Ask Me Anything #4
This is my fourth Ask Me Anything podcast episode, where I answer people’s questions related to game studios, fundraising, and all other entrepreneurship-related stuff.
Here is the transcript from the episode.
Let’s take our first question of this episode. John says:
I’ve seen you previously post advice on social media that it is overkill for early-stage studios to invest time/resources into backend tech for things like leaderboards, etc, which I fully agree with.
What about when it comes to analytics infrastructure? I’ve seen some (previously early-stage) studios credit the robustness of their data infrastructure as a key factor in their ability to scale their games. For example, Small Giant Games.
In your opinion, is an off-the-shelf solution (ie: DeltaDNA, Amplitude) suitable enough for an early-stage studio that has ambitions to scale a game, or is it highly important to build a custom infrastructure if they have ambitions to scale the game through Paid UA?
This is a really interesting question, John, because I’ve also recently been talking to people about this.
I can first say that at Next Games, we started off by using a third-party analytics tool, but there were a lot of problems in getting it to work. The realization was that you’d need customization, always, that is the fact, even when you’re working with a third-party analytics provider, you will need customization.
So then the question comes down to this: can you find a provider who can provide customization. So the tools that we were using at next games, were not very customizable. And what ended up happening is the provider couldn’t keep up with our demands for new dashboards, so they opened up their data warehousing where we could run our own queries in to the data, and build our own dashboards, based on their data warehousing.
So we ended up not using their sort of built-in suite of dashboards that much because we relied so much on looking at the data that was very custom for our games.
But the problem is here: when you go into building your own tools like small giant games, or you need to set up your data and dashboards to be of high quality and always available and customizable, you’ll actually need to hire a lot of people to run the analytics operation.
It’s a very technically demanding: if you think about having 1000s of players every day interacting with your game and you’re saving the data as they’re interacting with the game, sending events to a data warehouse storing them processing them into something that’s useful for querying. That is actually a full-time job for somebody that’s usually called the data engineer. And these people aren’t, you know, they’re not going to be cheap to hire for a startup. And then, then you want also somebody who’s, who’s running the queries, who are building up the dashboards. That’s another job, so then you already got an honored person coming in, sort of like a data scientist so you have two people already on the job of setting things up and keeping the new stuff that you need to look at running. And then you’re spending time doing QA on that stuff, like looking at bugs in your analytics. So, you need to free up some QA people from your games to look at the quality IDEs. And then what ends up happening, easily is that your data team is the bottleneck.
The key to good analytics use in a game team is the reliability of the data. There’s nothing like losing the trust in the numbers that you are seeing. The numbers need to be accurate all the time, there’s no way around that. And often that means that your poor data team will be spending more than half of their working hours on fixing broken data and providing a high-quality standard.
Over the years, I’ve turned more pro for external providers, but with some caveats. When you work with an external analytics provider, you’d want to make sure about a few things:
1) Are they ready to customize the data and the dashboards for you? Not only at the start but do they offer a service to continually customize things for you as you update your games and new questions come up? This is important because you don’t want to have your own team working on setting up the data correctly. Your team’s job is to ask the right questions and become data-informed by using the dashboards that are being provided.
2) Do they have experience from working with gaming companies? Especially games like you are making? If the provider is not on top of UA metrics, game funnels, and all the complexity that comes with game analytics, it will tough times for your teams to get reliable data from the dashboards.
3) Is the cost less than two data people’s salaries? Then it’s a no-brainer to use the external and not build in-house stuff.
So to answer your question John, I would rather pick a provider who can build lots of custom tools on time. You mentioned DeltaDNA and Amplitude, but I’ve recently seen a lot of developers moving over to Dive. I’m having Elad, the CEO of Dive on the podcast soon, so I’ll be sharing more on this topic. If you want to check out Dive, you can find them at dive.games.
Second question comes from Pascal who asks:
Could you please dedicate an episode of the podcast to the steps a solo developer can take to expand his/her start-up?
