Hotspring: A New Virtual Global Studio

Introduction

Jon: The company was founded around two years ago and before this, me and the other partner, Varun, founded a company called Trace Visual Effects, which was a visual effects company out of Mumbai, doing a lot of the heavy lifting for different clients around the world in visual effects and animation. So we built that company to run a thousand full-time staff and then we sold to Technicolor in 2016. And coming out of that, we saw that there are these pockets of talent all over the world and clients are looking for ways to access that talent. There's now more and more content being created than ever, but people need to figure out a way to do that at scale with artists all over the world. And what we saw was that there just weren't any tools out there to find that talent. There are hundreds of different sites that will give you reviews of the pizza places around, but there was nothing for this industry - being able to find really good companies and talent around the world doing the work in VFX, animation, and games.

So that's where the idea came from. We know that we've got a pretty good feel for where that talent is, we know the clients, so let's build a product and some software that helps connect those dots. So we started about two years ago. We raised some money to help build out the product and then we launched in February of last year right before the pandemic. But after the initial freak out, it actually shifted things toward the direction that knew things were going anyway - with more distributed remote working and breaking down those barriers from collaborating with people anywhere in the world. So that's kind of our background and where it came from. Ben joined us in July if you want to say about yourself?

Ben: So my background is very much visual effects production. I spend a long time at MPC and 12 years at the Mill where I was running the production team in London and then globally as well. So through the years, I've gathered quite a lot of contacts within the visual effects community who in turn became our first clients at Hotspring. So it's served me well in that respect. A lot of what I do at Hotspring is about growth and finding new clients and people interested in what we do. You know, showing them the product, getting them familiar with the kind of new workflow and a new way of working, and really expressing to them the value they can get out of using Hotspring. Specifically, things like faster bidding, saving on outsourcing – less work in production – and easier control in terms in terms of the outsourcing process. And also just producing stuff. So, yeah, it's quite a varied role, but my main focus is growth and getting new clients. 

Jon: Our work is about helping people who are creating content to find the talent they need no matter where they are. Whether it be visual effects for a movie or 3D assets for animation, (we're also exploring game development in the coming year) and things like that. Tapping into the talent network for people that are creating content. 

Products and Services

Ben: Our original services were primarily focused on visual effects support services; the traditional outsourcing services like rotoscoping, clean up, camera and object tracking. Things like that fall more into traditional outsource work, but we are now moving into other areas as well. For example, things like map painting, modelling, asset modelling, rigging and texturing because we've got some great people who can do this work in our talent pool through Hotspring. We're also doing some projects in Unreal Engine and that has let us outside of the confines of traditional VFX, commercials and advertising, into other areas. For example, we're also exploring architectural work or working with e-commerce companies to digitize their catalogue and providing CGI assets. And obviously, the gaming sector is an ambition of ours so that we can move into adjacent industries and start supplying assets for gaming companies too. And all of this work and all of these industries fit under this umbrella at Hotspring and allows our network of talent and the services they offer to grow.

Jon: And we are really excited about our future plans with Unreal Engine because we can see this change happening. Most of the stuff in the world is offline, right? It's a thing or a space that exists in the real world. But a lot of what people are trying to do when creating richer experiences is they need to bring it online. They need to convert that to a digital form, which then can be used in a lot of different ways. So we're seeing a lot of that happening. And what we can do, and what we're starting to explore more, is porting this stuff into Unreal, which then can be used in all different types of ways. For example, if you're an e-commerce company and you've got a coffee table that you're selling online, what they're doing is building AR experiences where you can see that coffee table in your apartment to see how it looks. And to do that requires a huge amount of asset creation. Every coffee table in their catalogue needs to be digitized. And that's where we fit in – doing this work at scale because you can access the talent that can do the work for you via Hotspring.

The Selection Process

Jon: On the vendor end, it is "invites only". So we're vetting those vendors and testing them to make sure that they're at a high level. And on the freelancer end, what we do is we let the network decide who should be executing things. So if a supervisor is assigned to do one hundred models, they will assign people that they know can execute that who will then come on to the platform and execute it. We let the network decide who are the best people to execute these tasks.

