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EGD News #83 — To have a startup is the fastest way to learn

EGD News #83 — To have a startup is the fastest way to learn

Sent on May 28th 2021.

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It’s Joakim here. Greetings from Helsinki!

This week I was on an airplane for the first time since January 2020. It felt weird to go through the airport and relearn all that again.

Our podcast with Miska and Sophie got lots of attention and I have been receiving lots of feedback and thanks for the episode.

For those of you who’ve not been following this one, to summarize: I, Miska Katkoff, and Sophie Vo did a Deconstructor of Fun podcast episode, where we talked about Patrick Lencioni’s book Five Dysfunctions of a Team and how it relates to gaming. I wrote a piece last week about the episode. You can read that and listen to the podcast by going here.

Lencioni has written some twelve books on leadership, and here are the books that I’ve so far:

Now I’m reading the Five Temptations of a CEO. That’s an amazing one as well.

Now, onto the news.

🎙 Karoliina Korppoo, 10th Muse

This week on the podcast, I’m talking with Karoliina Korppoo, the founder and CEO of 10th Muse, a Helsinki-based startup that is working on an interactive romance reading and self-publishing platform. Karoliina started the company as a solo founder, building the vision, team, and the company. Her background is in PC gaming, where she worked as a lead designer on games like Cities: Skylines and Cities in Motion. In this podcast episode, we talk about Karoliina’s journey into startups, where the idea for 10th Muse came from, and how the creator economy is shaping gaming.

Here are my favorite takeaways from the episode.

What were the biggest takeaways from developing Cities: Skylines that you still think about today?

Games are actually just big learning machines, a person playing a game is learning how to play that game at the same time as they are playing. The dopamine hit that we get from playing is when we succeed in something, we learn something. We get this flash of insight like, this is how it’s done. Games should be built around the tutorial system, which should not be separate from the rest of the game.

In Skylines, the system tries to understand if the player knows what they are doing. Experienced players rarely see the tutorial messages at all. The system notices that they have zone buildings, these buildings have electricity and water, everything is fine. If there’s something new that they don’t understand, then they’ll see pop up saying, “okay, maybe you should try this?”

If someone is very inexperienced, they can take as long as they ever want to zone their first buildings to get the water pipes there. And the game will just try to teach you again and again how to do this thing. And only when the system notices that the player seems to have mastered this, then something new unlocks, and this has been built throughout the whole game.

This feels very good to the players, they generally want to feel confident, and they want to feel that they know how [the game] works.

How do you see the creator economy becoming a bigger thing for game developers?

I believe that as people play more, they better understand games. And that’s when it starts to make sense to allow these people to make games, or levels or content. So I believe that these creator economies will be coming on much more strongly. And even some of the game companies are moving towards making platforms or tools for creativity.

Roblox is a good example. If you give the tools to people, they will make a million games, and that is what will happen. So I really want to see everyone using their creativity.

And this also means that we get a big advocate for equality and diversity when the creation tools for games stand to be accessible to, say, the developing countries. It means that we will get games that look like those cultures that fit those cultures. So that then there isn’t this kind of gatekeeping anymore, that the well-to-do white people in the West generally will make all the games, so all the games kind of look like us. [The creator economy will] open up this whole diversity and kind of abundance of different kinds of creative ways of making games and different kinds of games.

Listen to the full episode by going here.

This newsletter is sponsored by Favro

🙌 To have a startup is the fastest way to learn

I recently wrote on Twitter and LinkedIn: “To have a startup is the fastest way to learn stuff. You can learn more in 1 year as a startup founder than in 10 years in a safe job.”

Once you get over the risk-aversion of jumping into the unknown of a startup, you start to see that it’s not all that bad. And you’re learning a lot. You learn about all the aspects of building a company. You learn about putting together a team and how the team can work together to make games. You get to learn about financing the whole operation, which is an exciting and complex world of its own.

I believe that most founders go through the learning path of learning what not to do.

Startups are the quickest way to learn about things, often the hard way, but you become better prepared for future situations in any case. I started my first startup in 2005, raised funding in 2007, and closed it down in 2011 after we ran out of money. What are the top three things that I learned from the startup? Here I’ll cover my startups.

