How to make money from social games: Become an employee

The goldrush is still on for social games, and employees seem to be the biggest beneficiaries.

That’s the message from Vonchurch, a specialized recruited that has placed 120 candidates in social games companies since September 2009, in an interview with Inside Social Games.

There is some inherent bias in this story. Vonchurch says “it’s a seller’s market” and that means that their biggest challenge is to find new candidates, not new clients. So it is in their interest to talk up potential salaries and remuneration to get more inbound calls from candidates.

Even so, there were two big take-aways for me

1. Employees are getting *a lot* of reward

Vonchurch says that the average salary for someone it has placed is $95,000. More specifically, people with expertise (not even very much expertise) can command high numbers:

• Flash engineer, mid-level: $90,000 – $115,000
• Flash engineer with social gaming experience: $150,000
• Front-end web developer: $120,000
• Product Manager: $115,000
• Artist: $65,000

In addition, 98 per cent. of placements received equity. And money isn’t enough: employees want perks and to work on cool interesting games, not just Farmville clones.

2. Employee retention is becoming tough

With this explosion of salary levels, so employee retention is becoming tougher. Vonchurch refer to the “Zynga effect” which they describe as:

Candidates are ready for an environment where they are no longer a number within a mass organization. They want some semblance of work-life balance. They want a larger contributing piece to the project they are working on, and they want a project that is going to be unique and not a replicated version of a Farmville.”

Of course, there are many developers who view Zynga as all that is evil and cynical about social games, but you can’t deny that they are phenomenally successful and for existing employees, a potential route to fabulous wealth.

But, if even Zynga, with its massive franchises and rumoured high profits, is struggling with retention, it will be tough for everyone.

Making social games is about to get really expensive

The bubble for social games is great news for anyone who can make them (anyone who remembers the dot com boom will remember what a wonderful time it was to be a young tech-savvy marketer, commercial web person or developer).

It’s bad news for companies. More downwards pressure on margins and a real challenge of human resources.

If you’re going to make the leap as an employee, though, do it soon. Supply of social games developers will eventually catch up with demand, and then salaries will fall again.

Which is better news for companies than coders.