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Five lessons for a successful indie games business

By on September 11, 2013
Creative commons image by Tristan Martin
Creative commons image by Tristan Martin
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This is a guest post from Elaine Heney of Chocolate Lab Apps.

The news is of full of stories of app millionaires who went from zero to hero overnight. But the real truth is something quite different. Believing that you can quit your job, invest heavily in your first game and expect to make serious money is dangerous.

Being an entrepreneur is part of my DNA. I empathise completely with the unrelenting drive needed to start your own business. This drive is a part of who I am.  And I think most entrepreneurs share this passion with me. I have worked for other companies in the past, but I never felt that euphoria and exhilaration until I was running my own successful games business.

However I have seen a lot of people struggle with financial issues when starting new games companies. Making apps for yourselfis a completely different beast to being part of a team in a well-established games studio. Working in a large studio is a fantastic experience. You get to learn a lot and really focus on your job. If you are a programmer, you program. If you are a UI designer, you design the UI. Everyone knows what their job is and usually everyone does it really well. Quitting your job in an established company to start your own games business is like emigrating to China – foreign, unfamiliar and very different to what you were used to.

1: Business success vs. passion

Starting an app business is tough. To build a business, you have to focus less on what you love and more on choosing to do what will make you money. A passion is something you spend time on because you love it. You decide what to create, and then you get completely involved, building and analysing every detail until it’s as close to perfect as it gets. You spend five hours designing the perfect button. The journey becomes more important to you than the end result. You get sucked in and you don’t realise it. Passion is great but it doesn’t work as a primary driver to build a sustainable business.

2: Abba were right — it’s about the “money money money”

A business only works if it’s profitable. It really is all about the money. That’s the harsh reality. Forgot the glory, the awards ceremonies and being the envy of your friends. When you begin your target is to get on the right path to earn money. This means one word: SHIP. Every game you ship to the store is another opportunity for you to earn money. Building a game will not earn you any money. Shipping and publishing a game will.

Spend very little. You do not need a lot of money to start a games business. Instead you need to figure out how to do things cost effectively. A major way to do this is by buying existing code. This is both faster and a lot less expensive than making code. Studios of all sizes are doing this – it’s not just an indie thing. Why program something new when it exists already? You can buy code from $50 up to thousands of dollars, the choice is yours. Then you can adapt this code to fit your exact requirements.

Forget about your ego. Your friends cannot accurately predict if your game will make money. When demoing your games, don’t believe what people tell you. If you show someone your game, 99% will say it’s great. They want to support you. Plus it’s awkward to tell someone their game looks terrible when they are standing in front of you.  Fake praise is dangerous to your business. The best idea is to show your game to an accountant. He’ll ask you how much you’re earning.

In terms of earning money, I truly believe the best people to get money from are your customers. A great way to prove you have a viable business is to have people who want to pay and use your products. VC funding does not prove you have a viable business and I’ve seen it become like a cancer in businesses.

3: Education

Many people quit their jobs in large game studios to start making their own games. If you can make it worth there is nothing as rewarding as being your own boss. But there are new challenges you now have which you have to acknowledge and address to be successful. You are no longer working on games built around massive brands. No one knows who you are. No one knows you are making a game. You can’t depend on the ‘build it and they will come’ approach. Hoping for the best will not work (I tried!). What does work is market research. Choosing the right theme can make or break the sales of your game. Do not build what you love. You must build what will sell.

Your team consists of one main person – you. You do not have access to expert monetization, game design and analytics experts anymore.  So you have to learn how to do 50+ new jobs in order to publish 1 game. You have to become a UI expert, art director, QA lead, marketing expert, engineering lead, data analysis consultant, monetisation specialist and a LOT more besides. This leads to two issues. To be successful you have to recognise you need experience in these new roles. You get this experience by shipping a number of small games and learning on the job without losing too much money. Secondly, you can’t publish a big game in a short time frame with a team of one or two people. Big game studios can make big games because they have a lot of staff. Indie app developers and publishers need to focus on what they can create and ship, in a 2 week to 3 month period max.  These will be smaller games. You make money when you ship a game, not while you build it.