Essentially it allows people to move these assets around. So often they're very big; video files can be massive gigabytes. What the platform does is it makes it really easy for them to assign somebody. They get access to the stuff that they need to work on and then deliver it back. And then it just ties it all together in a really integrated, easy way. 

Ben: Imagine a client has got some CG Assets that they want to make. They can access Hotspring and easily set up a 'bid' and upload that material into the platform. We will then 'bid' it out to the platform's network of people that we think will best execute that work. Then we receive 'bids' for this work from those members of the Hotspring network who think that they can best do the work which we then present back to the client. They can then approve the bids on Hotspring and then once they've approved it, the assigned team will receive the correct data, they'll do the work and finally, they'll deliver the finished work back onto the platform. So think of it as a central hub whereby not only data can be passed between client and vendor, but also the project management can be organized, bids can be awarded, shots can be delivered. It consolidates the whole fragmented process into one central place and you can communicate with everyone at every step of the way.

Jon: Vendors have to be invited onto the platform. But what if clients who want to use the platform already have preferred partners that they work with? Well, they'll be able to nominate them as their preferred vendor on the platform. It links the two of them up. So now they are collaborating and using all the tools that Hotspring provides, but also get access to all of these new vendors within the network that might have a new skill you need, or so on.

The Business Model

Jon: So from the client end, and the people buying the service, it's completely free. There are no hidden costs, there are no subscriptions – it's totally free for them to use. So our business model is on the supplier end and the vendor end. So basically, like we just talked about, when somebody nominates a vendor as their preferred vendor, it's free for the client and it's free for that vendor. They can use the tools totally free. Nobody pays anything. Our revenue model comes in when the clients work outside of that network of their preferred vendors. So when they work outside of that, we take a commission on that work. So we're trying to align it so that if you've got an existing relationship, you can just use the tools and nobody pays anything. And we're only charging on new business for vendors. Any work that they wouldn't have access to before. And so we charge a commission on that. 

All payments run through the platform so that simplifies it on the client end. For some clients, there's just a monthly invoice for all the work that they've done with all vendors or freelancers on the platform. It's one invoice that they pay and then we distribute the money out to all the teams and we handle the payments and different currencies and parts of the world. That's part of what we do. 

That was one of the pain points for the clients and we're trying to remove those barriers for scale. The client can dump one hundred or a thousand assets on the platform to be done. And traditionally, they would have to find one hundred or a thousand freelancers to do that. That's a lot of work. You don't know who's good at the work, you've got to look through things, and you've got to manage 100s of people. But what the platform does is extract a lot of that away for you and the network will sort that stuff out. Through the network, the right people will get assigned to the work. It's similar to the payments, right? It's a huge accounting overhead to have to pay one hundred different people on all these different invoices and different countries. So it just reduces that issue. 

Partnerships

Ben: Obviously, Jon and Verun founded Trace VFX, which was a brick and mortar company before Hotspring. So that led them to have an enormous network of people that passed through the doors of Trace VFX through the years. And we have some excellent people from that company, but also from outside of that over the past 10, 15 years. The infrastructure in India has been growing to such an extent, particularly with the big visual effects houses like DNEG and The Mill and MPC and all these kinds of huge companies. The skill level in India in certain services is very, very high. There's lots of great talent. So accessing a large network within the core services has been relatively straightforward. But as we move into more niche or specialized outsourcing services like Unreal, for example, then we need to work a bit harder to find the right talent. They are there and there's certainly lots of support from people like Epic Games doing various training courses, et cetera. So the skill levels are rising very quickly. We've got some great people on board. We get presented sometimes with quite complex projects and we have to find people to solve them. I mean, luckily, we've got an operations team in India that is dedicated to doing that and is very good at finding talent to fill those gaps. So we haven't missed out on a project yet, but obviously, it's about finding the right talent to hit the mark required for the job. We're very conscious of that and we want to find the very best people. We do want to provide people that are skilled enough to deliver. So that's an ongoing thing that we're working on the whole time - just building up the network for the right level of people. 

