Even Epic Games CEO Tim Sweeney admits that a video game company taking over a shopping mall “seemed crazy at first.”
“Somebody on the team had found out it was on the market and raised the topic,” he said.
But that’s exactly what’s happening, as one of the world’s most prominent video game companies prepares for a transformative 87-acre project in Cary, Epic’s home since 1998.
At the end of 2020, Epic closed on what used to be Cary Towne Center in a $95 million deal with Turnbridge Equities and Denali Properties. Inspired by the Pixar headquarters in the Oakland, California, the Epic campus – set to open in its first phase in 2024 — will be a place where Epic can build “without running into future expansion limits,” Sweeney said.
Unlike many CEOs of his stature, Sweeney keeps a low profile. “I’m just some computer nerd nobody knows,” he said.
But people across the world are beginning to take notice. Earlier this year, Forbes estimated his net worth at $7.4 billion, and Epic currently values the company at $28.7 billion. To put that in perspective, Forbes ranks the Dallas Cowboys as the most valuable professional sports team in the U.S. — at $5.7 billion.
And Epic’s surprising purchase of Cary Towne Center sets the stage for more growth.
In fact, as one former colleague notes, Sweeney is always thinking many steps ahead — re-imagining office space; fighting giants such as Apple (Nasdaq: AAPL) over the future of technology; and grabbing land to preserve North Carolina forests for future generations. And that’s why 2021 may go down as the game-changing year for Epic and its quiet, but formidable, 50-year-old founder, Triangle Business Journal’s Business Person of the Year.
READ MORE: Why we chose Sweeney as our 2021 Business Person of the Year
The ambitious vision of building out the headquarters space in the Triangle was not something that occupied Sweeney’s fast-working mind most of the year. It was the culmination of his years-long effort to get some of the biggest names in technology, Apple and Google (Nasdaq: GOOG), to shift their payment processes away from what Sweeney calls anticompetitive – and illegal – behavior.
He fears that, if left to their own devices, Apple and Google’s purported monopolies would stifle other voices. He sees it as a bigger issue, where other companies could join Apple and Google in putting out policies he feels limit entrepreneurship, making it harder to do the very kind of basement tinkering that led to Epic Games.
In 2021, beyond the fight with tech industry stalwarts, and the plan to build its new headquarters, Sweeney was quietly working to preserve one of his favorite things: wooded lands. He has bought hundreds of acres of land across North Carolina for conservation purposes, an activity he said will not end anytime soon.
“The sad truth of it is, in highly developed areas, the cost of land is so high that it’s just not prudent to spend $100,000 an acre conserving an acre in Cary, when that same amount of money can conserve 20 to 100 acres somewhere else,” he said.
Crafting an industry in Cary
Sweeney was thrust into the international spotlight in 2017 when “Fortnite,” now one of the most popular video games on the planet, was released.
He went from quiet coder to an accidental pop culture icon, with his game referenced on “Saturday Night Live” and late-night talk shows.
Sweeney, famously shy of the spotlight, prefers the computer screen, typing his opinions in Reddit forums instead of giving TED-style lectures at business conferences. He rarely speaks with executives outside of Epic, and admits he’s “not been at all plugged into the executive community in North Carolina.” For example, he has had just one meeting with SAS CEO Jim Goodnight, an event dominated by conversations about their shared passion for rock collecting.
Sweeney rarely allows interviews, and those are even more rare during the pandemic – he’s only been to his firm’s Cary headquarters a handful of times since March 2020.
“I’m pretty solitary,” he said. “My life is about ideas rather than people.”
And Sweeney has a lot of ideas – ideas that, thanks to continued investment from firms such as Tencent and Sony, are helping to craft what some are calling the metaverse, a digital iteration of the internet to augment a series of human activity. In simple terms, many believe the metaverse would allow people to experience many wonders of the world, albeit digitally, perform many functions and interact with robots, games and humans seamlessly in a digital world.
In a nondescript yellow sweatshirt, on a rickety wooden picnic table in the autumn woods near Epic’s Cary headquarters, Sweeney talked about growth – the trajectory his company is on and the forces that, if not stopped, he believes could halt the metaverse before it’s realized.
Epic picked Cary as its headquarters in 1998, soon building its own office complex, tucked away in the Crossroads area. It’s surrounded by trees, just a short walk to the bustling retail center – but hard to find unless you know where to look. And that’s how Sweeney likes it – with trails, picnic tables and a basketball court.