You need to focus on building a portfolio of apps. You do not want to risk all of your time and energy on just one game. That is a high risk strategy.

4: You need to hire an artist

It’s all about the visuals. Your game has to look good. Open any of the app stores. Look at the games that are doing well in all of the charts. What you will see in 99% of the apps is that they look AMAZING. If you are starting an app business and you are not a graphic designer, I would strongly argue that to massively improve your chances of getting downloads your app has to look INCREDIBLE. The good news is that incredible does not have to cost a ton of money. There are lots of artists on outsourcing sites like oDesk that will work for between $8 and $15 dollars an hour. People will judge a book by its cover. If you app / game looks incredible, people will assume that it was made by a really high class games studio. They are more likely to assume it’s great and download it too. We judge things visually.

5: Time, focus and hard work

Your time is precious. There are a TON of game and app companies out there that will let you use their software or code for very little – or for free. If you have an idea for a feature you would like to put in your game, spend 30 minutes googling it. Want to cross promo your name? Use Chartboost.com’s free solution. Want to use multiplayer? Check out Nextpeer.com. Want to publish your game cross platform? Use Unity 3D or cocos2d-x. Do not spend months of your time reinventing the wheel. Do not build a game engine.  Neither will earn you money.

Anyone who is successful has worked really smart, and really hard. There is no such thing as luck. Everyone has demons and doubts, bills to pay, and often a family or full-time job that means that their time is limited. Look on these as opportunities not as drawbacks. Have limited time? Spend 30 minutes right now googling how to find tools, people and software to help you publish faster. Have limited money? Learning from lots of great blogs like this one about how to design, make, market and publish apps by yourself. I had no technical background but because I had very little money at the start I taught myself how to do the basics in xCode so I could publish apps without paying a programmer.

Right now I don’t earn money any more, I make money. What I have done is not some crazy secret ‘voodoo’ stuff. I keep my costs low and I made small games to learn my trade. I kept shipping and I learned on the job as fast as I could. Now I can make bigger games and still make money. I love what I do, and I am lucky to be able to help others with their businesses as well.

About Elaine Heney

Elaine Heney is CEO of Chocolate Lab Apps, and #1 bestselling author of the ‘App Escape Plan’ and ‘App Marketing’. She has over 180 apps published, 3 million downloads and 5 online App Development courses. Get the Express, a unique, totally free program for increasing your app downloads at www.thechocolatelabapps.com. Contact @choclabapps
  • Juan Marco

    Not sure this is an adhominem attack. He’s rather polite. He’s more so questioning the author’s authority to give advice. And it looks like he’s put a bit of research into it.

    App flipping is a way to make money. But maybe not the way most indies want to go about it.

    Anyways: Ad hominum attack on authority or credentials.

  • Emily Edwards

    This is a great post with some sage advice — especially the bit about hope not being a good strategy! You can have the best cheese in the world but it’s all about the mouse trap. Here’s another good article about how to market indie games: http://www.clickbitz.com/blog/how-to-market-indie-games/

  • Dori

    Agreed.

  • Dori

    Interesting post with lots of good comments to read into. Thanks everyone in these forums and Elaine for your expertise and tips.

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  • I see that Edwin’s point has validity for Edwin. For everyone else, I think pontifexa’s advice is better.

  • pontifexa

    Nevertheless, you’ve spent an awful lot of time following up on opinion from “nobody important to you”.

    Although I personally think software patents are an abomination in the modern world, and it sounds weird that your business model involves patenting algorithms based on OTHER PEOPLE’s research papers, I wish you the best of luck with your “algorithms” – I hope that works out well for you.

