I'd written this a little while back on Medium - before we'd talked to a lot of VCs, before we'd even realized we'd need to find a different model for raising money. But it's as relevant now as it was when I wrote it nine months ago (Wow, it's already been that long! That was even before Wonderspark was a thing. This was written when I was just thinking about what I'd be doing next, and it wasn't until about a month later that Wonderspark sprang into being. The last few paragraphs have been changed from "I" to "We" to reflect the change.), and worth revisiting.
In the process of pitching a new game development studio to folks, one of the pieces of feedback I consistently receive is that I need to be clearer about an exit strategy, because what investors are concerned about is how they’re going to get their money back (plus a significant multiplier). I understand the concern, but I think it’s absolutely the wrong question.
The main problem is that if someone comes to you and asks for money to develop games, and says that they think they can predict how the market will receive their game, and tell you how much money they think they can make, I think any investor worth their salt should politely tell them that they have no idea what they’re talking about. Or that their plan is stupid. You know, politely.
But the problem is that there is really only one way to create a game that has a predictable return, and that’s to model it off of existing games. Which is why there’s a huge flood of clones and pseudo-clones. Candy Crush-alikes, and Clash of (whatever else). But the market doesn’t need any more of these, and (with the dramatic exception of Machine Zone’s Game of War) none of these clones have had any lasting success.
I recently booted up Plunder Pirates, a game published by Rovio Stars, and recommended by Apple as something that’d show off iOS 8. 30 seconds into the tutorial, I deleted the game because for all practical purposes, was the same as Clash of Clans. I don’t need another game that is so similar to something I’ve already spent months playing and am tired of.
The problem with these clones is many-fold. Marketing is difficult because people are tired of the concept. They all look very similar, so standing out is hard. They’re also fighting hundreds of other clones that are all coming up at about the same time, and they’re all fighting for the same audience, which leaves the clones’ audience fractured, split many times over among a bunch of vaguely-different games, preventing any from gaining critical mass.
The other part of it, though, is that it’s just a lazy, stupid way to make games. Sure, you get a few predictable metrics, and you get to piggyback off of someone else’s success, but the biggest hits — Clash, Candy Crush, etc. — they weren’t clones of an existing hit. They were significant iterations on existing mechanics. Clash took a Farmville-like game & made it a competitive multiplayer experience. Candy Crush took Bejeweled and added a lot of juice, a social map, and a bunch of highly exploitative monetization mechanics.
But Clash isn’t Farmville+, and Candy Crush isn’t Bejeweled+. And yet you still see dozens of games a week that are (FLAVOR-OF-THE-DAY)+ some trivial thematic reskin or basic mechanic that doesn’t really add anything to the mix.
The next big hit is going to take some of the core elements of existing games, and then add something new that you’ve never seen before. Its metrics will look different than what’s already out there. How players will retain, how players will monetize will be unpredictable, and you will not be able to plan against it. So whatever financial model you’ve created is garbage.
The ONLY thing you can plan is to iterate as fast as you can, and react to what your game is telling you. You have to plan to build an organization and a team that:
1.) Knows how to create something NEW
2.) Knows how to react to a changing environment
That’s it. That’s your plan. THERE IS NO EXIT, because the exit assumes certain things that you cannot currently plan against.
But here is what you CAN assume:
1.) Your game will end up in one of three states: Unsustainable Failure, Marginal Success, or More Money Than What?!?
2.) Unsustainable Failure is the most likely.
3.) Marginal Success means that you get to try again, or iterate until you reach one of the other two results.
4.) More Money Than What?!? will result, at some point, in an obvious exit strategy that will be specifically dependent on the nature of the game, the nature of the landscape at some undetermined point in the future, and be highly context-sensitive, because chances are the business model of that success will be different than the business model of successes to date.
So don’t plan for an exit. If you’re going into games for the easy, obvious, or big money, you’re almost certain to fail, because you’re going to try to follow on other successes, and no one has succeeded that way. Instead, plan to create something new that no one’s seen before with a team that deeply and passionately understands creativity and fun from the player’s perspective, and knows how to iterate fast.
So if you ask me what our exit strategy is, it’s this: We're going to spend 100% of our time trying to make the best, most successful game possible. It will attempt to reach a very broad audience, it will have mechanics that are familiar and accessible paired with things that you have never seen before, and we will build an infrastructure that will allow us to iterate so fast that we cannot be fast-followed by anyone.
That’s the path we're taking. We couldn’t care less if there’s an exit in sight, and neither should you.