What did I learn in my first startup Ironstar Helsinki 2005 to 2011?

Misconception 1: The harder the idea, the better it must be.

When the numbers aren’t good enough, don’t waste months or years to find the right numbers.

The illusion I had was that eventually, an audience, which was not immediately available, would be attracted to our game.

Then there’d be enough critical mass, and the game would start growing on its own.

It’s a costly illusion. Among Us’ developers placed a bet on that illusion, and it paid off for them, but it’s impossible to predict something like that.

Misconception 2: Quick success is possible. “If you build it, they will come.”

I thought that I’d raise funding by having a brilliant game idea and investors falling in love with the idea. That never happens. Investors don’t fall in love with ideas; they fall in love with traction.

At the same time, I had the illusion that a bigger company would buy us because of the brilliant game idea we had. Again, the same misconception, with different parties involved.

They are more of a lifestyle choice.

Misconception 3: It’s better to own as much of the company as I can

I had 100% ownership of the company, and later, when I’d done several funding rounds, I still owned a majority of the company.

But it was hard being alone as a solo founder, especially as I didn’t know what I was doing.

The lesson is that more co-founders will share the burden and can work together to solve problems. So don’t start a company alone.

Some stats from our last game at Ironstar. Up and to the right? Not for long.

So, what did I learn in my second startup, Next Games?

Not to bite off more than one can chew

Our first game at Next Games was called Compass Point: West, and it was built in the era when build & battle games were very popular. It became an extensive online multiplayer game, with PVP (player vs. player) gameplay, which required us to build lots of tech to support the gameplay. We also needed to create cheat prevention, LiveOps, and all sorts of tools.

At first, we felt that we could pull it off in six months to have the game soft-launched, but six months turned into over a year of initial development to soft launch.

The lesson learned here is to look at how long the game will take to develop and only commit if you want to bite off a big bite that you can chew and swallow. Or should you look into doing a first game that’s less immense to build?

Early rapid scaling

At Next Games, we were swinging for the fences from day one. We raised a big A round very early, went to thirty people in a year from starting the company, and got two great games in development in less than no time.

We couldn’t have done it without all the effort that went into building the teams, recruiting people who could take challenging roles in a fast-growing startup. You don’t get to see that so up close and personal if you’re not doing a startup. Most established game studios will have already gone through that cycle of early rapid scaling.

If I did a third games company, what would I do?

More “At bat”

There are two areas I’d focus on and would probably learn a lot from these: Early on in the company, to continue the baseball analogies, I’d optimize for “at bat” opportunities, quantity, and quality—a product strategy with games that can be soft-launched in 8 weeks. We talked about this on a recent Merge game webinar.

Utilize industry peers

Secondly, I’d utilize peers in the industry for tricky questions and situations that need to be solved.

To summarize, I wouldn’t be doing what I’m doing today if I hadn’t made my startup founder journey.

Here’s a couple related articles that I’ve written about learning in gaming startups:

📃 Articles worth reading

What Supercell’s $180M credit facility to Metacore signals to the wider mobile gaming ecosystem — “Last week, Metacore Games reported it had raised a $180M (€150M) credit facility from Supercell, one of their main equity investors. What does this signal to the wider mobile gaming ecosystem, and why is it a huge deal?”

Efficiency is the Enemy — “As individuals, many of us are also obsessed with the mirage of total efficiency. We schedule every minute of our day, pride ourselves on forgoing breaks, and berate ourselves for the slightest moment of distraction. We view sleep, sickness, and burnout as unwelcome weaknesses and idolize those who never seem to succumb to them. This view, however, fails to recognize that efficiency and effectiveness are not the same thing.”

What is Hypercasual? Relatable, snackable, satisfying — “Hypercasual games have snuck up on even the most knowledgeable and trendy gamers in the world over the past several years and have made a massive splash in the wider gaming industry. If you’ve never heard of them, you’re not alone. But, odds are that you’ve played one or seen them littered throughout the App Store’s top games list.”

💬  Quote that I’ve been thinking about

“Nothing is as powerful as an idea whose time has come.” — Victor Hugo

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I hope you have a great weekend!