Thanks Pascal for asking this question. I cover this quite well in my book “The Long Term Game: How to build a video games company” but let me elaborate on how to go from solo-developer to expand your startup.
The first step is to know what you want. If you want to expand your startup from being a solo developer to not being a solo developer, you’ll need a team. Before finding those people, you want to know what the startup will do. If you are making games now as a solo developer, do you want to make more games, with higher quality and more depth? You need to know what you want the company to do before you reach out to possible team members. You should also read a book called Start with Why, by Simon Sinek, who talks about people and businesses become successful because they are living and breathing a purpose. It’s not just about making cool games, but how you can transform your audiences with experiences that enrich their lives. The reason for your startup to exist helps a lot in getting out of bed for five, ten, twenty years, however long you will be building a company for that purpose.
The second step is to think about what kind of team you want to build for your startup.
I don’t have any objections to people doing solo development, but if you have the ambition to build a company with a lot of people.
The first thing to do is to start thinking about the core team that you want and need to have.
My experience with Next Games was that I spent the first six months just putting together the right team, I went through probably 20 different people in the Helsinki area who fit the roles that I had in mind for the core team. I wanted to have a team that could make a mid-core mobile game.
That would be two technical people, then someone who could do art and creativity.
And I saw myself as the product person, so I just set out to look for those people
What helped a lot was that I had posted on Facebook that I’m going to start a new adventure. And I’ll share more soon. I didn’t mention that I’m starting a studio. But still, a lot of people reached out to me that they had a friend who is looking for some new challenges, who is interested in gaming was already doing maybe some games already working in the industry.
So there were a lot of friends of friends that I met through the process, who I talked to. To build a team is to utilize your current network to find people that your network knows.
And after that, you start working together in ways where you see that you can fit together as a team. So you expand your startup by thinking about the team.
Then you want to know how you will get paid to make a living because often people want to have some security.
The options for this: you start doing some kind of outsourcing, or work for hire, or working with a publisher who’s paying you to make games. But there can be problems: you’ll need to show some products that you’ve been working on as a team. And you become more convincing with this, towards the publishers.
The other route is to go and talk to investors, which also requires some work and showing some progress.
I think one approach is to think about building the core team that can produce a game with minimum costs, like you would do something in your spare time, working on the game.
Note: the startup doesn’t get any easier when you bring in more people. It gets much more complex and you need to start becoming a leader. There’s a bunch of great leadership books out there. I really love the sports team coach books like Leading which is about Alex Ferguson and The Score Takes Care of Itself, about 49ers coach Bill Walsh.
So make sure that you know what you’re getting into, as you’re expanding your startup.
Start with the company idea and purpose, then the team and figure out how you’re going to pay salaries to get to some kind of progress, where you can show that you’re growing,
Expanding a startup means that you’re progressing, you’re growing, and you’re eventually going to go to revenues. And remember that it’s all about execution on those ideas, and not the ideas themselves, that will take you from A to B.
This one comes from Esa who asks: I’m developing a casual mobile game (solo). Should I self-publish or find a publisher?
Thanks, Esa for asking this question! Well, I think personally that self-publishing as a solo developer is not always the best option. You have a lot of flexibility in trying out things and you can keep all the revenue, but it really depends.
I think you can find several publishers in the mobile space who are happy to test your game to see the soft launch numbers, like, and they don’t really care about the size of your team. Are you a solo developer or do you have a team?
So both routes are good, I think, some, some considerations for both.
When you are self-publishing, You will need to run Facebook campaigns to test your game to see if it makes sense to do user acquisition and marketing for your game. I think nowadays, it is quite impossible to just turn on your game on the App Store and expect downloads and installs to start coming in. It’s just doesn’t happen.
It’s a crowded space in the mobile app stores, so you won’t get that visibility that you would have gotten 10 years ago, where you would get downloads, a lot easier because there was less competition. Now it’s too crowded.
