Governor scared away Publisher from investing
More pieces of the 38 Studios puzzle ordeal are now becoming public, thanks to comments from a number of sources. Curt Schilling personally stands to lose approximately $50+ million dollars over the closure of 38 Studios.
Schilling is claiming that provocative public statements by Rhode Island governor Lincoln Chafee scared away a publisher from pumping $35 million into the company to finance the sequel to Kingdoms of Amalur, which would have had the potential to save the studio. Instead, the publisher pulled out after Chafee’s comments, and now almost 300 people are unemployed.
In addition, Schilling claims that the state didn’t keep its end of the bargain after it reneged on a deal to approve tax credits, which would have helped the studio. If that was not bad enough, the state also apparently backpedaled on a deal to allow the loan payment to be deferred to pay the 38 Studios staff while the deal closed to get the financing in place for the sequel of Kingdoms of Amalur, which then would have then allowed payment to the state.
Schilling claims that he was never looking for a government bailout. Right now, the entire thing looks like a tale of how not to run a development studio, in our opinion. What perhaps might be the most important lesson is that getting your business intertwined with the working of the government can surely make a mess of things. No additional info has been released as to the future of the 38 Studio’s possible rescue or IP, and as the days pass it would appear more and more likely that the final chapter of the studio has been written; and all that is left is the auction.