Cloud Imperium Games co-founder Ortwin Freyermuth assuaged concerns from the Star Citizen community when fans noticed that the studio had taken out a sizable loan from UK banking institution Coutts. The studio’s principals offered Cloud Imperium as collateral on the loan, leading many to believe that coffers had run dry developing Star Citizen. Financially savvy readers can view the filings here (courtesy of GameSpot).
According to Freyermuth, who addressed the rumors on Cloud Imperium’s forums, much ado was made over nothing. The studio’s relationship with Coutts enables it to receive advances on tax rebates, which in turns allows the developer to avoid converting currencies to British Pounds.
“Our UK companies are entitled to a Government Game tax credit rebate which we earn every month on [Star Citizen's single-player campaign] Squadron 42 development," Freyermuth wrote on Cloud Imperium’s forums. “These rebates are payable by the UK Government in the fall of the next following year when we file our tax returns. [We] have elected to partner with Coutts, a highly regarded, very selective, and specialised UK banking institution, to obtain a regular advance against this rebate, which will allow us to avoid converting unnecessarily other currencies into GBP.”
Freyermuth and his partners watch the financial market, and applied for the advance after considering which currencies make up the bulk of their income. Moreover, the Star Citizen IP is excluded from being offered as collateral in the studio’s agreement with Coutts, so there’s no concern that Cloud would lose control of its game. “We obviously incur a significant part of our expenditures in GBP while our collections are mostly in USD and EUR. Given today's low interest rates versus the ongoing and uncertain currency fluctuations, this is simply a smart money management move, which we implemented upon recommendation of our financial advisors.”
One could argue that fans had every right to be concerned over Star Citizen’s future. The game has raised tens of millions through crowdfunding since 2012, but seems gridlocked in perpetual development. Bits and pieces materialize, leaving many players to speculate when, or if the full product will surface.