EGD News #56 — Batting Average
It’s Joakim here. Greetings from Helsinki
In the past week, I’ve completed two books: The Practice: Shipping Creative Work (2020), by Seth Godin, and Turning the Flywheel (2019) by Jim Collins. The books have similarities but they’re also quite different.
In The Practice, Seth Godin focuses on the individual’s daily effort, the consistency of a practice which then yields results.
Favorite pieces from The Practice:
- “Hubris is the opposite of trust.”,
- “The story we tell ourselves leads to the actions we take.”, and
- “Generosity is the most direct way to find the practice.”
In Turning the Flywheel, which is a companion book for Good to Great, Jim Collins talks about how no single task or effort creates lasting success.
Favorite piece from Turning the Flywheel:
“The flywheel, when properly conceived and executed, creates both continuity and change. On the one hand, you need to stay with a flywheel long enough to get its full compounding effect. On the other hand, to keep the flywheel spinning, you need to continually renew, and improve each and every component.”
Both books are brilliant and I have a goal to create Youtube video reviews on both books, right after Gaming Angel Fellowship launches.
Here’s some quick updates from my side.
- There has been a delay in launching the enrollment page for Gaming Angel Fellowship, but we are all good to go for the actual launch which will be on December 7th. Some new content has been created, including interviews with Eric Seufert who operates the MDM Angel Syndicate and with Henric Suuronen, angel Investor and Founding Partner at Play Ventures. More on Gaming Angel Fellowship next week.
- Next week, I’m doing a live webinar with James Cramer from Skunkworks, where we talk about how James and his co-founders approached angel investors and eventually raised two angel rounds. You can sign up for the webinar by going here.
- I’m doing a collaboration with PocketGamer, where I’ll be doing a MasterClass on fundraising for gaming studios on December 2nd. PockerGamer recently published my interview, where I talk about the contents of the course. Check it out here. Registration for the MasterClass happens here.
Now, let’s get into the news.
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⚾️ Batting Average
In baseball, the batting average is the number of hits divided by at-bats, which basically means swings that try to hit the ball. It’s usually rounded to three decimals and read without the decimal: A player with a batting average of .300 is “batting three-hundred.”
A higher than .400 is a nearly unachievable goal. The last player to do so was Ted Williams of the Boston Red Sox, who hit .406 in 1941.
When founding a gaming startup and planning for how long the runway will last, the founders need to think about their batting average: how many tries will they get at making a profitable game with the runway they have? As Eric Ries said in Lean Startup: “The true measure of runway is how many pivots a startup has left.”
This dilemma doesn’t change when you have investor money, since then you will be on the clock: how many games will you need to ship before you reach success.
As an investor, I might use the “batting average” to evaluate game teams. I could ask: How many tries at-bat will these founders have before they run out of cash?
I think that gaming has evolved a lot, and there are so many possibilities for validation. Previously, game developers didn’t have the ownership: publishers handled distribution, marketing, and live ops. Now it’s all for the taking. The developer owns everything, they facilitate a direct relationship with their audience, and have access to all the data.
Projects were longer. Now we are back to talking about weeks or a few months.
Supercell was founded in 2010, and they’ve only launched five successful games. But they’ve gone for the home runs. For a fledgling startup, what matters is that you hit the ball, which is the equivalent of making a game that pays the team’s salaries and ends up making some profit.
In Brazil, Wildfire Studios build over a hundred games before they got their first two “home run games” with Tennis Clash and Zooba. Same for Peak Games; they develoed dozens of games before their “home run games” Toy Blast and Toon Blast. Both companies had many games before then, which kept the lights on.
You don’t need to immediately hit a home run, but you want to start improving your batting average from day one.
🏝 Burnout recovery and building something new
I recently did a podcast with the Finnish financial publication Talouselämä, on the topic of burnout, recovery, and entrepreneurship. Since the recording was shared in Finnish, I went and transcribed it in English. Here are my picks from the interview. You can read the full transcription by going here.
Q: Let’s talk a bit about your work life balance. When did you realize your burnout?
A: I left Next Games in early 2019. I had this mentality that I want to know that things are progressing. When you are an entrepreneur in gaming, you can get lots of setbacks with games that fail to materialize success. I noticed that since I had such a hard time with meeting the expectations that I was setting for myself and the company, that the burnout was a symptom that started revealing itself in my daily work and life.
