Hall of Fame – 1 Million Gold Cap Club: Drakkmur of Hydraxis-US

The Warcraft Econ Hall of Fame interviews the few elite players that have hit the World of Warcraft gold cap of 999,999 gold 99 silver 99 copper as well as ones who have obtain 500k and 250k. We have with us, Drakkmur of Hydraxis-US, who will be sharing their story with us today.

Please tell us a little about yourself and your gaming experience.

My main character is Drakkmur, a feral kitty, on US-Hydraxis.  I never really considered myself a gamer.  I played video games casually when younger, typically sports games like NHL Hockey 95 or the John Madden series.  However, I always enjoyed role playing games.  I played D&D when in high school and loved the Baldur’s Gate series.  A friend of mine eventually got me to try WoW at the beginning of WotLK (yes, I am a Wrath baby) and I have been hooked since.

I have a Bachelor of Science in Finance from Penn State University.  I use many of the real world economic ideas I learned in college to make gold in WoW.  Today, I am the co-host of a WoW related podcast, Warcraft Lounge, that prominently discusses gold making tips along with other topics.

Do you raid or PvP most? Both? How do you enjoy the game?

Most of my time is spent raiding.  I will occasionally pvp, usually only to grab an item that is useful in PvE or to break up the monotony of leveling a new toon.  I have been in a top 100 world guild and got a top 100 US kill of heroic 25 Halion and a top 175 US kill of heroic 25 LK.  I currently raid on an Elemental Shaman in a casual 10 man guild on Hydraxis.

Besides raiding, I enjoy making gold in the game and playing several alts. I currently have 4 toons at level 85 and 4 others that are level 80+.

Why did you choose to collect this amount of gold?

Honestly, it wasn’t one thing.  At first, I made gold simply to have the materials I needed to raid.  Eventually, I realized how easy it was to make gold and did it almost out of habit.  At one point, I was probably spending 5-6 hours a day working the AH.  Today, I may only spend 30-45 minutes a day on average while still making thousands of gold a day profit.

How did you go about getting to the gold cap? Any creative or original ideas?

Early Days: The first way I made gold in game was by farming herbs during the inscription boom at the beginning of Wrath.  I had a path laid out where I started in the Hinterlands and ended in Stranglethorn.  I remember bragging about how I made 300-400g an hour doing this (this becomes comical as you read below).  The thing that got me “hooked” on gold making though was when I realized my enchanter could buy cheap green items on the AH, DE them, and sell the mats for significantly more than the price I paid for the item.  I would spend hours scouring the AH for deals and then DEing the items.

An Empire is Born: I made a fair bit of gold via herbing and DEing items and sat at around 5-10k gold, which was a respectable number during Ulduar times.  At this point, I leveled my 3^rd and 4^th toons, a pally that was a JC/Alch and a shaman that was a Scribe/LWer.  These toons combined with my feral, a BS/Alch, and my warlock, a Tailor/Enchanter, gave me every crafting profession except an engineer. I started selling gems like crazy.  I found auction mods that made my life easier/more efficient and began also selling glyphs.  Combined with items from BSing, Tailoring, and LWing, I started selling 10-20k gold worth of items a day in the AH. In no time, I went from 10-20k gold to having 100k and then 200k, all the way up to 700k+ at the beginning of Cata.  At one point, I estimate that 70% or more of the gems bought on Hydraxis were bought from me…I completely dominated that market.  When I server transferred my feral to US-Shandris to join a raiding guild there, I brought my “eco-system” of crafters with me while keeping another group of similar crafters on Hydraxis.  This allowed me to work two different AHs at the same time, effectively doubling my profit.

Maintaining the Empire: I no longer spend the time I once did in the AH.  Today, I am all about making gold efficiently.  I may only spend 30-45 minutes a day in the AH, but I spend my time doing activities that make me the most gold per hour, a concept I will discuss in more detail in the “gold making class” section.  I have also largely withdrawn from the Shandris AH, focusing only on Hydraxis, although I recently got more active on it for my final push to one million gold.

What is your master list?

Cut rare gems, uncut uncommon gems, Ebonsteel Belt Buckles, spellthreads, crafted cloth belts, glyphs, volatiles, cloth, Darkmoon cards/completed decks, cut and uncut shadowspirit gems, leg armors, and pristine hides.

