Magic Man
Richard Garfield invented a card game that has earned him millions of dollars, and created a fantasy career for himself.
By David Kushner

(FORTUNE Small Business) – Every day Richard Garfield, a 40-year-old father of two, stays in his Seattle home and plays with his games. Some days he'll try out his wizard and warrior trading cards. Other days he'll race some frogs. For Garfield, that's the kind of work that pays off. Thirteen years ago, while completing his Ph.D. in combinational mathematics at the University of Pennsylvania, Garfield created a fantasy-theme trading-card game called Magic: The Gathering. The game, which cost less than $100,000 to bring to market in 1993, has gone on to earn Garfield more than $125 million.

The magic of Magic is this: In the game, players trump one another with cards that represent different creatures or spells. The more spells you have to choose from, the better you can compete. And to get more spells, you have to buy more decks of Magic cards—each deck costs between $3 and $10. "I get excited about new revenue models," Garfield says.

He's not the only one. Shortly after he published Magic, Garfield merged his sole proprietorship, Garfield Games, with a Seattle-based publisher, Wizards of the Coast, in exchange for 25% of the company's stock. In addition, Garfield received an annual salary that grew to $250,000 over seven years. In 2000 toy giant Hasbro purchased Wizards—which also published hit fantasy games such as Pokémon and Dungeons & Dragons—for $450 million. Garfield got more than $100 million. "It was a good year," he says.

Today Garfield draws a $75,000 salary as a consultant for Hasbro on Magic: The Gathering. He also works for other game publishers, which pay him to develop new products—advances can run as high as $200,000, plus a 5% to 30% royalty. (The first of the games should be out by year's end.) In 2003 his income from advances reached about $200,000.

A guy with a $100 million windfall can afford to invest a little in his business. But Garfield probably wouldn't be able to find a way to spend that kind of money if he had to; his expenses are minimal. For each contract he spends about $3,000 in legal fees. While working on his new games, Garfield enlists the help of friends who are programmers or artists. In exchange, he gives them a royalty of as much as 50%, depending on their involvement.

These days Garfield is busy refining a Magic-like revenue model for some online games he's creating for Microsoft. One idea, he says, is to encourage players to shell out cash for different collectible items—like weapons or shields—to use during the various games. "One game is reminiscent of Battleship," he says. "In another, you're racing frogs."

The frogs aren't magic, but given Garfield's record, you can bet the games will be.


Most of Richard Garfield's income came at once—a $100 million windfall in 2000. But with a low-overhead business like his, why stop working?