    For EVERYONE else reading this and NOT on government funding or tax incentives… consider carefully which business advice makes sense for your situation.

  • Edwin Zeng

    Look, I do not care about what you said or what you believe it.

    You are wrong because my focus is on algorithms. Your mentioning of all those low level stuff is nothing much compared to what algorithms are. Pre-built systems do not have my algorithms or the algorithms from a set of research papers that I have read. So all these pre-built systems are useless to me.

    Except for specific open-source systems which I reuse if I need to, and they are also mainly research-focused (even Box2D is based on the results of R&D).

    An innovation in the tech space can be used in the game and design space, which I do not discriminate. Also an innovation in the tech space can open up new game and design spaces that were previously thought impossible.

    Also a simple fact that you did not take into account – A developer has to make use of whichever incentives their government provides them. I do my innovation from my country and that is different from yours. And I also get tax incentives from doing innovation in my country. So I utilise Research and Development to my advantage. Everything else you mentioned is nothing at all to how my country defines R&D and IPR.

    Lastly, I DO NOT NEED to show you what my innovation is because you are not my government. You have no right to see or read them.

  • pontifexa

    It doesn’t matter whether your name is EA, Rocksteady, a large independent body such as Insomniac, or some dude in his parents pool house.

    You customers won’t give a rat’s whether your game is built in C#, C++ or Blitz Basic. If you’re writing your own low-level input handling for god knows how many platforms, or designing yet another graphics API abstraction layer, you’re wasting your time. Those can be bought for a pittance these days, Unity being only one of many offerings.

    The fact the you now reference Minecraft seems to suggest being a little out of touch with reality. Unless your name is Persson, you’d do well to focus on the other 99.999999% of the industry where probability dictates that your product will forage.

    I haven’t seen anyone claim that you are unable to innovate. (On the other hand, I haven’t seen any proof that you are, in fact, able either). Either way, innovation happens in the game space, not the tech space. We all know perfectly well what the hardware commonly available to indie developers is capable of. What matters is how you put it to use.

    The sad reality is that most games never make it to market. If you don’t make it to market, you certainly won’t make it into the top 100. Any upper hand you can get by shedding a few quid is well invested money. This basically boils down to “1. Business vs Passion”.

  • Edwin Zeng

    EA is not indie, so your examples are wrong too.

    And if your game is shipped and doesn’t sell well, then I dare to question what is the point of using pre-built systems? If you want to buy a pre-built system, make sure it has ALL the features that you need. So if a system does not have the features that you need, you cannot even make the game in the first place. You don’t need to even talk about shipping it, you cannot make it if you do not have the required features!

    In any case, I dare to say that there is PLENTY of engine development found in Minecraft and Starbound. And I also dare to say that existing pre-built systems DO NOT have the stuff that I need.

    Lastly, you have not read the above comments properly. You are expected to make use of whichever incentives your country allocates for you as a developer.

  • pontifexa

    This is VERY dangerous “advice” to come across for budding developers.

    By definition, the hours you spend as an engine developer, are hours not spent as a game developer.

    Are you gonna tell the boys at EA that they shouldn’t be using Frostbite for anything other than Battlefield 4? Or that the accumulated 11 million copies Rocksteady sold of Arkham Asylum+City using the Unreal Engine would have been much greater had they first spent a few years on their custom technology?

    “can you guarantee you can sufficient innovate and out innovate others, and break into the top 100 charts”

    No.

    Not if you use a pre-built engine, NOR if you build your own technology. Nobody cares which tech you use. The stuff you put into your game is what matters. In buying technology, at the very least you’re giving your game a better chance of actually shipping. Contrary to popular modern belief, if you aren’t shipping games, you’re not a game developer.

  • Jjthejjj

    Ad-hominens and snide remarks notwithstanding, you are promoting an idiot (and dare i say sheister) who’s views on “game development” are without merit. She is a hipster blogger marketer- not one area of her background belongs in games. So you you tell me- idiot or genious?!?