What items are in your Snatch list?

Any manner of volatiles, elementium and obsidium ore, pyrite and elementium bars, Cata herbs, savage leather and savage leather scraps.

How did you learn to do it? Anyone or resource you would like to thank?

I am mostly self taught.  As I said above, I have a degree in Finance and enjoy “exploiting” the economy of WoW.  As I learned more about the game, I was able to apply those real world ideas to a virtual world to make a fortune.  I guess the resource I should thank the most is Google.  Whenever I had an idea or came across a problem while trying to make gold, I would Google it and often would be sent to some obscure forum post or website that would have the solution I needed.

What addons, if any, do you use to help you make gold and why are they needed?

Here is what will change your gold making world forever.  The Holy Trinity of gold making addons: Tradeskill Master, Auctionator, and Postal.

Tradeskill Master (formerly Quick Auctions and Auction Profit Master) is the most incredible AH addon ever.  It allows you to automatically post hundreds of items in the blink of an eye…all for a profit.  This allows you to post the 200-300+ glyphs and 60-80+ gems needed to make serious gold with a JC or a scribe.  Been undercut by a competitor, have no fear.  TSM can automatically cancel any auctions you have been undercut on so you can repost them and re-undercut your competitors.  It also allows you to automatically restock your inventory.  Did you sell 3 delicate inferno rubies?  It’s ok, TSM will identify that you have none in your inventory or in the AH and will have your JC cut some for you (along with any other gems you no longer have in your inventory.  The addon requires some time to configure, but the 30-45 minutes you put into the set up will save you hours and make you hundreds of thousands of gold in the process.  This thing is a requirement for any serious gold maker.

Auctionator is a nice mod that allows you to post one off items quickly, check prices, and buy materials.  Let’s say you want to buy volatile life for you alchemy transmute.  You type in volatile life and it will show you all of them on the AH with their price per unit and how many come in a stack.  So if the guy selling a 100 in a stack is cheaper than the guy selling 5 in a stack, you will know it quickly and buy the cheapest stuff.  It also remembers what you have bought so it will auto-fillin your commonly searched items.  You can also simply type “volatile” and any item in the AH with that word in it will come up so you can quickly compare the prices of all 4 volatile elements.

Postal is a mailbox mod that automatically retrieves your mail with the push of a button.  This is mandatory if you want to start posting hundreds of auctions at a time like I do.

Are you still going for more gold?  If so, do you have a new goal? Are you close?

I honestly don’t know.  One million gold was my major goal because I wanted to be able to say I was a wow millionaire.  I will probably continue to post auctions very casually, focusing on my highest gold per time spent items.  However, I think my days of posting 100k of items at a time (which recently happened) is over.

Do many people know you have this amount of gold?

Pretty much everyone in my guild on Shandris and Hydraxis know.  Anyone that listens to my podcast at Warcraft Lounge also knows.

Did you spend your gold on fun things? What have you bought? What things would you like to buy?

I am not really into vanity items in game so I don’t collect pets, or recipes, or mounts.  That said, I donated 50k gold to my guild to get a Mimiron Head and when I recently server transferred I bought a Vial of the Sands to transfer some of the wealth and decided to give it to my Shaman since his flying mount was terrible.

The thing I splurge the most for is gear as I am an altoholic.  I can buy whatever I want without consideration of price.  I have changed mains already 4 times this xpac and to gear each of them up quickly, I have bought each of them a ton of items.  My feral, who was my main coming into this xpac, got about 150k of equipment bought from him in the first two weeks of the xpac.  More recently, I switched to my shaman and had several items crafted and/or bought for him.  Across my 4 level 85s, I have 4 Darkmoon trinkets, including a Tsunami deck for my shaman’s offset.

Lastly, I sometimes (although admittedly rarely) splurge on friends.  I bought a Vial of the Sands for a friend on Shandris and recently a friend of mine came back to the game and I bought him several epics to start him off on the right foot.

If you were the professor of a gold making 101 college class, what would be some things you would talk about?

If I taught a 90 day introductory WoW gold making class, days 1-89 would be spent convincing my students to stop farming.  It seems that most of the player base believes that farming (mining, herbing, skinning, or in some cases completing dailies) is the best way to make gold.  Not only is it not the best, it might actually be the worst.  How so?

