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Creating a game is no easy task, but most people who undertake this mission are motivated by a passion and love of games. Raising money for development, on the other hand, isn’t on every game dev’s list of favorite things. Still, in order to see their babies come to life, many a game maker has gone in search of funding. While game publishers are the source most game developers turn to, this post looks at three alternatives. In the end, who you turn to will depend on the nature of your game and the stage of your development lifecycle when you approach them.

1. Love-money

If you’re just starting out, and all you have are some mad skills, a lot of determination and an idea that you believe in, then sometimes the only place to go is to family and friends. Or as some game creators have been known to do, show yourself some love by backing your own work via loans, your regular day job, or client work.

Good old Mom & Dad and Uncle Tom

Yes, sometimes loved ones may be the only ones willing to back you. This was indeed the case in Unity’s own history when the three founders turned to family for help back in the day with their idea for a game engine.

“We had been living in a sublet room on a ridiculously cheap budget watching whatever money we had saved up from past jobs slowly dwindle, surviving on a daily diet of kebabs, and basically working around the clock,” says David Helgason, one of Unity’s three founders.

“We were young with no family commitments, so we could afford to live like that and invest the time. But when the money we had saved from other jobs ran out, we turned to family and borrowed around 100,000 euros to see the project through,” Helgason says.

Doesn’t have to be a huge risk

Of course, in this case, the story had a very happy ending with the birth of the Unity game engine, but had it failed, the borrowers would have had to face the consequences. Still, even looking back, Helgason doesn’t consider it a crazy risk.

An image from Gooball, the game developed by the Unity co-founders in 2005 on the original 1.0 version of the Unity game engine.

An image from Gooball, the game developed by the Unity co-founders in 2005 on the original 1.0 version of the Unity game engine.

“If worse had come to worst, we could have worked it off in a few years. Yes, it would been dreary, but it seemed relatively safe to us, and we believed enough in what we were doing,” he says.

However, Helgason does see some truth in the old saying: ‘Don’t raise money when you need it, raise money when you don’t.”  He says that if they were just starting out today, they probably would have done things differently.

“The environment is much better and healthier today; there’s a lot more people willing to assume risk. And tools have gotten cheaper. You can tap into the game engine community, and things like the Asset Store make it easier to lower the cost of production,” he says.

A little self-love

An alternative to turning to your family is to back yourself up. Many a studio butters their bread via freelancing, consulting, developing business apps, or some other “grown-up job,” in order to finance their dream project, which they run on the side. Or sometimes, as in the case of Fireproof Games, they save up until they can afford to bring their baby to life.

Fireproof Games built a business foundation on freelance projects for other studios as an outsourced team of artists and game design experts. They then used that base to finance their own creative pursuits when they’d gathered enough resources and the time was right.

The journey is sometimes long

It took Fireproof Games four years from their start in 2008 before they were ready to create their own game. And even then, it was only the emergence of the Unity engine that enabled them to do it with limited programmer resources.

“In early 2012 we had saved enough money to hire our first programmer and got to work building a creepy tactile puzzle game with Unity for tablets and phones. We named it ‘The Room’ and released it in September 2012, and to our great surprise it was an instant hit,” they wrote in a Made with Unity story.

Able to pursue their creative vision, Fireproof Games went on to become an independent studio working full-time on their own games. The Room was followed up with two sequels, and altogether, the series has sold over 10 million copies. To learn more, you can read the Fireproof Games Unity case story.

2. Crowdfunding

Sometimes it takes a community to raise a game

Kickstarter, Indiegogo, and other crowdfunding sites that focus solely on games, like Gogetfunding, Fig, and GameLaunched, offer an exciting, (relatively) new way to raise money. However, people often underestimate the amount of effort it takes to raise cash via crowdfunding.

“Well, I can always just do a Kickstarter,” I saw one optimistic game developer comment on a fundraising forum.

This simply isn’t the case. A crowdfunding campaign has never been easy,  and as the popularity of platforms like Kickstarter grows, it becomes increasingly difficult to gain attention for one’s own campaign. The truth is that a successful crowdfunding campaign is hard but not impossible. The Kickstarter video game project success rate for the first half of 2016 was around 18 percent.