  • Dante

    “I don’t earn money any more, I make money. What I have done is not some crazy secret ‘voodoo’ stuff.”

    Really? So I guess if we had the same voodoo as you doo, we would doo doo so well? Oh how convenient…you sell your voodooo online! Anybody from the online marketing machine that is Trey Smith and or Chad Mureta ends up being a spammer often leveraging their numbers not to grow their app business but to sell info products.

    My rant aside, the metrics discussed on this site only really matter if you have a solid game with solid mechanics (regardless of what engine you used). if you have regurgitated code done up dozens of times, you are making your money on the front end through ads just as spammers

  • But I stick to my point that evaluating advice is more useful than snide ad hominem attacks. People’s backgrounds are important, but the content of what they say is more so.

  • “If you were a true dev”? Is like being a true believer?

  • Jjthejjj

    Edit: chocolate labs not digital chocolate

  • Jjthejjj

    You sir are an idiot- she entered digital chocolate in 2012. Prior to that she did 2 apps between 2004-2012. Neither of which were games, or even profitable in the terms she uses to describe such. So questioning her credentials is totally on the table. And if you were a true dev, you’d know that.

  • Tim Conkling

    The ad hominem was lame. Apologies.

    I’m a recently-independent game developer, and I’m hungry for advice on business practices for indies.

    But not all advice is created equal; advice without proper context is worthless or worse. I visited Heney’s site to learn more about the context for the advice she is offering in this article – specifically, “business success vs. passion” and “it’s about the money money money.”

    The Chocolate Lab Apps website contains no information about the games that Heney makes. It does have a lot of ads for books and online courses that she has created. Prominently featured in the sidebar of every page on the site is an ad for a 5-pack of her courses, which are being offered in a “limited offer sale” for $997. Course descriptions are accompanied by a large number of 5-star reviews from supposed users – first names only – who say things like “Uploading an app to itunes is so easy! Who knew?”

    My assumption after having browsed the site are that Heney’s business seems to have nothing to do with being an independent game developer, and is instead about selling books and courses. I could be wrong, of course. But the assumption colors all the advice on offer here, the motivation for which seems to be about *selling more advice*, at very high prices, in a manner that is very similar to dubious get-rich-quick schemes you can find all over the internet.

  • Per Haglund

    Elaine’s advice is sound. Under “Education”, I would recommend anyone who is just starting out to in this business to see if you can help someone who is already in it. They usually have a lot of ideas, but not enough time to execute all of them. You won’t make much (or anything) but you can learn a lot.

  • Edwin Zeng

    Conclusion, I would prefer to build my own system and integrate open source solutions in which the overall objective is to specifically focus on user engagement that allows entering the top 100 free charts.

    The procedural content generation genre just happens to be one of them inherently having a lot of user engagement through many or multiple core loops. Which in turn allows better opportunities for video sharing, long gameplay sessions, lengthy forum discussions, good ratings and reviews, new player awareness and acquisition, retention of existing players, etc.

    All these is not done for nought as the ranking algorithm is now focused on using ratings besides download numbers. Download numbers are also now scrutinised for anomalies.

  • Edwin Zeng

    I believe I have not responded appropriately to your point on player acquisition. So here are my views solely on this topic.

    The chart for Free apps is now totally different, as we start to see apps that are commonly used everyday on the top right now as opposed to all kinds of random app downloads as before. Productivity and utility apps are now the majority of them (Vine, Youtube, Instagram, etc), instead of entertainment or game apps. That speaks a lot on user engagement.

    So that means that the games in this chart are now the ones with a lot of user engagement. It is now easy to infer from the chart. Candy Crush and Clash of Clans are still there. “Where’s my Water 2” has been released a day ago and now is in this chart. We now know people are playing these games instead of others and what kind of games now acquire and retain players more easily than others.

