PDLP Chapter 142 Epic
Chapter 142 Epic
Epic MegaGames' offices are located in a converted warehouse. With red brick walls, high ceilings, and an open-plan workspace, the walls are covered with concept art and code architecture diagrams for Unreal Engine.
The air smelled of coffee mixed with the aroma of electronic components.
Tim Sweeney was waiting for them in the conference room. He was in his early thirties, wearing a plaid shirt and thick glasses, and looked more like a graduate student than a company founder.
"Mr. Ling, welcome." The handshake was firm. "Shall we begin?"
"Okay." Ling Yun sat down.
Sophia opened her laptop. Zhao Hu stood in the doorway, observing the activity inside the office—a dozen programmers were engrossed in writing code, their whiteboards covered with mathematical formulas.
"We've studied the Unreal Engine," Ling Yun said bluntly. "It's amazing, especially the lighting system and collision detection."
Tim's eyes lit up.
"Can you understand it?"
"I can understand part of it," Ling Yun said honestly. "I'm not a programmer, but I can see that this is the foundation of the next generation of 3D games."
Tim smiled, a smile tinged with pride.
"We've invested three years of our time with the goal of creating cinematic real-time visuals."
"Do you have enough funds?"
Tim's smile faded slightly.
"We're in trouble. Engine development is slower than expected, and we've exceeded our budget."
"So you're willing to accept investment?"
"We can talk about investment," Tim said, sitting up straight. "But we won't accept an acquisition; Epic must remain independent."
"Understood." Ling Yun nodded. "We want cooperation on two levels. First, an investment in Epic Games in exchange for a stake. Second, a dedicated investment in the Unreal Engine project in exchange for technology licensing and optimization support."
Tim is thinking.
"Shareholding percentage?"
"We invested ten million US dollars in exchange for a 49% stake," Ling Yun said. "But we promise not to participate in day-to-day management, not to interfere with the technical direction, and to act purely as a financial investor."
"49%..." Tim frowned. "That's too high."
"We can reduce it to 40%, but the investment amount will remain the same."
I need control.
"You can keep 51%," Ling Yun said. "We only care about financial returns and strategic synergy."
Tim loosened up a bit.
"And the second one?"
"We've invested an additional two million dollars specifically for the development of the Unreal Engine," Ling Yun said. "In return, we'll take 20% of the engine's future revenue. At the same time, we've required the engine to be deeply optimized for the StarCraft system to ensure that its performance on StarCraft is no less than that on the Windows platform."
"Optimization requires manpower and time."
"We've sent engineers to join the development team, and we'll cover the costs," Ling Yun said. "Our goal is to complete the full adaptation of the Starry Sky system by the end of this year."
Tim remained silent for a moment.
"Can I ask you a question?"
"please."
"Why is the game engine so important? Isn't the Star System an operating system?"
"Because games are driven by technology," Ling Yun said. "Players have the highest demands for graphics, speed, and experience. If the Unreal Engine can run perfectly on the StarCraft system, it will prove that our graphics performance, memory management, and multi-threaded processing have reached the top level. This will attract more developers and hardware manufacturers."
Tim understood.
"You want to use the engine to prove the system's capabilities."
"Yes," Ling Yun said, "this is the best technology demonstration."
The meeting room fell silent. The sound of typing could be heard outside.
"A ten million dollar investment, a 40% stake, and you won't interfere with management," Tim confirmed.
"Yes."
"A special investment of two million US dollars, accounting for 20% of the engine's revenue, is required to deeply optimize the Star System."
"Yes."
Tim stood up, walked to the whiteboard, and wrote down a string of numbers.
Ten million dollars is enough for him to expand his team and speed up the process. Two million dollars in special funding can take the engine quality to the next level.
More importantly, the investors are technically savvy, patient, and not in a hurry for short-term returns.
"I agree." He turned around, "but the terms must be clearly stated: I have complete control over management, major decisions require mutual agreement, but only at the financial and strategic levels, and I have the final say on the technical direction."
"Okay." Ling Yun also stood up. "Sophia will prepare a draft contract."
"And one more thing," Tim added, "the optimization work requires you to provide complete system documentation and testing equipment."
"It will be provided."
We shook hands. This time, the handshake lasted a long time.
"To be honest," Tim said, "several investment firms have approached me before, all asking for control. You're the first person to truly understand the value of the engine."
"Because I know that Unreal Engine will change the industry," Ling Yun said.
After leaving the meeting room, Tim led them on a tour of the development zone.
A programmer is debugging a piece of code that reflects water. On the screen, the water shimmers and is rendered in real time.
