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The Secrets to Start-up Success

Mon 25 Jul 2011 7:00am GMT / 3:00am EDT / 12:00am PDT
Development

Media Molecule, nDreams and Mind Candy share advice for new studios in a digital age

Media Molecule

Media Molecule was founded by a small troupe of Lionhead veterans who, bolstered by their work together...

mediamolecule.com

Media Molecule, nDreams and Mind Candy. All successful companies in a new era for the video game business, creating successful and innovative products for targeted markets, and each with a very different path to success.

Speaking exclusively to GamesIndustry.biz, all three shared their experiences and advice to developers looking to form their own start-ups, where a great idea is just the beginning in the ever-changing and disruptive new games economy.

Mark Healey and Kareem Ettouney are two of the four founding members of Media Molecule, creators of the ground breaking title LittleBigPlanet. The game has been massively successful, with players using the franchise's tools to create and upload over four million levels over the past three years. Media Molecule was acquired by Sony in 2010.

If you're going to do a start up with a bunch of other people take it for granted that you are going to hate those people at some point

Mark Healey, Media Molecule

Both men were actually with Lionhead when they decided to form their own studio, which was originally called Brain Fluff. At the time, Healey was already developing his own, one man project – Rag Doll Kung Fu - in his spare time.

"If I was starting out today I would make my first project quite small, just to go through the process," said Healey, who admits part of the driving force behind Rag Doll Kung Fu was a desire to annoy his programmer colleagues.

"I know Alex [Evans] would probably say something different," he admits. "Alex would probably be like 'no, f*** it, just dive in and aim big.' Personally I would do it with something small first, just so you get the experience of starting and finishing, localising and doing all the stuff that you probably aren't aware of."

Ettouney meanwhile suggested looking after the more creative members of staff was essential to a productive team. "A big part of the investment, in my opinion, other than doing the good work and the creative work, is understanding how to work with creative people."

"It's kind of like an entertainer by craft, a person who does something and gets their kicks from the happiness that comes as a result. So if they're not getting that their cycle is broken and they get weaker and weaker. So it's important to remember these things and not just be completely objective."

You should also expect and prepare to handle disagreements. Healey especially remembered times when the close team struggled to get along.

A big part of the investment is understanding how to work with creative people

Kareem Ettouney, Media Molecule

"If you're going to do a start up with a bunch of other people take it for granted that you are going to hate those people at some point," he warned.

"A lot of start-ups probably fail at that point, they'll have disagreements and then go their separate ways, but if you can accept that that's actually just part of the process, and you work through it, that's what separates the men from the boys."

While Media Molecule had the support of Sony, neither Healey and Ettouney believed that the backing of a big publisher was essential to a start up's success, but did suggest finding someone with a business mind to help with commercial matters.

"It's something as game developers we're pretty useless at, I think," Healey admitted.

Media Molecule eventually signed up with Sony and received their support with some of the more corporate processes, but at first worked with [FreeStyleGames founder] Chris Lee, who helped with both the economic and business realities of setting up a studio.

"That's very useful, because they can be responsible for making sure that you don't have to think about that side of things."

Ettouney stressed the importance of house keeping and paper work too. "If you don't have that side well looked after the company gets vulnerable as well. So more important than having the support of a publisher is having a complete band that has a sort of drive and craft."

As a UK industry we need to spend more time sharing information and helping each other out

Patrick O'Luanaigh, nDreams

"It is hard because you need somebody to finance it and you need some kind of real world scenario to be able to survive," he admits. "But we know a lot of people that managed to last for a long time in a very independent set up."

Perhaps surprisingly for a company that has spawned a thousand bedroom developers with its game's innovative tools, both spoke about the importance of a background in game development with bigger studios, learning the process and improving your skills. All of the team already had a strong foundation after years of work in the industry.

"I like independent culture but I don't want everything to become like The X Factor," explains Ettouney.

