The Self-Made Man: Mike Krahulik and Jerry Holkins

Mike Krahulik and Jerry Holkins, the creators of?Penny Arcade, are nerds. And not in that tech-savvy Ivy League hipster way that all the thirtysomething dot-com millionaires are. Krahulik and Holkins spent their teenage years getting punched around by jocks and worked crappy jobs as adults (Krahulik stocked shelves at Toys-R-Us and Circuit City, while Holkins was an IT guy for their school district) to support their video game and comic book consumption, hoping that one day they’d create something big.

As it turns out, they did. And unlike Jim Davis or other cartoonists, they’ve never had or needed newspaper syndication. Penny Arcade has a distinct and loyal following to the tune of 55 million pageviews a month and 30,000 visitors at their annual convention, the Penny Arcade Expo. Krahulik and Holkins support themselves and pay their 10-person staff from the ad and merchandise revenue their webcomic generates, and video game companies line up at their door for shout-outs in the comic strip, or to pay them for custom design work. They even made two Penny Arcade video games. Not bad for two guys who didn’t have lucrative internships or well-connected parents to help them along.

Penny Arcade

It wasn’t always this way, though. Krahulik and Holkins started Penny Arcade in 1998, and published it on an obscure gaming web site for free. The learning curve was steeper for them than for other entrepreneurs we’ve talked about here; Holkins and Krahulik moved to their own website in 1999 and made bad deals for both book publishing rights and their early web presence, almost losing control of their intellectual property altogether. They also weren’t taking advantage of ad revenue, and were running the comic off of reader donations (i.e. going broke) when they met Robert Khoo, their current director of business development.

Khoo met Holkins and Krahulik through some advertising deal and saw right away that these two guys a) had the business acumen of an oyster, but b) were doing something with promise that had an audience. Khoo had so much faith in their project that he drew up a 50-page business proposal and offered to work gratis for two months to help them really get it going. That kind of generosity is unheard of, especially among marketing analysts, and Holkins and Krahulik probably should have been more suspicious of it than they were. Still, they took Khoo up on his offer, and his direction when it came to merchandising, online advertising, and creative services proved to be invaluable.

The comic itself draws from its creators’ deep and varied knowledge of video games and the industry surrounding them, and also from their personalities. Because their commentary is so on-point, they’re sought after by game developers, who are required to send in a game which will only be considered for a kind word (or a custom ad) if Holkins and Krahulik like it. Since they can’t be bought, and because they’re more than willing to trash games and developers who aren’t on the level, the industry takes them pretty seriously. It’s kinda like record labels hoping that Beavis and Butthead like a certain band’s video back in the day (it’s often said that White Zombie’s career took off after ?Thunderkiss ’65? was well-received on the show).

Holkins and Krahulik’s peculiar brand of integrity extends in other directions, too. As a way to direct their huge, loyal readership towards doing some good in the world, and maybe to discourage the stereotype that nerds are materialistic techno-hedonist manchildren, they started a charity called? HYPERLINK “http://www.childsplaycharity.org/”Child’s Play that donates video games, board games, books, and other related entertainments to children’s hospitals. Last year, their donations totaled over $3.5 million.

You’d think, after saturating themselves in video game culture for this long, that they’d see the whole thing as a business and detach somewhat. You’d be wrong. This 2010 G4 interview proves that they’re still as into it as ever. Mike Krahulik and Jerry Holkins are a lot of things, but they’re not poseurs.