Starting an Indie Video Game Company: The Basics

by Kevin on February 3, 2015



Indie Game

Several decades ago, entertainment was essentially limited to physical sports such as football, basketball, and the likes. Nowadays however, most folks find entertainment without ever leaving their home. This entertainment lies in the form of video games. What used to be Sega Genesis and Atari has quickly evolved into Sony’s Playstation 3 and 4 and Microsoft’s Xbox 1.

If you haven’t noticed, the video game industry is perpetual in that it is always changing, adapting to the newest trends and technology. Because of this, there is no shortage in the number of innovators already making waves in the video game world; and of course, those that want to break into this hot new market.

However, wanting to create video games and actually taking proactive steps to do it are two totally different things. Unfortunately, most people don’t ever make it past the idea stage. If you are truly serious about developing a video game company, then there are a few basic steps you should abide by:

Register the Business

This is the first and most basic principle. You must register the business in accordance to your state’s rules and regulations. That also means you need to research the various types of companies that are usually formed. Most new video game companies are registered as sole proprietorships or partnerships. While these types of formations are often successful, any debt that is accrued will land solely on the shoulders of you and your partners (if any).

However, an alternative to this would be to register the company as a Limited Liability Company (LLC). This means that the company is its own entity, so any debt that is taken on is the responsibility of the company and not by you personally. Make sense?

Establish your Staff

While a sole proprietorship speaks for itself, for the most part you cannot create and maintain a successful video game company on your own. Most startup builds have an established team all working as cogs in one big machine. While you won’t need a 20-man crew to keep your head above water, you will probably need two to three other people to assist with business operations.

Think of what a video game company needs in the way of staff. You will definitely need a graphic artist or two to develop the visual components of the game. You will also need a programmer to make the game(s) operate flawlessly. Aside from the actual game itself, you may also want to hire someone to handle the company’s finances, marketing, and day-to-day operations.

Secure Adequate Financing

This is probably the most meticulous part of any business, video games or not. You will get a mixed bag of opinions on how much you need. Some would advise to have enough to sustain your business for at least six months. That might be asking a lot for some, but you do want to have enough to maintain your company through the first development, from start to finish.

It might be a wise decision to maintain a “day job” until you get your company up-and-running. That will provide a steady flow of cash should the company need it as well as give you something to sustain yourself on. You could also get a loan if you feel you are adequately prepared to handle it responsibly. Many lending institutions such as Dealstruck feature a small business loan calculator and other tools right on their site. Do some research on various financing options (crowdfunding, bootstrapping, etc.) and see if any sound feasible to you.

Develop your First Product

This step should be fairly obvious at this point; after all, you can’t expect to create a video game company and not have a game to showcase, right? Some video game companies have a head start because they were formed around a pre-conceived idea for a game title, concept, etc. If this is the case for, then let the development begin!

However, for those who didn’t form their company under such circumstances, you will need to conduct research to determine how to best create your first product. Focus groups, forum boards, and personal interviews are fantastic ways to dive into the head of a gamer to unlock what they truly want in a game. Naturally, keeping up with the latest trends in the industry will keep you update on what’s “hot!”

Exposure

Developing your first game is vital to the success of your company. Equally as vital though, are your marketing capabilities. If no one knows about your product, then how do you expect to sell it? Big-name video game companies have multi-national marketing teams operating on an endless budget. Unless you can tap into that valuable resource, you are stuck coming up with ways to market your product on your own.

Most new video game startups employ simple, but effective marketing measures. One of the best is to offer a free demo or download of your game. That will give interested parties a chance to play your game which ultimately increases the likelihood of a purchase. You could also contact websites, magazines, and other news portals to see if they would be interested in reviewing your game. The list is endless, you just have to figure out a marketing campaign that best fits your game.

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