"It's like 'I'm not going to do anything, I just want to hang out with my friends and find a deal! Sony, come on, can you finance us?' That's a bit wishful. You've got the odd genius that's 15 and unbelievable, but most of the time I would recommend actually to somebody young to go and work somewhere. Learn a bit."

There are other approaches to teaming up with a big publisher. Hampshire studio nDreams also signed a deal with Sony, and launched PlayStation Home's very own ARG, Xi in 2009. It attracted 600,000 users, and nDreams continues to create spaces, items and games for the virtual world, recently launching Aurora on the platform. CEO Patrick O'Luanaigh believes there's never been a better time to form a new studio.

"There are lots of new start-ups at the moment, I've had meetings with a few people, developers, and they sound quite big and you go and meet them and it's one person and a couple of freelancers helping them out," he said.

"If I can see a single person who hasn't got any experience but they've got passion and some brilliant ideas, and they're really willing to put the effort in and work, then I think we'd work with them."

He suggested starting small, finding the right rather than fashionable platforms, and keeping a tight rein on expenditure.

"Keeping your costs low means you don't have to sell 100,000 copies just to break even, or a million copies, or five million copies in the case of console games."

"Join TIGA as well. There's lots of small new publisher, new developer forums and casual game groups where we go and share idea and talk about stuff. Or just meet up with other developers doing similar things, you might find that that makes sense. As a UK industry we need to spend more time sharing information and helping each other out."

O'Luanaigh also spoke about the importance of finding a niche like table tennis or football management, as a surprising recipe for success. He pointed to Railsimulator.com, the creators of RailWorks as an example of catering to a dedicated audience.

"It's not terribly glamorous but you know what? These guys have got a captive audience, EA aren't going to come in and pee all over them, they're in a great position and they're making a lot of money. So I think either in a genre or a platform, find your niche."

Mind Candy is definitely a company that has found its niche. It's founder, Michael Acton Smith, a charismatic entrepreneur in snakeskin boots, jumped from online retailer Firebox, to ARG Perplex City before creating Moshi Monsters, an MMO for children that Acton Smith describes as "Tamagotchi meets Facebook." In June it announced it had reached 50 million registered users.

The broadcasters and the film studios, the games publishers, the historical gatekeepers – their power is diminished

Michael Acton Smith, Mind Candy

Despite the fact that at one point Mind Candy teetered on the very edge of bankruptcy, Acton Smith has nothing but encouraging news for new studios, and argues that you don't need your hand held by the big publishers or platform holders any more.

"I think this is an amazing time for indie developers to be building and experimenting," he told GamesIndustry.biz.

"The broadcasters and the film studios, the games publishers, the historical gatekeepers – their power is diminished. No longer do you need to get their seal of approval to get mass distribution. You can come up with an amazing idea with a relatively small amount of money, put it out with Apple on iOS or launch it as a mini Flash game and wait to see if there's an instant connect. If there is then you can raise money."

Moshi Monsters has expanded from a browser game to an entertainment brand that produces books, toys, a Nintendo DS game, and soon, television and live events. It's now worth around £125 million, and was originally funded by investors, something else that Acton Smith says new indie developers should feel confident about too.

"I've never seen a better time to raise money either. There's a lot of people wanting to invest in exciting internet properties and I still think there's tons of opportunity in gaming. Particularly the more sophisticated investors, they've seen how well Zynga has done and they've seen this freemium model work so well in non gaming websites."

So the message for developers looking to go it alone seems to be start small, make sure you pay equal attention to your creative team and the vital business part of the start-up, and don't be afraid to seek out new investors to help fund your projects.

10 Comments

@ Patrick. Another example would be Eagle Dynamics who produce the DCS series:

[link url=http://www.digitalcombatsimulator.com/
]http://www.digitalcombatsimulator.com/
[/link]

Very niche, but they seem to do extremely well. Thirdwire are another.

