Self-Funded Game Development

by Darius Kazemi on September 7, 2005

in Uncategorized

First of all, if you haven’t read Greg Costikyan‘s new series of articles, Death to the Games Industry, do so. (Part I, Part II.) Yes, it has been established that I am a fanboy of his, but at the same time, I think it’s for a good reason. So read those articles! In Part II, he says that developers

should try to fund their own development. If you can fund your own development, you get some big advantages. First, you can negotiate a higher royalty rate with the publisher, because they have less capital at risk. Second, you are not utterly at the publisher’s mercy during the development process; if the publisher-side producer wants you to do something really stupid (and horror stories abound), you can tell him to screw off. And third, you can retain ownership of your own IP, so if you build a successful franchise, you (rather than the publisher) reaps the benefit.

What’s interesting about the insistence on self-funding is that in the serious games sector, there has to be an emphasis on developers obtaining funding themselves. Costikyan suggests VC or Hollywood-style funding models, but the serious games people I’ve spoken to follow the contracting model of government funding. It’s slow, but you do get the cash if you get the contract.

I’m waiting for one of the few companies that do both commercial entertainment games and noncommercial serious games to apply some version of the alternative funding models of the latter to their mainstream titles.

(Oh, by the way, The Escapist magazine is really good.)

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