As with anything else, success requires a high level of focus and the right kind of effort. You should start developing your community at least nine months prior to your campaign launch, and you should plan on one to three months to prepare the actual campaign. Setting a realistic target goal, starting to plan early, involving your community, and, not least, remaining hyper-active on social media throughout your campaign are some of the important best practices.

“You need to have all your preparation in place before you start because Kickstarter’s rules mean that it’s all or nothing, one shot,” says Mark Folkenberg, whose Books & Magic studio’s Kickstarter Project did not meet it’s goal.  “You’re going to have to spend so much energy on it that you should do it right the first time. And if you find that you’re not ready, then, postpone it, and reuse some of the work when you are ready,” he advises.

Books & Magic later found investors to back their project,  an augmented reality book, which brings new life to Hans Christian Andersen’s Little Mermaid tale.

Books&Magic

A scene from Books & Magic’s augmented reality version of Hans Christian Andersen’s The Little Mermaid.

Getting featured on Kickstarter

Careful marketing planning and intense activity helps you in two ways. First, it addresses the fact that you can’t necessarily depend on Kickstarter to find new backers. Second, if you do hope to get discovered on Kickstarter, it’s important to get featured on the default setting of their advanced Discover tool known as “Magic.” This setting toggles between a prominent display of most popular posts and staff picks. An abundance of social activity could go a long way to getting your project featured.

Team Niche, which reached the funding goal for their genetic survival game after just three days, have written about the lessons learned from their success.

“We could never have reached the same level of funding without our small, but dedicated fan-base. Over the past year, we visited various events (such as GDC, Gamescom and Game Connection) and posted frequently on social media (mostly Facebook and Twitter) in order to connect with people that are interested in our game idea,” Team Niche wrote on Gamasutra.

3. Investors

Although the lines between the categories can get blurred, there are basically three different types of investors: incubator/accelerators, Venture Capitalists (VCs) and angel investors.

Accelerators: From idea to prototype

Incubator/accelerators, like GameFounders, Microsoft Greenshoots in London and Stugan in Sweden. tend to back projects from the initial idea to the prototype stage. In addition to funding, they also provide resources meant to accelerate your development cycle (although in some cases, they actually only provide the resources and not the funding). Resources can include capital, free rent, networking and coaching, for example.

VCs help you take it to the next level

If accelerators often only take a game creator as far as the prototype stage, VCs on the other hand often get involved later in the project cycle. In fact, game makers who turn to VCs may already have a full team in place and even a prototype with some initial community interest, but for whatever reason, they are unable to take it to the next level on their own.

VCs avoid backing just one game; and instead look at the whole team and their long-term vision. Before investing, a VC will take a thorough look at who’s on your team, what they’ve done, and how they complement each other. They want to hear about your team’s long-term vision, the kinds of games you plan to make, to see a technology roadmap, and to be sure that there is potential for the game to scale and the studio to grow in value.

VCs play the long game

VCs are betting on you for the long-term, and as such, the resources they provide can be more far-reaching than what accelerators offer.  But VCs that are interested in game development can be difficult to find. What’s more, even VCs who do focus on games, like Execution Labs, will only back projects that that offer serious commercial potential.

“We’re a commercial investor, and we ourselves are venture funded. We’re not a charity and we’re not an arts council,” says Jason Della Rocca, Co-Founder of Execution Labs. “Obviously, it helps if it’s a cool game or a concept that inspires us, but that’s just one part of it.”

brofist

PewDiePie: Legend of the Brofist was developed by Outerminds with the support of Execution Labs in 2015, and became the top-grossing paid game in the United States App Store less than two hours after its release.

In order for them to be interested, the game or idea must have the potential to scale and generate huge revenue.

“The upper end of the scale has to be so high that it can’t even be calculated,” Della Rocca says. “We won’t make millions every time, but when a game wins, we want it to win big..”

Ultimately, VCs are professional investors that need to seek a return on their investments. As such, your game and studio must be an actual opportunity to catch their interest and support.

The missing resources you don’t have in-house

While their expectations may be high, VCs do extend more resources than what the average accelerator might offer. For example, Execution Labs resources include marketing and PR aimed at acquiring new users, on-staff experts in analytics and business planning, and the ability to expedite deals with a broad network of other investors, publishers, and global distributors.

Angel investors

Angel investors are affluent individuals looking for an exciting project to invest their own money in. Whereas VCs are more focused on the numbers, angel investors can be driven by other factors.