Q: So it was your expectations that were causing the burnout?
A: Yeah exactly. I had these expectations, high expectations that the company will finally do well and there will be lots of success coming our way. For me, being a startup founder is a big part of my identity, I think it’s quite common — that the entrepreneur is the embodiment of the startup. Then I started “flagellating” myself for the things that weren’t going my way. Burnout was the main symptom.
Q: You were actively fundraising for Next Games, to aggressively grow the company. How did the nature of the work affect you?
A: The work of a startup entrepreneur isn’t you’re regular 9 to 5 job. But it’s not really a job where you’re pounding the keyboard 150 hours a week. I believe that a lot of entrepreneurs are working eight hours a day. But the entrepreneur will be thinking about the job 24/7. All the worries, all the aspects of the job are coming to you, back to your mind, wanting to be processed.
Q: You have now started a smaller company which isn’t a VC backed growth startup. If you found your role inside Next Games too overwhelming, why didn’t you just change roles inside Next Games?
A: That’s an excellent question. I thought about this same question a while ago. For me, it’s important to be an entrepreneur. If I’d take on a role where I’d be less overwhelmed, it wouldn’t feel like what being an entrepreneur would, and should be like.
Read the full transcription by going here.
📄 How to structure a management team in gaming
This week I wrote an article on how you should think about structuring a management team for a gaming studio. What roles are necessary at the top and how you apply the best parts of a traditional hierarchy to a more flat hierarchy.
“Besides the CEO, I would want to see a double role taken by one individual, who would act as the COO & CFO, meaning the chief operations officer and the chief financial officer. They would serve as “the Chief of Staff” for the CEO, and they’d have a finance team and an HR/Ops team under their wing.”
Read the full article here.
🎙 Tales from Playtesting with Elie Mouraud from PlaytestCloud
In October of 2020, I did a webinar on playtesting mobile games with Elie Mouraud from PlaytestCloud. We talked about how you can learn more about your game by focusing on the player’s experience, from early on in the development, all the way to soft launching and going live.
Listen to the full episode here.
📃 Articles Worth Reading
+ The argument for simpler games — “This common obsession with complexity (regardless of how well-intentioned it starts) is at the root of many problems in the industry. Lack of focus and vision is often cited as a reason for a project that failed, and/or caused significant crunch and stress to employees. It is directly associated with complexity. Yet nobody is talking about our complexity problem.”
+ Angel eye — “I get excited about the idea of more women stepping into their power and grabbing a seat at the table, I can’t wait to see what that will lead to. I’m inspired to help enable and support more women to consider a career as a startup founder or as an investor and I’ve been thinking about ways to scale it.”
+ Roblox files for IPO — “The Roblox filing outlines a number of potential risk factors for the company, including fairly common risks for such filings in the gaming space such as seasonality of the business, its dependence on online networks, potential regulatory shifts, and the recent COVID-19 pandemic.”
+ A conversation with Paul Murphy, GP at Northzone — “The difficulty curve of a game needs to be different [in China]. In western markets, we might onboard someone over the course of two or three days, or five or six hours of gameplay. In China, you know, you have to make that happen much faster, because they are much more savvy on mobile gameplay.
💬 Quote that I’ve been thinking about
“Every man must decide whether he will walk in the light of creative altruism or in the darkness of destructive selfishness.” — Martin Luther King Jr.
Sponsored by ironSource
We all know that developing a great game is one thing, but developing a great game business can be something else entirely. That’s why some of the top game developers in the industry use ironSource’s game growth platform, which takes care of both sides of the business, helping you monetize to fuel user acquisition, and vice versa.
From their ROAS Optimizer, the only product on the market built to optimize UA campaigns towards ROAS according to both IAP and ad revenue data, to LevelPlay, their in-app bidding solution, they offer everything you need to supercharge your growth. See for yourself at ironsrc.com
Sponsored by Opera Event
Looking for some great new authentic video creative? Try something totally new with Influencer Generated Content (IGC) by Opera Event. Influencers or actors will make specific creative content for your games and Opera Event will deliver you high-quality video ads that highlight the best parts of your game.
Note! You get a free video with the purchase of 4 or more videos. Remember to say that Elite Game Developers sent you!
Go to www.getigc.com to see some examples and get more information.
That’s all for this week. Take care and stay safe!
Joakim
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