Posted:3 years ago

#1
The only other thing to add is, when you enter and decide to make the plunge, be prepared to tough it out the first 3 years. Much like a game level, the obstacles, challenges, prize money ramp up with each layer and chink of armour/experience gained. And the rest is a perpetualjuggling act everyday, every breath. but the rewards and satisfaction can be exhilarating and anxiety filled all rolled into one - but as masters of your own (relative ) destiny. Wouldn't have it any other way!

Posted:3 years ago

#2

Rickard Edén
Founder and CEO

1 0 0.0
Thanks for an inspiring article.

Yes it takes a while to get going. I'd advice anyone starting out to try and save up / cut costs so that you can make it at least one year without _any_ salary.
Sure, you might make money the first year, but like Chee said; the first 3 years will be tough, and will most likely eat into your savings account. Having a pile of cash in the beginning will make you sleep better at nights, and what would be worse than having to stall (or even abandon) your project at 80-90% completion because you're out of cash?

Also be prepared to use your skill-set(s) to do other things than games. Running a company is very much like a survival situation; Gather, gather, gather. You never know how long your resources will last, or what will happen in the future. Grab the opportunities that appear, and try to create some yourself.

Posted:3 years ago

#3
And dont spend or resist the instinct to celebrate with a mini splurge with the first few paychecks.
Its a lifelong marathon, and the best instinct is that of

1/ a squirrel hoarder
2/ be consumerist for everyday products, media, stationary, post - if you can find a good price at wholesale, online or alternative, do so.
3/ the bills eventually escalate every week/month
4/ its easy to find more mouths to feed than the manpower you really need. (i.e fast growth startups, max out their growth early on by expanding too fast, expanding too fast. Dont expand unless you need to)
5/ Have a good personable accountant to teach, help learn the legal/biz side of the accounts.
6/ Learn about IP, patent trolls, international licensing and the convoluted EU rules of payments, VAT. Its horrible. its messy, but all part of the charm (when you start up, there isnt anyone else to do it. its your job now. muah haah)

Posted:3 years ago

#4

Jas Purewal
Solicitor

35 0 0.0
@Dr Chee Ming Wong - thanks for that last comment, it's always nice to have someone else point out that learning about the legal and financial aspects of a startup business is a key to success!

Posted:3 years ago

#5
Good article with a few insights I'll bear in mind.

Posted:3 years ago

#6

Nicholas Lovell
Founder

187 175 0.9
@patrick To be fair to Kuju, they build Rail Simulator, then hived it off into an independent business

Posted:3 years ago

#7

John Hanrahan
CEO and Co-Founder

3 0 0.0
Great read! Great article! Great advice! I'm actually on the service side of the industry rather than development but the same principles still apply to start-up success :) Thanks for sharing!

Posted:3 years ago

#8

Tim Carter
Designer - Writer - Producer

562 311 0.6
The future is in individual core talent.

Studios are transitional and temporary. The only thing that lasts is actual talent - i.e. people - and the games they make.

A studio is just an empty shell. What counts are the people inside it. And those people can leave, come or go from whatever studio.

Richard Garriott had a joke that his studio was acquired six times by EA. They made a game, EA liked it and "acquired" the studio. The people, under EA, got bored and left (Garriott being among the first to leave). They then made another studio. EA liked what they made... The story repeats itself 5 times...

It's not the studio. It's the people, and the projects.

Games aren't mining or accounting. They are hit-based, entertainment.

Edited 1 times. Last edit by Tim Carter on 26th July 2011 1:25am

Posted:3 years ago

#9

Charlie Cleveland
Game Director/Founder

19 3 0.2
I dunno - I've been working with my partner and team for over 4 years and I've never hated any of them.

We have disagreements from time to time, but hate is totally different.

Edited 1 times. Last edit by Charlie Cleveland on 27th July 2011 9:32pm

Posted:3 years ago

#10

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