1. Ask yourself do you know any real life farmer that are wealthy. The answer is no and unless you have entirely too much time on your hands the same holds true for WoW.
2. Farming is a declining activity throughout an xpac. Sure, I agree you can make a lot of gold like the first 3-4 weeks of an xpac farming materials. However, isn’t that the time you really want to be spending your time experiencing the new content out and not farming for gold? Additionally, after those first couple weeks you still have ~18 month left in an xpac and that entire time the sale price of everything you farm continues to drop meaning that for the same amount of items/time spent farming a month ago, you are making less gold today.
3. Farming is not scalable. There is nothing really you can do to improve the efficiency of your farming. If you gather 20 stacks of herbs today in a half an hour, in a year you will still gather 20 stacks of herbs in a half an hour. The only difference is that your 20 stacks of herbs in a year will be worth less.
4. Farming is boring, mind numbing, and requires your active participation to be making gold.  You have to pay attention while farming.  You can’t really walk away from your computer while farming or even pay attention to a TV.  You just sit there, going from node to node experiencing either boredom or anger towards the farmer that beat you to your last node.  People say all the time that WoW is “just a game” and that games are supposed to be fun.  Does farming sound fun to you?

So what would I then do on day 90 of the class?  Tell you that exploiting the AH is the way to make real money in WoW and to come back next semester to my advanced course where I tell you how to do that. We’d also cut class early and head to a bar to celebrate you all passing.  Congrats!

How about an advanced gold making class?

Congrats on making the advanced placement class.  Put on your thinking caps, this is about to get fun.