So, that’s the one thing that you need to consider is, are you willing to start doing user acquisition, And you want to do profitable user acquisition, so you need to understand when you’re buying a user, how much getting that user costs, and can you get that money back.
Measuring is one of the key things when you’re launching games on mobile platforms.
I think there are lots of solo developers out there who are launching a lot of games, but what they did is they, they did have some success, and then they started cross-promoting their own games between their own games.
But if this is your first title and you are a solo developer, you’re putting the game out. It’s highly likely that you won’t see any installs, without doing any marketing. So that’s what you need to prepare for.
Then the consideration about going through a publisher, is that they won’t really help you on making the game a better game. Sure, they will be happy to give you some advice as they’re playing the game and give comments, and they will test your game on the App Store to see what the numbers look like there are a bunch of publishers like that.
But you will then, again, end up in a situation where you have data on the user acquisition numbers like is it profitable to acquire players to your game or not. So you can’t skip that stage. If you go with a publisher, you don’t need to run UA yourself. They will take a few $100 and spend them on your game to see what the retention numbers and things like that look like. So, you will have that off your hands. In exchange for a publishing deal if the game works.
It’s an interesting situation where if you don’t have the user acquisition capabilities, you don’t have the cash to market the game to make it a big success. Then going with the publisher is the best option. That’s the easiest sort of route to quickly try out games for instance if you, if you have a lot of ideas. Which is what you should be having.
You want to start testing them out quickly, and the publisher will help you with that as sort of like an external partner for testing your games. So that’s how you could treat the publisher.
Your question was, should I self-publish or find a publisher. I think if you are just starting out with launching games, publishers are great. You will learn a lot from their process of what kind of information they bring back to you. And you can always go back to self-publishing later on. And the cool thing with mobile games is that the development cycles aren’t that long. You can be trying out several games. Not spending many months on one game to see what works and what doesn’t. So start with a publisher, and later on, evaluate the self publish versus publishing through a publisher option.
The final one comes from Carlos, who starts by saying that:
The VC model of rapid growth encourages quick company scaling at an early stage, in wanting to build a gaming company that aims to a niche audience and keeps the game development team small to keep the game’s vision tight among the founders. What would be your approach to sell this vision to investors? Can outsourcing be a better solution for company scaling if the game grows unexpectedly than heavily increasing an in-house team?
First, let’s tackle the question of keeping the dev team small, to keep the game’s vision tight. And selling that to investors.
I think that is fine, and I think that VCs who understand gaming, will concur that you’d want to keep things in control as long as you are in the stage where you don’t have a clear success game in your hands.
But, you want to be relaying a message to the VCs on how you plan to grow to become successful. You mentioned a niche audience, do you have a grasp on how big the market for your game will be? Is there already an established genre out there for your game where the investor can easily understand the potential of a hit game in your genre? If there’s vagueness on the size of the potential audience, you can have those discussions with the investors, but you’ll be in a much more comfortable position to raise funding, once you have proof of your game working. On mobile, you share metrics like player retention, ROAS for user acquisition, things like that. When on PC and console, the early signals become harder to decipher and you might end up in the bootstrapping mode until you reach a situation where you can bring in people to look at your business and to assess what investor money will do to make your company become a bigger success.
Even on a more higher level: Investor money is meant to take companies to the next level. You can be in a niche audience segment, you can have a smaller team, all that is fine, but you want to be in the position to show that investing money in your company will generate growth for the company. There is a certain amount of risk that the investors are willing to take, but they will look at your team, their capabilities and what you want to do quite carefully before they commit.
Then your question on outsourcing. I’ve been there before and have been bootstrapping and doing outsourcing work. If you have the capabilities to work on outsourcing and also produce your own game at the same time, I think you can try to do that for a while. You will be building your company as you outsource and you will be training your team on working together.
If you have more questions, please do send them to the questionnaire. You can find the link by going to elitegamedevelopers.com/askmeanything typed together, without any spaces.
I wish you all a pleasant week and hope to see you soon! Take care everybody! Bye bye!