With the pandemic going on it got trickier, but it also accelerated things. With a lot of these services, there was this idea that you couldn't do this in a remote way. To do this kind of creative work I need that person sitting next to me in the office. That's the only way it works. So when the pandemic happened, it removed that way of thinking because everybody was working remotely. So the difference between working with someone else down the road in New York versus somebody else in Sao Paolo was gone. It was the same thing. It was all remote. So it opened up people's minds a lot more about what is possible and who they can collaborate with globally. So that was the biggest change that we saw. It made people realize, oh, this does work.

Future Plans

Jon: I think it's about going on that journey from these core services in VFX that we're very familiar with and building the technology around those services has allowed us to build in a way that they can support a lot of other services. That's the kind of expansion that we're looking at. The technology works really well for taking a task that you need done at a high creative level and getting it done optimally by utilizing talent from around the world. Anything that's kind of "a thing" that needs to be done is what we're well-positioned for. We can see it go into a lot of different areas like architecture to create blueprints, and even further. But our current focus is definitely on creative services like VFX, animation, games, and growing out of those services across those segments.

Checking the Artists' Backgrounds

Jon: It's very hands-on for us in testing and vetting and making sure that the artists are of a certain level. But that's the part where the network kicks in. For example, if you're a supervisor who we vetted and we said, "yeah, this supervisor is really good, knows this stuff and can deliver what the clients needs" and they win this work consisting of one hundred shots, then your reputation on the platform relies on executing those hundred shots really well. So those people are assigning the people that they know can do that. In that way, the network sorts itself. They're not going to risk the execution of their job to people that aren't well equipped to execute. So they're assigning those people and they know who those people are. Each of these people has their own network that they've worked with over the years and they know can execute. And also, you know, being more on the ground, they're more adaptive to all the things that are going on. We let these people decide the best way to execute and give them the tools to do that really easily and build out their network to execute this and deliver. 

You know who are the people that you can execute well with and you work with them and that's different for every supervisor. And through that, it builds out the network. There are certain things that data is really good for and certain things it's not so good for. And this is one of those areas where we think the data really can't do that. If it's just saying one artist is four stars versus another one that's five stars, that doesn't really mean anything. It's really about who's the right person to execute on a certain type of thing. And that's really hard to capture with data. And that's something that you rely on people and their experiences and their knowledge to find the best way to do that. 

Conclusion

80.lv: So now that there has been a shift towards the democratization of tools to indie artists and smaller studios, what do you make of this? 

Ben: That's certainly been on lots of people's minds for years. I mean, lots of people have said, "Oh, one-day people will be doing this in their bedrooms" and some people fell into the camp that "It'll never happen" and a lot of people were in the camp of "It's definitely going to happen". But I think you're right. People have been able to access all sorts of very powerful tools recently and try them out and I think that's a good thing. The decentralization of these skill sets is exciting and it allows people who wouldn't necessarily get the opportunity to work in these fields to do so. I still think the cream will rise to the top and, if you're good enough, you'll get work wherever you work. And with Hotspring, we're actually enabling artists around the world, wherever they are, whatever their background, wherever they live, to work with fantastic clients through Hotspring. And that's a game-changer because beforehand they'd either have to move to a big city or they'd have to fight for a job at a big company. That's the only way they'd be able to access these clients. But right now the clients are actually searching out these people through Hotspring and they're able to connect with them and do work with them, wherever they're located. Having access to the tech is great, having the technology and tools like Hotspring to connect to the clients is great and then it's up to the talents of the clients and the artist to make stuff happen, basically. 

Part of what we do is we're removing a lot of those layers between an artist and a client. So instead of going through a company that has all this overhead and management and all this stuff, we're providing a more direct relationship between the client and the artist. Which means there's more money to go around. We've seen it happen where it ends up being cheaper for the clients and the artists earn more because we cut out a lot of these middlemen that traditionally stood between them. So in addition to all the benefits that Ben mentioned where they can work from where they want to work, they don't have to migrate to here. So, yeah, this whole democratization thing is something that we're really excited about , and we're trying to help along. 

Team Hotspring

Interview conducted by Ellie Harisova