1. Lesson One: The Auction House is Your Pot of Gold.  Leverage your crafting professions and gold literally falls into your lap.  What makes the AH so great is that it is everything farming is not: scalable, does not require active participation, is typically more profitable over time, and is fun! It is scalable due to the usage of the mods I mentioned above.  The extra time needed to post 300 auctions vs. 50 is negligible. Once you figure out how to use TSM, you will easily be able to post thousands of auctions a day (if you choose to commit that much time to making gold). It doesn’t require active participation.  I can log on and post 300 auctions in less than 5 minutes.  I can then log off and go out with friends for the night. When I come home and log back on, I will have thousands of gold in my mailbox waiting for me. Sure, there is some prep time required but as I explain in a little bit it is still significantly more efficient than farming.  You will also make more gold as time goes on.  Whereas farming mats get cheaper later into an xpac, later in an xpac more characters are max level.  That means more people buying gems, glyphs, leg armors/spellthreads, belt buckles, etc.  As time goes on, you will have more JC cuts via the JC daily, allowing you to make more gold. Lastly, making gold in the AH is fun!  You realize very quickly there are about 10 other people like you that post auctions seriously on your server.  Making gold becomes a form of “economic PvP”.  You are competing against the other people trying to “win” the AH.
2. Lesson Two: Opportunity Cost and Gold per Hour.  Opportunity Cost is an economic principle that states the value of any good/activity is the value of the next best option available to you.  For example, if you have a quart of milk and plan to use it for a bowl of cereal, possible opportunity costs would include: using the milk for milk and cookies, using it to make mac & cheese, using it in your coffee, using it in a recipe, etc.  Another reason why farming is bad is because people do not understand opportunity cost.  They believe that any materials they farm are “free” and therefore pure profit.  This is not true.  The materials cost you time, which is a resource the same as any other. So the first opportunity cost associated with farming is what could you have done with the time spent farming.  While you have literally hundreds of options, the primary thing you could have done instead is spent that time crafting goods and selling them in the AH.  I did some experimenting on US-Hydraxis testing gold made per hour spent mining, herbing, and in the AH.  While not scientific, mining made about 1k gold per hour (note all pricing data in this interview was done just before 4.0.6, prices have changed since then) and herbing made around 1.6k gold per hour spent. Meanwhile, I made roughly 10k gold per hour crafting goods and selling them in the AH, or approximately 6-10x more gold per hour than herbing and mining.
3. Lesson Three: Opportunity Cost and Selling Goods for a Profit. Another implication of opportunity cost is that you have other options for your mats.  If you herb, you can use those herbs to: make flasks and other alchemy items, make glyphs and other inscription items, or sell them directly into the market as is.  All too many times I see people selling flasks for 150g and when I go to the AH to see how much the herbs needed to make that flask cost, the herbs on the AH are selling for a total of 200g.  You are giving up 50g by making that flask and selling it at 150g instead of simply selling the herbs as is and making 200g.  However, farmers do this all too often because in their minds it is all “pure profit”.  If you listen to my advice, you will be buying 100% of your mats from the AH.  Make sure you are using them for their highest, best use and you are only selling items that net you a profit.  Even if it means not undercutting a competitor that is selling the item for too low and letting them “win”.  In fact in some cases, I will buy out my competitors’ items and re-post them at a higher price.  Just be careful about doing this unless you really know the market.
4. Lesson Four: The Value Chain.  This is why I have one of each crafting profession.  Most professions have items that “feed” other professions with alchemy being the ultimate feeder profession.  Take advantage of your professions to create value along the chain.  For example, recently I was buying obsidium and elementium ore for about 60g per stack.  I would prospect these items with my JC.  What you get via prospecting may have some randomness for each attempt but if you prospect 100 stacks of ore, you will be able to fairly accurately predict what you will receive.  This info is on the Internet and in the case of obsidium ore you get roughly 6 uncommon gems and 0.5 of a rare gem per stack while with elementium ore you get 5 uncommon gems and 1 rare gem per stack.  This allows you to calculate the value of each stack of ore based on the prices of the gems.  In my case, I estimated the sale price of those gems to be roughly 90g per stack meaning that each stack of ore (that someone else was good enough to farm for me) netted me 30g profit per stack.  I timed it and I could prospect about 4 stacks per minute meaning I was making roughly 7k gold per hour via prospecting this ore.  However, what I discovered was that I could create additional value by taking my uncommon gems and giving them to my transmute master alchemist to transmute shadowspirit diamonds (which has no CD).  Additionally, instead of simply selling my uncut rare gems, I could use them to feed my JC who would cut them and sell them for a higher price than the uncut gems.  Overall, this process netted me well over 10k gold per hour of time spent.
