When an article has this line in the first page:

This is the story of how two douches from Spokane, Washington, became the most powerful players in the videogame industry.

You know it’s gonna be good. Wired recently spent a week or so in the Penny Arcade offices and came out with a pretty interesting read about Gabe and Tycho’s real-life alter egos.

Holkins and Krahulik were booking their own ads and charging “about 98 percent less than they should have been,” Khoo says. They had signed away book publishing rights to a guy who moved to Alaska and refused to pay them. They hooked up with a dubious Net company and nearly lost the rights to their intellectual property and the name Penny Arcade. When Khoo met them, they were living off donations from readers and contemplating the prospect of day jobs again. “Jerry and I are good at making comics and being funny… and that’s it,” Krahulik concedes.

Khoo coaxed them into a second meeting and presented them with a 50-page business plan. He offered to quit his analyst job and work for them free for two months. “They should not have trusted me,” he says.

They did. Holkins looks back in astonishment at what easy prey they would’ve been for an unscrupulous person looking to get their hands on the business. “Luckily, Robert perceived greater value in fixing us to the front of his chariot and riding us forever,” he says.

Khoo has created a successful business model that includes merchandising, creative services, and book publishing (they’ve recovered the rights). But the centerpiece is online advertising. A bell rings in the office, signaling that the Penny Arcade sales department has just closed another deal on a banner ad from a game publisher. As with every ad that appears on the site, the potential advertiser first had to send over a copy of the game, and Holkins and Krahulik had to deem it worthy. “There were fights about that at first. We’d swat down a $20K buy that Robert had spent weeks working on,” Holkins says. “But he quickly realized that our choosiness helps him.”

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