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Finding Funding

One small studio head’s experience with publishers, incubators, grant funding, and going indie

Finding Funding

Making indie mobile games has been a journey of satisfaction, disappointment, and education. Over the last three years, we’ve tried everything from self-publishing to working with publishers and incubators, and even applying for grant funding, in order to keep our small studio above water. Here’s what we’ve learned from each path.

Working with a publisher

Late in 2010, after two independent iOS releases, my company had become a team of two. Our pay-to-play games never made much impact on the iOS charts and our lack of a discovery strategy led to poor market traction. Aiming to solve this problem, we sought out a publisher that would give our third game visibility on the App Store.

After sending a swing mechanic prototype to Chillingo, we were pleasantly surprised to receive an immediate publishing offer. This rapid response may have been due to good timing, as just days before Tiny Wings was a hit with a similar mechanic. Going in, we knew that we would part with a revenue share of game sales and that in return we would get exposure on Crystal (Chillingo’s social platform), marketing to relevant websites, and "premium placement" on the App Store. We used a pay-to-play model and set the price at $.99, just like Tiny Wings and Angry Birds.

In the first week Chillingo assigned us a talented producer who gave us weekly feedback on our game for the duration of its development. Via Skype, he walked us through an efficient development process and mentored us on game design—which included everything from honing the core mechanic to choosing the most effective colors for our App Store icon. When the game was close to complete, Chillingo also spent time and energy focus testing with its target audience. In five months time, Swing the Bat was complete and had exceeded our expectations.

It was a Friday morning when our game went live on the App Store, and we were surprised to see two new games by Chillingo in the New and Noteworthy section. Unfortunately, neither of them was ours. After some digging we realized that Chillingo was publishing three titles every Friday with a model that I call "marketing triage." Placement on iTunes is determined by Apple but we wondered how we would have fared if Chillingo had only released one or two games that week. It also appeared as though the front-runners received the bulk of the marketing spend after launch. It was our responsibility to have reviewed the contract in more detail and If we were to work with a publisher again we would insist on negotiating a specific dollar amount for user acquisition and agree ahead of time how it would be spent. Lesson learned.

After we counted our App Store spoils—a few thousand dollars—Imaginary Games returned to a company of one and I moved to Vancouver, Canada from Sweden. I was pleasantly surprised by the active social mobile community and even started my own  Unity Games meetup. I was schooled to get to know acquisition, retention, monetization, virality, etc. and felt inspired to give the App Store another try. 

The game I came up with was the result of collaborating with a talented traditional artist named Elin Jonsson. Elin would make the art for the game and I would design it, but we needed money.

Applying to a private fund

My next step was to apply to the Canada Media Fund. I am not sure if this fund has counterparts in the United States or elsewhere, but in Canada, it is one alternative to a bank loan. The Media Fund is meant to foster the development of innovative interactive digital media for commercial potential. The application was daunting, but the evaluation matrix seemed reasonable: 40% marks for innovation, 30% for business plan, 15% distribution strategy, and only 15% for the team I didn’t have. The application took about five weeks, and I applied twice with a mobile collectible card game called Afterland.

Afterland is about a traveling carnival of lost souls and their story on the road in the afterlife. On top of a solid monetization strategy, the innovative design would open the doors of this game genre to a female audience. Instead of a war or battle, each player had a circus that needed to cooperate to give the best performance. Core collectable card game (CCG) mechanics would be simplified and explained with appropriate metaphors.

That spirit of innovation carried over to the technology that we planned to develop: The game would be an asynchronous multiplayer game, sharing user accounts between various mobile platforms, and we planned on building it in Unity and using Player.IO to handle the server backend needs. As part of our funding pitch, we proposed to make our Unity / Player.IO account system into a standalone Unity plugin called Social Fabric and sell it on Unity’s Asset Store.

Even though my application was full of additional goodies, such as letters of intent from publishers and future partners, it was rejected both times. When we reviewed our application to see where we lost marks, combined with some personal study of successfully funded CMF game projects, we came to the following conclusion: This type of fund was not for an indie company or an individual without an existing team or existing revenue. Another lesson learned.

Seeking government funding

During the application process I also sought out angel investors and venture capitalists but my “CCG for girls” seemed to pose too high a risk. Thankfully, just as we started getting ready to close our doors, the Canadian government threw us a lifeline; a mentor from Eastside Games suggested we contact the National Research Council of Canada’s, Industrial Research Assistance Program (IRAP). We received business advice, and a financial contribution to resolve some technical issues for the Unity plugin. With the IRAP contribution,  we hired two new full time developers. While I was elated to be afloat with a team of three, we still needed money so I could pay myself, Elin, and another artist.

