One 38 Studios Document Shows Why RI’s Investment Was Simply Absurd
GoLocalProv News Team
One 38 Studios Document Shows Why RI’s Investment Was Simply Absurd
While Rhode Islanders have questioned the decision to invest $75 million of a loan guarantee fund in the fragile 38 Studios in 2010, one key document buried among thousands is a budget document prepared by Rick Webster, the then-Chief Financial Officer of 38 Studios, in which he outlines in a financial summary sheet that in FY 2010, 2011 and 2012, the company would lose over $92 million during this period.
The document is dated April 1, 2010, but is in a group of documents dated in August 2010, just after the RI EDC board approved the deal, but two months before the bonds were issued and millions were distributed
According to 38 Studios' own projections, even with the infusion of $75 million, 38 Studios’ cash position (if all stayed on schedule with the production and marketing of the games) would dwindle to just $13 million at a time that expenses would rise to $75.1 million in FY 2012. The company would have less than two months operating cash.
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Donald Carcieri Transcript - Part 1