5. Lesson Five: Arbitrage. Arbitrage is the exploitation of pricing discrepancies in two different markets to make guaranteed profits.  A real world example would be buying gold for $1,000/ounce on a NY exchange and then simultaneously selling that gold on a London exchange for $1,100/ounce. In the real world, there are millions of participates in those markets so opportunities like this are rare and disappear quickly (in this example, the price of gold in the NY exchange would rise and the price in the London exchange would fall until the two became nearly identical).  However, most servers only have 10-30k people on them and most of them could care less what happens in the AH so arbitrage opportunities exist.  Just before 4.0.6 went live, I was buying savage leather scraps for about 1g each.  Five of these can be turned into a savage leather if you have a leatherworker.  Savage leather goes for about 6g each so if you wanted to, you could sell the savage leather and make a profit.  However, not only do I not sell but I buy the savage leather at 6g each.  I turn my savage leather into heavy savage leather.  This requires 5 savage leather and means that my cost per heavy savage leather is either 25g (via the scraps I bought at 1g each) or 30g (via the leather I bought on the ah for 6g each).  You can then go to the LWing vendor in Twilight Highlands and buy pristine hide for 10 heavy savage leather each.  That means my cost per pristine hide is between 250-300g.  Pristine hide is selling for 500-550g on my server meaning that I am making 200-250g per hide without having to farm a scrap of leather.  Not only am I selling the hides directly, but because my mats costs are so low I will also sell the LWing leg armors, which because my costs of goods is lower than my competitors, I can often undercut without fear of being re-undercut.
6. Lesson Six: How to Post and Undercut.  So you have all of your items, you have your auction house mods, and you are ready to sell.  But how do you actually go about doing it?  First, post all auctions for 12 hours only.  The longer you post, the higher your deposit costs are so if you cancel your auctions it costs you more gold.  The reality is that for most items, if you don’t sell them within 2 hours, you probably will never sell them because they have already been undercut.  So just post for 12 hours and save yourself gold when you cancel auctions.  Additionally, only post a couple of each item.  I like to post only 2 of each gem cut I have at a time because it makes cancelling auctions cheaper and I know it is pretty rare for me to sell 3-4 of the same cut before someone undercuts me.  For some items it will be ok to post 4 or even 5 of the item.  You will figure this out with experience.  Also, pay attention to prices when undercutting.  Sure if you use TSM, it will automatically undercut for you and you probably won’t be paying attention but there are some items I still prefer to post manually.  In those situations, be smart about undercutting.  If you have 20 volatile air and there is currently 1 volatile air on the market for 20g and then the next cheapest is being posted at 26g and there are 50 of them…don’t undercut the 1 VA at 20g.  That one will sell.  Instead undercut the 50 VA that are being posted at 26g.  That will net you 6g more per item or 120g more!
7. Lesson Seven: Don’t Give Your Customer a Reason to Buy from Someone Else.  I see this all the time, I am sure you have too.  Let’s say glyphs typically sell for 100g on your server.  You know that and most everyone else does too.  But the main glyph seller on the AH maybe is away and hasn’t posted in a couple days.  As a result, glyph of Immolate is not on the AH.  You have a scribe that can make that glyph…how much do you sell it for?  All too often, I see someone try to sell that glyph for 600g.  Seriously?  There is nothing special about your glyph, it is exactly the same as every other scribes glyph.  Any remotely intelligent person is going to look at that price and laugh.  More importantly, they are going to look for alternatives to buying your glyph.  Maybe they ask in trade chat, maybe they ask a guildie, maybe they just wait until tomorrow.  In any case, you just lost a sale because they would rather buy the mats off the AH for 50g and tip a scribe in trade chat 50g than pay you 600g.  So be smart, you can squeeze the consumer a bit in this situation but not for 600g.  If glyphs typically go for 100g on your server, post 2 of them for 150-175g each.  People are lazy and they want immediate satisfaction.  They will probably bitch to someone about paying that much but they will buy it rather than have to find someone to make it for them.  So be smart about your posting prices.
8. Lesson Eight: Inventory Management.  Once you really become a player on the AH you will have tens of thousands of gold in inventory.  It is important to know how much you have and which toons have the stuff.  I use an addon called altoholic to track this.  It allows you to hover your mouse over an item and see how many you have and which toons have the items.  Since you are not farming, your entire inventory comes from the AH.  As a result, you will become very familiar with the price of your primary mats.  Don’t be afraid to buy in bulk if you know a price is good.  I recently bought about 1,400 Twilight Jasmine from the AH at 100g per stack, roughly 50% of the true value of the herbs.  I ended up selling all of those herbs for 2x my cost meaning that I made exactly the same profit as the farmer that probably spent hours farming those herbs…I spent maybe 10 minutes in the AH selling them.
9. Lesson Nine: Use Your CDs.  Profession cooldowns are the easiest ways to make gold in this game.  For most of this xpac, the alchemy CD was worth about 250-300g a day if you used the Living Elements transmute to make volatile air.  However, many people sell their CDs for a measly 100g or worse…don’t use it at all!  Make sure you are using profitable CDs like the alchemy ones, some of the dreamcloth CDs, and doing things like the JC daily, which even if you don’t want to sell gems you can buy a Chimera Eye and sell that for a very nice profit.
10. 10.  Lesson Ten: Enjoy Your Wealth!  You can’t take the gold with you when you quit the game.  Make sure you are spending it on the things you enjoy.  Maybe it is pets, maybe it is mounts, or maybe you are like me and you enjoy gearing your toons.  Just make sure all this work is being done for some benefit at the end.