Incubating Imaginary Games

We also looked at different incubators that could help us fund operations. We had an interview with Yetizen, a game accelerator in San Francisco, but learned quickly that their offer didn’t include funding. There was also Grow Lab in Vancouver but their three month program didn’t seem long enough and they were also not looking for game startups at the time.

When we heard about Execution Labs (“XL”) for the first time, the first aspect that stood out to us was the sheer depth of experience their mentors had. Digging deeper, we found that they were transparent about their deal terms, which are described in detail on their website. In short, Execution Labs gives $2,000 per month for each team member and $10,000 for player acquisition. They also house your team in office space in central Montreal, and provide the hardware and software needed to develop your game. In return, "XL" takes a minimum 10% of company equity and a 30% revenue share of the project that expires after a year.

We felt that we had finally found a program that could give us the money and support we needed to complete our team and make our game! After an interview we were grateful to be accepted as one of five teams in their first cohort. Only weeks later our team, now five, moved to Montreal to start at XL in mid-January 2013.

XL cofounder Jason Della Rocca met us with a handshake and grin at the new XL studio space on St. Laurent in Montreal. He explained to us that “XL valued teams over the game idea they presented,” and that proved to be an excellent fit for us. We saw them invest in their first five teams, including us, by exposing them to mentors that are often not directly related to the game industry, who would come in to speak about things like how to illustrate characters with character, agile management, flow, and even just general happiness.

In our case, mentors challenged us to understand what makes us special, and how we can best communicate this in a variety of ways. The importance of our story became apparent only days after the program started, when the teams had to present a five-minute pitch of their game. I thought this would prove particularly challenging for the teams that had come to the program without a firm game idea—as our game had been in the design phase for some time I assumed we had the other four teams licked.
I couldn’t have been more wrong. While our game presentation talked about virality and retention, the teams with less concrete game ideas were forced to tell their team's story instead. Inevitably, these pitches were more compelling than those focused on game mechanics because they really got to the heart of why they wanted to make games. Yet another lesson learned.

Now we spend time every Friday telling our story in front of each other and invited guests before we dive into the game itself. Learning to tell a compelling story about your game is at the heart of a good pitch. At GDC 2013 our improved approach helped investors, publishers and other developers latch on to our game idea in dozens of impromptu conversations.

Problems of Execution

On the other hand, some of the feedback from guests and mentors that drives XL’s process also has proved to be problematic for Imaginary Games. This could be best demonstrated by an event in January called "Fire Hose Day." Fire Hose Day went like this: The five indie teams sat at tables and are visited by six packs of six mentors. These include designers and programmers from Bioware and Ubisoft, art teachers, audio engineers, investors, and various consultants. They sling strong opinions left and right to the point of severe confusion. For the teams it is, as the name suggests, it is like getting blasted by a fire hose.

Personally, it seemed that the Montreal game designers frowned upon our free-to-play business model and didn’t see monetization as a critical part of the design process. In contrast, there were some small mobile studio owners that said we were definitely on the right track. As a company owner myself, I understand the importance of listening and choosing the best path forward, even if it contradicts some of what I’ve heard.
Although I still saw the road ahead quite clearly, that didn’t ring true for the entire Imaginary Games team. After Fire Hose Day, I found that a portion of every week is spent trying to convince our team that we do not need to do what some of the mentors suggest. Of course, I understand why team members would question my vision over AAA game design veterans. Most days, I feel that this “team challenge” strengthens our project, but on some days I just feel exhausted.

Meeting mentors and the entire XL experience is also helping Afterland gain visibility and traction. We have been getting hundreds of likes on our Facebook fan page (facebook.com/imaginarygames) and there have been several press articles that include images of our cards. We have connected with likeminded game makers and we just launched our first crowdfunding campaign on Kickstarter! ( http://www.kickstarter.com/projects/1400657451/afterland ) Members of the CMF, the fund that didn’t give us money, come to the Labs now and then as well. My bruised ego wants to ask them to tell me why their application that took close to three focused months of hard work made little impact. The CMF could still be a viable option in the future but I look around our studio now and feel that the Labs have been able to give us a much better deal.

Based on our needs the XL has been a good fit for Imaginary Games. They fund operations and give expert guidance that will allow us to deliver a better game. Would it be the same for every indie dev? Probably not. Indies need to be aware that their game vision will be shaped and influenced, not everyone’s cup of tea. Also, due to the time invested in team building and process, the most effective spin-outs will likely be groups that had a long-term plan in mind when they arrived. Lucky for us, Imaginary Games is in this for the long haul and our story will continue when we release Afterland this Summer.



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