration about shareholder value.
I am reminded of a Dennis Miller quote about nobody finding Christ on prom night. It is only when you’ve fucked everything up that seeking salvation seems like a good plan.
For once I am on the side of Wall Street. Or I would be if I had any hope that they would see through this bald face lie and vote the rascals out at the earliest possible opportunity. Again, justice would be the executive staff finishing their lives working at an off-brand fast food restaurant where their shift leader asked them at least once a week how the shareholder value thing was going. Hey Lars, how is the shareholder value today? Did that customer get any shareholder value with their lutefiske Lars? What are you doing at the deep fryer that is maximizng shareholder value Lars?
A man can dream.
Alas, it won’t come to pass. If there is one thing I have learned in life is that the rich take care of the rich. As a CEO you only face actual reprecussions if you betray your class. Even if they drive the whole thing into the ground, which they could still do given the business accumen they have shown so far, they’ll still get positions of responsibility, serve on boards, and prosper in all the little ways that show how the rich take care of their own.
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