Before Cary, the firm that began as Potomac Computer Systems was a “pure virtual company, way before that was cool,” with its founders in places like Maryland (Sweeney) and Ontario (co-founder Mark Rein), recalls former Epic President Mike Capps. Epic’s publisher insisted that the team be in the same place. So they initially followed Rein to Ontario, “suffering” through a winter. The team finished a game but froze in the process, Capps said. So the founders decided to give Cary a try, coaxed to North Carolina by one of its early employees, programmer Steve Polge, who had attended N.C. State University “and knew the area well,” Capps said.
“They picked Raleigh because, at the time, it was a big hub for U.S. Air and because of the college,” he said. “For talent and the housing prices. I think they had a pretty long list of potential places.”
Capps, who had built a game for the U.S. Army, had licensed Epic’s technology. He describes himself as a “vocal complainer” about what he thought Epic was doing wrong with its software.
So when Sweeney and company asked him to move to North Carolina and run the Unreal business, it was a surprise, he said. But the firm made a compelling case. Capps’ last game had 32 million players, but no royalties.
“They said, ‘Hey, come make video games and it will be a little bit of a different story financially,’” he said. So Capps moved to the Triangle, joining what was then a 20-person “eclectic bunch” of kids with green hair and rockstar clothes running a company. He recalls a young Sweeney who could code like a machine, but rarely made eye contact.
“He would stare at his shoes when he was talking to you,” Capps said.
Other colleagues describe Sweeney as “intimidating.”
Canon Pence, the longtime general counsel at Epic, said Sweeney “cares so deeply about the nature of the company” that passions can run high. And while his boss has changed over the years, growing as a leader, that stubborn conviction remains — and to Epic’s benefit.
Pence describes a leader who is extremely hands-on, not about the color of an interface or a particular graphic, but about the overall tone and the long-term relationship with the consumer. He concentrates on the big picture, not arbitrary details, Pence said. He thinks several steps ahead, about how each decision can lead into the next one. And he’s not afraid to say no.
“It might seem necessary that the head of a company of this scale has to stay super high level and removed from the action, but that’s not the case at all,” Pence said. “He’s in the room where the decisions are being made. ... He’s in the thick of it.”
Colleagues repeatedly say they feel “heard.” In a typical meeting, Sweeney listens to ideas, the calculating wheels in his brain turning.
“The best ideas win,” Pence said.
Sweeney, through implementing what some call an “idea-based meritocracy,” has created a real team of believers. Pence, who began by just representing Epic in court, was compelled to go all in on Epic as general counsel, not just for the games it was producing, but for the metaverse Sweeney is trying to build.
“Sometimes as a lawyer you have to support issues or facts or clients that you may not feel great about. ... I felt really fortunate that I get to advocate ... be heard on doing the right thing,” Pence said.
It’s Sweeney’s contagious conviction, colleagues say.
“He’s very direct and very clear,” said company President Adam Sussman.
Tim Sweeney started what would become Epic Games in 1991.
Sussman was lured to Epic from Nike in 2020, attracted to Sweeney’s vision after meeting with him and the rest of the leadership team. For him it was about impact, beyond the gameplay.
Sweeney wanted to take interactivity to the next level, making his metaverse concept a reality. Sweeney was all in, Sussman said, not afraid to “make short-term sacrifices to get to the right answer in the future.” That “refreshing” focus had Sussman wanting to be all in, too.
“I felt my whole career was building up to this career with Epic,” Sussman said.
Both Pence and Sussman describe a fast-paced culture that rewards ideas. Instead of publicly calling out his employees, Sweeney prefers one-on-one praise. It doesn’t happen every day, but when Sweeney does give a compliment, it means something, Pence said.
The culture Sweeney crafted in Cary — and Pence said Sweeney was extremely intentional about crafting it — was so addictive it had a multiplier effect on the ecosystem.
When Capps retired in 2012 after liquidating shares as part of Tencent’s investment, he created his next startup in the region, Diveplane. Acclaimed video game designer Cliff Bleszinski, who also left the company in 2012, made a similar move, creating his own video game company and investing in a slew of local restaurants. Epic veteran Matthew Schembari founded Lightforge Games in Raleigh; Josh Fairhurst, also formerly of Epic, co-founded Limited Run Games and the Mighty Rabbit – and the list goes on.
Epic, led by Sweeney, had created a movement in the region – one that couldn’t be contained by the walls of its headquarters.
