The Business Side of HWBOT: First Half of 2016

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The Business Side of HWBOT: First Half of 2016

Although I don’t want to make a habit of reporting on the business side of HWBOT, it’s good once in a while to share more details on the business side of HWBOT with the community. In last year’s HWBOT year overview I summarized some information shared in the XOC Focus Group private sub-forum on how we spend the income. In this article I want to share a bit more detail on how we spent our budget in the first half of this year.

PS: Coincidentally LinusTechTips just published a video explaining how they earn money. I’m not publishing this article following their example, but I do think it’s interesting video content.

HWBOT Activity and Structure

First of all, let’s have a look at how we organize our activities. HWBOT’s activities center around 4 pillars: Community, Education, Competition and Technology. For each of the four pillars we have one or more activities that we put more or less focus on.

Community revolves around the promotion and support of the overclocking community. It includes organizing and promoting gatherings, spending time talking about our past and future and of course maintaining the overclocking result database. Good examples of our approach to the overclocking community are organizing an Overclocker’s Gathering the day prior to Computex and the SuperPI 32M timeline which featured as the pièce de résistance at the World Tour 2016 Asia.

Education revolves around getting new people into overclocking and sharing information relevant to the hobby. It includes the workshop events we host and support and the written overclocking guides and write-ups on the state of the enthusiast scene. Good examples of this major item are the MSI OC Academy at Gamers Assembly which attracted 200 participants, the Pro OC Program which supports experienced overclockers in sharing their knowledge and information and most recently, an opinion piece on the Core i3 K processor.

Competition involves the entertainment aspect of overclocking. It includes hosting sponsored and in-house organized overclocking competitions at OC-ESPORTS as well as keeping track of the latest benchmark and overclocking world records. Good examples of this pillar are of course the Road To Pro structure with the seven Challenger Divisions, our support of the G.SKILL OC World Cup competitions and the newsflash articles about Global First Places and World Records.

Technology involves the promotion of overclocking as pushing the boundaries of consumer technology. It includes the maintenance of the overclocking result database as a tool to compare system performance and the importance and value we attribute to extreme overclocking results. It also includes the once-in-a-blue-moon performance scaling articles we publish on the site. Good examples of this pillar are the newsflash items regarding new benchmark performance records and the World Series and World Championship live competitions.

These four pillars feed into our main activities:


First Half of 2016 Finances

I want to make an important note before we get to the numbers: HWBOT is a private company and it is therefore not mandatory for us to share any of the financial information with the public. In the section below I will shed some light on the general financials of HWBOT, but of course we won’t go into too much detail on exact revenue streams or expenses. The figures presented here are cash-based.

In the first half of 2016, we have an operating margin of 18% which is down from 23% in the first half of 2015. Overall the revenue went up 83%, though our expenses increased by 93%. This is due mostly to the World Tour; we hosted 5 events instead of 3.

Breaking down the expenses, we spent 32% of the available budget on Event Organization. This includes the World Tour, the OC Gathering as well as all related costs (i.e. Eventbrite fees). In absolute figures, we spend 2.5x more on events than last year. During the first half of 2015 we spent ‘only’ 18% of the budget on events. Our Travel costs have also increased, but remain less than 10% of the budget. The travel costs include not only air plane tickets for the HWBOT staff attending the World Tour events, but also accommodation for volunteers where possible. Prizes (i.e. cash winnings) and Pro OC contributes to 11% of the expenditure and is up 129% in total compared to last year. Employment and Consultancy Fees take up roughly 23% of the budget and include the compensation for all salaried employees as well as the remuneration for Christian Ney and Websmile (more on this in the next section). Last but not least, the Server, Domain and Web Development takes up about 8% of the budget and is in absolute figures roughly the same as last year.



Second Half 2016 and 2017

Our main focus for the rest of the year will be to successfully wrap up the final World Tour event and organize a kick-ass World Championship at the end of the year in Berlin. We will communicate about both events shortly, but those who want to attend the final World Tour stop may want to clear their calendar in the first week of September and look out for tickets to Indonesia. We will also spend a lot of our time on HWBOT X, the platform for overclocking event organizers. Timothee (Xyala) will be traveling alongside Isaie (Trouffman) to the Summer 2016 Party in PA, USA, and we are in the planning phase of a couple more local community events. Just like last year, we intend to complete our World Tour 2017 and general business plan for 2017 at the end of the summer (the early bird catches the worm, as the saying goes). We will share those plans with you as well.

One important focus point for me personally is to find a solution for the (under-funded) community management of the site. As mentioned in the previous section, we do remunerate Christian and Michael for their hard work and incredible support on (and off) the forum. Also, when the budget allows for it we try to cover travel and accommodation costs at overclocking events. But it can always be better. After all, the staff takes care of the community with incredible care and attention. Just to give you an idea: Gregor (Strunkenbold), Albrecht (Leeghoofd), Christian and Michael (Websmile) together moderated 8,600 submissions already this year. That’s 47 per day! There’s plenty of work for at least one full-time, or a couple part-time positions.

In the next couple of weeks and months, I’ll be looking together with Christian and the rest of the staff for possible sources of income to fund self-sustainable community management. A central element of this search will be to ensure that the priority of the community management will be to take care of you, the community, remaining accountable to the community and its interests alone. There are tools like Patreon that already provide this kind of support structure and we welcome any ideas or feedback from you. If you think it’s a bad idea, let us know as well!

Thank you for your support and passion!


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