"This is the latest physics simulation," Tim explained, "based on our own math library."
"It's very impressive," Ling Yun said.
"If we had enough funding, I could improve the image quality by another 30%." Tim's eyes burned with excitement. "Ten million dollars... I could expand the team to fifty people and build a professional motion capture studio."
"Then let's do it," Ling Yun said. "What we need is the best engine."
Back in the meeting room, Sofia had already drafted the contract.
Core terms:
1. IceCloud invested $10 million in exchange for a 40% stake in Epic MegaGames. IceCloud will not participate in day-to-day management or interfere with the company's technical direction.
2. IceCloud has invested an additional two million US dollars specifically for the development of the Unreal Engine, representing 20% of the engine's future total revenue.
3. Epic promised to complete the full adaptation of the Unreal Engine to the Astral System by December 31, 1997, with performance no less than that of the Windows platform.
4. Icecloud will send two engineers to join the development team, at their own expense.
5. Both parties shall establish a technology sharing mechanism and conduct regular exchanges in fields such as graphics, physics, and artificial intelligence.
Tim read each and every one of them carefully.
"No problem," he signed. "But the calculation method for engine revenue needs to be refined. We will be developing multiple versions later; how will the revenue be defined?"
"We're dividing it by version," Ling Yun said. "We're investing in the current foundational engine under development, as well as the three major versions that follow. We can renegotiate the new engines that come later."
"Fair." Tim also signed.
This contract is made in quadruplicate. Each party shall hold two copies.
It was nearly dusk when I left Epic.
Tim escorted them to the door.
When will the funds arrive?
"Within a week," Ling Yun said. "I'll pay five million upfront, and the remaining five million after the equity transfer is completed. The two million for the engine project will be paid next week."
"Okay." Tim shook Ling Yun's hand. "You won't regret it. The Unreal Engine will change the world."
"I believe it."
On the way back to the hotel, Sofia organized the documents.
"Mr. Ling, 40% equity, ten million US dollars, a valuation of twenty-five million. Is Epic really worth that much now?"
"It's worth it," Ling Yun said. "Once the Unreal Engine is released, Epic's valuation will increase tenfold. Moreover, we've secured technical cooperation and in-depth optimization, which is even more important for the Star System."
"That two million dollars in engine funding..."
"It's even more worthwhile," Ling Yun said. "A 20% share of the revenue means we'll get a cut of all games that use the Unreal Engine in the future. If the engine becomes the industry standard, that revenue will be astronomical."
Zhao Hu was driving and couldn't help but interrupt.
"Mr. Ling, you seem very certain that this engine will be a success?"
"Because I've seen the future." Ling Yun looked out the window. "The Unreal Engine will be one of the most important game technologies in the next twenty years."
The car arrived at the hotel.
That evening, Lingyun called Eric.
"We're planning to send two graphics engineers to Epic. The best of the best, with expertise in OpenGL and DirectX."
"When?"
"Next Monday."
"What about candidates? How about Jim and Andrew?"
"Sure. Tell them they'll be at Epic for at least six months. Their task is to ensure the engine is optimized for the StarCraft system to its highest level."
"clear."
After hanging up the phone, Lingyun stood by the window.
Three companies, three cooperation models.
Blizzard: Guaranteed revenue sharing in exchange for exclusive first release.
Sierra Entertainment: Acquired teams to gain access to online gaming technology.
Epic: Equity investment + special investment in exchange for engine technology and in-depth optimization.
Each has its own focus, but the goal is the same: to build a game ecosystem based on the Star System.
The first phase is now complete.
Next, we need to ensure that these collaborations are implemented and produce tangible results.
There's also the promotion of the UHSB standard, the release of USB flash drives, and the iteration of operating systems...
There are many things to do.
But he felt fine.
Because he is doing the right thing.
Use capital to drive technology, and use technology to build an ecosystem.
The road is long, but he is on the right track.
My phone vibrated. An Shiyu had sent a text message: "I passed my thesis defense, and my advisor gave me an excellent grade."
Ling Yun smiled and replied, "Congratulations. Let's celebrate properly when I get back."
When are you coming back?
"In a few days. Things here will be almost finished."
"Okay. Be careful."
"The same to you."
After putting down his phone, Lingyun said to Sophia, "Book your flight for the day after tomorrow, back to Silicon Valley. There's also the UHSB standards meeting to attend."
"OK."
The next day, they flew back to San Francisco.
On the plane, Ling Yun looked at the clouds outside the window, pondering his next move.
The game ecosystem has been initially established, hardware standards are being advanced, and operating systems are being iterated.
But the biggest challenge lies ahead: Microsoft's counterattack.