All these years later, Sweeney definitely doesn’t stare at shoes. Backed by years of validation – including billions in venture capital dollars – Sweeney has developed a sense of confidence in what Epic does, evidenced by how passionately he talks about the company’s growth.
Much of the growth happened suddenly. That group of kids with wild hair has grown to more than 3,200 people. Sweeney, always 10 steps ahead, sees it continuing – and hence the mall move.
Staying on its current acreage would require “compromises,” he said, including an underground parking garage and paving over some of the wooded areas.
“It didn’t really lead to a great quality of life situation,” he said. Sweeney envisions a place where people can collaborate across time zones. And his team is currently evaluating what that might translate to as far as the design of the new headquarters in a post-pandemic world.
“Epic is a very collaborative company. … We don’t have a bunch of different divisions,” he said. “We’re not like General Electric. We are one company with one vision.”
And big dollars are backing that vision.
In April, Epic confirmed another $1 billion “strategic investment,” led by tech firm Sony. The news followed a $1.8 billion raise in 2020, a $1.3 billion funder in 2018 and a $330 million deal in 2012 that included a 40 percent stake by Tencent Holdings.
Sweeney, who still holds control of the company, insists Tencent has never “attempt[ed] to influence Epic’s policy based on China concerns.”
He said that, at Epic, simplicity is key – which is why, though “it’s always a possibility,” he does not foresee an IPO in the next few years.
“We always try to keep Epic simple and, at some point in the future, being a public company might be simpler than being a private company,” Sweeney said.
What’s not simple, however, is the conflict the firm finds itself in in federal court.
Sweeney versus Cook
Sweeney uses an Apple iPhone.
“I’m a heretic, right?” he said. “I adhere to the faith, but I question the orthodoxy.”
That orthodoxy is the subject of ongoing litigation between Epic and Apple and Google – lawsuits that have made global headlines.
Of course, while all this was going on in court filings, Sweeney is also quick to point out his first and only email in 2015 to Apple CEO Tim Cook was never answered.
Sweeney recognizes the enormity of targeting two of the biggest companies in the world. But he implies he had no choice but to fight, both for the little guy and in defense of the universe firms like Epic are trying to help build: an interactive internet-driven social reality.
“Science-fiction writers call it the metaverse,” he said.
And behemoths such as Apple and Google, who he said have built monopoly stores and payment systems, are threatening that future.
“If Apple doesn’t want the metaverse to exist, Apple can simply crush it by instituting policies that don’t let anybody else build one, except for themselves, and that has to be stopped,” Sweeney said. “For a long time, Apple was taxing the mobile economy unfairly. That’s continuing … but it’s about to reach a much more insidious level, where they are actually transforming the future of humanity in a very negative way, which puts two companies in absolute control of the consumer computing experience.”
“It has to be stopped,” he repeats with conviction.
Sweeney is a clear history buff. The last movie he saw was “The Last of the Mohicans,” the 1992 movie whose scenes were shot a few miles from land he purchased for conservation in western North Carolina. The comparisons he uses to enhance his arguments about tech monopolies, too, show a careful attention to historic facts. He compares the situation with Apple and Google to what happened in the early days of railroads. Railroad monopolies had the power to set prices and exclude competitors, a practice the Interstate Commerce Act stopped in 1887.
Apple and Google may not be sending locomotives down tracks, but they are controlling how their metaphorical railroad is accessed in a way Sweeney finds scary.
“The railroad builder has the right to operate their business and to make a profit, but what they do not have the right to do is use their monopoly in the transportation business to impose monopolies on other businesses by limiting the ability of others to access the railroads,” he said. Sweeney claims Apple, as a hardware firm, can compete with hardware providers “but Apple cannot use its monopoly over the iOS hardware in order to impose a monopoly over stores.”
Sweeney’s rise
Sweeney began his own coding obsession at the age of 9, tinkering on an Apple II computer, He taught himself how to program with the help of online bulletin boards and old-fashioned trial and error. He mowed lawns to pay for hardware. He developed his first game, “ZZT,” by using a text editor.
In 1991, Sweeney, then a 21-year-old soon-to-be college dropout (he finished his mechanical engineering degree only a few years ago), started what would become Epic at his parents’ house in Potomac, Maryland.
Through computers, he found his voice.
If the lawsuits fail, Apple and Google will dictate “not just prices, but also policies to everybody, then they will control everybody’s online lives in minute detail in the future,” Sweeney said, painting a version of dystopia that he’s used to incense his followers in past tweets and Reddit posts.
