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Crytek CEO says he withheld pay in order to save the company

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Crytek came perilously close to insolvency during the past few weeks, and CEO Cevat Yerli had to take drastic measures to save the company, he said in an interview with Eurogamer. An injection of cash, the source of which Yerli was unwilling to name, has propped the company up for now. Crytek is down to 700 employees, from a high of around 900. Reorganization is still ongoing. Yerli could not comment on whether or not more studios or game properties would be up for sale in the near future.

Rumors have been swirling recently that Crytek missed its payroll. Yerli says he and the management at Crytek had to make a difficult decision to withhold paychecks and tried their best to prepare the employees for some tough times.

"You have two choices," Yerli said. "Either you delay payments — again delay... it's not that they didn't get paid, they got delayed — delay payments and salvage the company. Or, you push your cash flow directly to the studios and you file for insolvency. Both options are really bad. So you have to make the better of the two bad decisions."

Yerli says that employees were alerted, through internal communications, that payroll would be missed. They were encouraged to "work with different banks at a personal level to prepare." Alternately, they could resign and seek employment elsewhere. Those who stayed on with the company received bonuses, which Yerli called "inconvenience payments," once their paychecks resumed.

"Some people were very impatient and got angry at the smallest delay. Also, there was a critique of us not being proactive in communication, which we don't understand, because we had been frequently in the UK as well as every other studio, talking about potentially rough times."

"Our priority was to not downsize the company. Our priority was to not let anybody lose their jobs at that point."

Some downsizing was done however, including cuts at Crytek's Austin and UK studios.

Production for Hunt: Horrors of the Gilded Age, a free-to-play cooperative shooter which had been demonstrated for the first time in public at this year's E3 in June, has been moved entirely to the Frankfurt studio, where it can be closer to the Crytek "mothership." Meanwhile, Homefront: The Revolution and its team has been sold to Koch Media, a decision that Yerli says was a winning solution for both companies.

Yerli goes on to discuss Crytek's transition to games as a service. He tells Eurogamer that the company will be moving away from retail distribution towards more free-to-play titles in the future.

Eurogamer pressed Yerli hard on what these troubles mean for his personal reputation, and the transcript of the interview records several heated exchanges, including one about anonymous accusations that he is mismanaging the company.

"I don't want to defend myself because defending myself," Yerli said, "would imply me talking good about myself. Let me say it this way: if I really was a bad person I don't think Crytek would have such a loyal base. Are some people upset? For sure they are, because they have been let go. Am I making the best choices? There's certainly room for improvement. Can we learn more? Sure. Every day we try to improve."

"We are human. We wake up, go to our job, eat like everybody else, then go to sleep. In general we are flawed. If I did say something in the past that came across as arrogant, maybe it's because I don't speak the native language. But I don't mean to offend people. I just mean the best for people."

See below for a video history of Crytek.