Do you have good farming strategies or spots?

My farming strategy is don’t farm.  It is a waste of time.  See my Gold Making 101 discussion above for details.

What was the best deal you ever came across?

The Twilight Jasmine example above was a sweet deal.  I once bought about 300 titansteel bars for about 50g each.  I took them with me to a new server and sold them for on average 110g each.  On my shaman (who was main spec resto at the time) I bought a Solace of the Fallen in a TOC pug for 6k gold.  The guy I bought it from thought I was kidding.  I still was using that trinket for my first couple Cata heroics until I splurged and gave him a Tsunami deck for his offspec.

Do you remember any of your worst deals?

When patch 4.0.1 came out I thought epic gem CDs were being taken out of the game.  I bought enough mats to transmute hundreds of epic gems.  The first day of the patch I was selling my cut gems at prices as if I had an unlimited supply of cheap gems.  Unfortunately, I was wrong…the CD was still in the game and I spent the next month and a half slowly unwinding those mats back into the AH for a slight haircut on my original cost.  Not only that, but I blew through my inventory of epic gems by selling them too low and watched as my competitors were making a fortune selling cut gems, while I had a difficult time finding any uncut gems on the AH to compete with them.

What are your future plans with WoW?

I am loving raiding casually with the 10 man guild I am with atm.  My co-host and I are getting more serious about our podcast and have been spending a lot of time improving the quality of the show and trying to reach a large audience.  I have played Horde only up until this point.  I plan to begin leveling a handful of Alliance toons on US-Whisperwind soon.

I know eventually I will quit the game, but I doubt that will happen this xpac.

What are you predictions for the future WoW economy?

Maelstrom crystals will plummet in price once 4.1 hits due to epic items dropping from the new 5 mans.  Make sure you don’t have any in your inventory and if you sell things like Power Torrent scrolls, make sure you sell all of them going into the patch.  When epic gems come out, their prices will be crazy and the value of pyrium ore will skyrocket.  Stockpile both the ore and JC tokens to allow yourself to buy as many patterns as possible on day 1 and cash in on the rush.  Remember the lessons taught from this xpac.  Mats and goods in general are expensive as hell the first month.  The last 2-3 months of this xpac when the game gets stale, spend your extra time hording gold so you can go into the next xpac without being concerned with gold.

Please tell us a little bit about how you handle your real life finances. What are the differences and similarities with how you do things in WoW?

As I said in the intro, I have a finance degree and I am very meticulous with my real world finances.  I invest heavily in the stock market (my version of the WoW AH) and have a flawless credit history.  Trust me; a bad credit score makes your life hell.  If you are a young person in high school or college do yourself a favor and whatever it takes pay your bills on time.  The one major difference between my personal finances and my WoW finances is I feel I am more entrepreneurial in game.  I don’t ever see myself owning my own business in the real world but in game I basically run my own corporation.

Thank you for taking the time to do this interview for Warcraft Econ. Do you have any last words?

People often ask me what I think the most profitable professions are.  In order they are:

1. Jewelcrafting: There is no better profession in the game for efficiently making tons of gold in game
2. Alchemy: Alchemy is the feeder profession of WoW.  Transmutes are an amazing way to make gold with little or no effort.  Flasks are sometimes profitable too, but I often find people sell them below the cost of mats.  Don’t forget the value of double duration flasks too.  If you raid a lot, that will save you hundreds of gold per week in flasks alone. JC and Alch are easily my favorite professions.
3. Inscription: Inscription is very labor intensive.  Milling herbs blows and then turning pigments into inks is like twisting a dagger in your back.  To make serious gold, you have to post and cancel thousands of auctions a day.  The market can be very competitive and if you don’t have a mod like tradeskill master, you have zero chance of competing.  All this said, no other profession has the profit ceiling that inscription does.  If you own the glyph market, you can make ridiculous amounts of gold.  I was friends with the guy that owned the glyph market on Hydraxis when 4.0.1 came and glyphs become permanent.  He claims he made over 200k the first week of that patch.  Just realize that to make that kind of gold, you are going to spend a lot of time milling herbs, making glyphs, posting glyphs, cancelling glyphs, and camping the AH to keep competitors away.
4. BS/LW/Tailoring: All these are roughly equal.  I prefer to sell items people use over and over again and therefore I tend to avoid crafted items like belts, shields, and chests and focus more on item enhancements like belt buckles, leg armors, and spellthreads.  Individually, these professions won’t make you rich but when combined with all three and also with the three listed above, you can make a lot of gold.
5. Enchanting: You can make some serious gold from DEing cheap greens in the AH…that was really my first way of making gold in this game from one of my crafting professions.  I have heard people say they make gold with scrolls but I have never had much luck there.  A lot of the value from enchanting comes from DEing quest rewards and the convenience of being able to do your own enchants.
6. Engineering: I don’t think I have ever made any gold with Engineering.  Maybe it is because I don’t have a hunter so I never really looked into making scopes but effectively have ignored this profession as a gold maker.

If you liked this interview, please check out my podcast at www.warcraftlounge.com.  We are available for download on iTunes.