“While VCs look at things like sector growth and potential valuation, it can be much more personal with angel investors,”Della Rocca says. “Of course, they’re not going to just throw their money away, but they can be influenced by thoughts like: ‘Am I going to want to come by and hang out with these this team and be able to mentor them.’ There’s more emotions involved.”

Where are those angels (and other funding sources) hiding?

You may be a young, inexperienced beginner looking for love money, an established team seeking a push for your idea from crowdfunding or accelerators, or a studio that already has a prototype, which needs backing to take it to the next level. Whatever the case, a good way to increase your chances of success is to build relationships in the gaming community, industry, and with potential investors by networking actively.

Mark Folkenberg, who found private investors with knowledge of the gaming industry for his studio’s AR book project, says it’s important to give yourself good time to find the right investor.

“Finding the right contacts can take months, and then the pitch itself can take months as well, It’s better to give yourself the time to work on potential leads than to have a launch date and rush it through when time and money are running out.”.

But Folkenberg does have a final word of warning for fellow fund seekers.

“When you’re out there pitching your product, listen to what everyone says, but remember that in the end, it’s your project, your vision, and you have the final word.  Don’t fall into trap of thinking that because you heard it ten times, it’s true. No one knows your project like you,” he says.

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  1. “PewDiePie: Legend of the Brofist was developed by Outerminds with the support of Execution Labs in 2015, and became the top-grossing paid game in the United States App Store less than two hours after its release.”

    It is important to note that what actually exclusively made it the “top-grossing paid game in the United States App Store less than two hours after its release” is that it was heavily marketed by the hugely popular youtuber whose name can be found at the beginning of the game’s title.

    And so whatever section of this article referring to that game should read less about anything else and more about getting the funding to pay your employees by appealing to an already-established previously-monetized user-base.

  2. I just went to GameLaunched via the link in the article and all I got was this:

    Over Quota
    This application is temporarily over its serving quota. Please try again later.

    Ummm…Well, I can always just do a Kickstarter
    :P

    1. The link seems to be working now — gamelaunched.com

  3. Robert Cummings

    August 8, 2016 at 10:39 pm

    The missing number 4 (which should be 1 IMHO):

    Make a smaller game to fund a bigger game. Yeah, unbelievably, it’s possible to make a bunch of smaller mobile titles and gain the revenue to make larger, more ambitious titles. This approach is what I call common sense, and the only true path to success.

    No offence intended, but this article isn’t really the advice you should be taking. You should build your smaller titles for a number of fundamental reasons: experience, funding and so on.

    Trying shortcuts like this article suggests, means you’ll make mistakes when it’s costly to do so. And you WILL make mistakes.

    1. Not all the games are successful and making money. We have a big game that is making money, but we tried to launch other big or small games, and they almost made no money.

      Anyway, by making small games or crowdfunding, you can’t be sure that you will earn enough money to be successful. You need to be in the top games (this doesn’t mean that the game is good…) to earn enough money to be worth. Be in the top game is hard, competitors are everywhere, paying ads, being featured.

    2. All of the advice assumes you know what you are doing, and the game you are making will at least pay for itself.

      If that is the case, then getting money from family is the best advice: no taxes, no interest, easy to negotiate, and you get the money immediately. Making other games is like saving money from work: it’s safe, but takes a lot of long-term commitment.

      Also, there’s nothing wrong with croudfunding and finding investors, as long as you can deliver. Then again, if you can’t deliver, making small games won’t work, right? ;)

  4. Make an Android game with in app purchases and place some ads, so you will get money. And make a paid version with no ads. After you get money from the Android game make your PC game dream.

  5. Do not ask your parents and family for money. Games lose so much cash so often that all you’re doing is wasting their cash. Been working in games for 15+ years now, do NOT use your parents money.

    1) Make a demo
    2) Make supporting documentation
    3) Pitch a publisher or crowd fund

    1. I will try to follow your advice, but crowd funding looks to me like a second parents …

      1. That’s the point. The entertainment bussiness is a high risk one. Your parents will risk money on you because of love, everyone else will risk on your idea because of the idea or the possible profit behind the idea. It’s easier for me to take money from people that take this as a calculated risk than taking money from people who give it out of love.