Apple, Sweeney insists, “has nothing to do with ‘Fortnite’s success.”
Sweeney said it was already a successful game on PC, Xbox and PlayStation, and that at the peak of Fortnite’s dominance iOS accounted for just 10 percent of the active player base.
He just wants coders to have the same opportunities he had, Sweeney said – something he said is impossible unless big hardware firms back off.
Sweeney is in his zone when talking about the metaverse and its threats, but it’s clear he’d rather be coding. Sweeney is a thinker, not a talker, and isn’t afraid to admit it.
He points to “Fortnite,” saying it’s the game, not him individually, that’s the sensation.
A passion for conservation
When he’s not coding, he’s often immersed in his side project: investing in land and working to turn it over to conservation entities. In October, for example, his conservation LLC purchased nearly 295 acres south of Siler City for more than $1.7 million, part of a nature conservation project focused on the Rocky River and Bennett Flatwoods. Sweeney, who grew up surrounded by woods in Maryland, has made similar buys in western North Carolina.
Site of Sweeney's land buy near Siler City in October.
In September, Sweeney acquired a separate 270 acres in Chatham County.
Sweeney said he remembers watching the woods in his hometown get paved over to make way for “mansions and McMansions and everything of the sort.”
“I actually moved to North Carolina to escape the crowding of the town I grew up in,” he said, noting he saw “the same thing was starting to happen here.”
So Sweeney started to collect acreage, creating what he calls a “conservation corridor.” The goal is to mirror park plans in the Northeast, where parks are collected into massive corridors that link multiple conservation areas together.
“North Carolina kind of lacks that,” he said, adding that he’s trying “to connect areas where there’s really nice conservation land that’s ready to be linked up through forest.”
In western North Carolina, that means connecting protected wooded areas such as Pisgah National Forest and Chimney Rock.
And it’s required an opportunistic approach. During the last real estate implosion, when investment groups were looking for an out, he pounced.
“There [was] an opportunity to put together just an amount of land that wouldn’t be possible in normal economic times,” he said.
READ MORE: 13 Questions with Epic Games CEO Tim Sweeney
Sweeney works with foresters to source deals, people with connections to the land going back generations, he said. And Sweeney finds his money goes further in western North Carolina, which is why that’s where much of his conservation efforts are focused.
He takes the same tactical approach with everything – from the business he started when he was 20 to the litigation to his conservation mission. While longtime colleagues say he’s changed – developing a strong business acumen and a confidence that that shy kid coding at his parents’ house lacked — Sweeney insists he’s still the same guy.
“I haven’t really changed in my way of approaching [Epic] that much,” he said. “I’m still the same person. It’s amazing how much it’s evolved. ... It went from being a really small, little industry where I released my first game, and as a mail order product. … We’d get two or three orders a day and I was like, ‘Wow, we’re rich.’”
The $60 a day was an incredible rush back then, as Sweeney copied floppy disk after floppy disk and mailed them directly to customers. Today there are billions of gamers, and the industry has evolved to multiple platforms and genres. And many of those developers are using the Unreal Engine development platform Epic Games invented.
“It’s really impressive how it’s come about,” he said.
A big part of that industry transformation was driven by Epic, which changed the game with Fortnite, attracting casual gamers, the so-called “noobs” titles like “Gears of War” and “Call of Duty” had been unlikely to grab.
“It’s guns and blood and really, really hardcore war experience,” Sweeney said of “Call of Duty.” “Whereas ‘Fortnite’ was zany. Even though it’s a shooter game, it’s just always fun and whimsical and not too serious. ... We saw a huge set of people who weren’t traditional gamers come in.”
Over the years, Epic has proven its model “wasn’t just a fluke, it wasn’t just a fad.”
Games like “Minecraft,” “Roblox” and “Fortnite” are proving a widely accessible social entertainment experience has a major place in the industry.
One thing that might surprise people about Sweeney is that he doesn’t actually describe himself as “much of a gamer.”
“But I’ve played thousands of hours of ‘Fortnite,’” he said.
In Cary, the industry has exploded. Capps said it was gradual at first, Red Storm Entertainment (now owned by Ubisoft), spinning out of the computer science department at UNC-Chapel Hill. Epic came soon after, and the talent the two would attract would spin out to create even more companies.
Sweeney has no regrets about any of it.
“I think that things have worked out pretty well for me,” he said.