    Previously, I noticed that there were a lot of backend services for app installs, or paid downloads, or cross-promotion sharing. I tend to believe the 3-hour downtime before the ranking is updated, has an automated solution to weed out chart manipulators, be it legal or illegal. Download numbers for sharp spikes in player acquisition are probably removed and so are those numbers acquired from app installs as a result of “marketing services”. Even if it is just doing innocent cross-promotion, it can still be affected. Hence, the effective download rate can be lower than expected.

    Instead, user-to-user sharing through social media is encouraged within the app or even app sharing through wifi between friends. And possibly others. (I have to yet to figure all the possibilities, but I want to know them eventually). How much a player shares is probably now a good consideration for customer acquisition. So, the more the app engages the social media has a higher chance to rise in ranking. Eventually, more people will get to see the app exists, and some of them becomes acquired.

    So what are the kind of games that are on the way out? I believe from my observation, are those with only a SINGLE core loop with little or no emphasis on user engagement. Hence, they have little or no social media sharing, and their users spend not much time during their app gaming sessions.

    I would still prefer to give the Free chart some time to adjust itself. And nobody really knew what Apple was thinking anyway. Maybe I am right. Maybe not. But I am very glad the Free chart is now the way it should have been three years ago. 🙂

  • Edwin Zeng

    I get your point. I did not opt for a single-app only strategy. Nor I somehow did not bother about how the chart ranking changes. I understood what some people wanted to play and I chose to capitalise on that.

    Also, I just prefer walk a different path as compared to other developers I think. And I know why I need to walk this path which all other developers would probably pour scorn on it.

    So, I deferred any app shipping instead to build infrastructure that allows for scalability and user engagement first. Then, I will have my series of apps, shipped one after another. Explained further in the post below.

    I actually operate on a minimal cost strategy, with no other manpower costs. No artist. All art is generated initially from a combination of innovation and existing technical solutions.

  • Edwin Zeng

    One of the reasons I forgot to mention was that my observation happened to focus on several popular indie games that do not use existing systems, since they allow procedural content generation. (eg Starbound) So that weighted in my explanation.

    If you can build innovation into existing systems, then that is good for you. But lets just say that when I started with my own system which was a few years ago, I knew having lots of fanciful high-end 3D graphics would be a dead end for many developers, so I ended up integrating some middleware first (eg Box2D, noise library, etc).

    So it appears that I actually did built some amount of innovation around the middleware such as physics, procedural generation and others. But I wont do the same for Unity nor Cocos2D, because I use a customised graphics system that neither of those have. So I stayed flexible and integrate only the stuff that I need.

    I am actually attempting the MVP-approach with respect to building systems. The objective is to test some of the features initially and scale eventually, while keeping differentiation in check.
    Somewhat like the way how Minecraft and other procedural content generation games were initially developed.

    For the short term, where features are incomplete, this approach will not allow the app to immediately reach the top 100. I actually took this into consideration. But this approach allows for scalability of mechanics, so it allows an increasing chance to reach the top 100 with each app that builds its minimal content over it.

    I do not ask for direct nor immediate access into the top 100, but rather an opportunity to increase the chance with each app shipped.

  • You can evaluate the advice on its basis 🙂

  • My basic position is that the prize in the long term goes to those who learn fastest. I optimise for learning fast. I think a newly independent game developer needs to ship. That is the single most important thing.
    Over time, maybe your own game engine makes sense, but first you need to learn how to ship.
    Unless you have oodles of money to burn.

  • Andrea Keil

    “Ask yourself this question, if all you do is to use Unity or Cocos2d, can you guarantee you can sufficient innovate and out innovate others, and break into the top 100 charts?”

    Counter question: If you create your own engine, can you guarantee that you will make it into the top 100 charts? (and stay there)

    Put differently: I disagree with you. You can be innovative as well using existing engines, even considering the fact that you can implement stuff on your own INTO those engines.

  • Andrea Keil

    Well, the fact that you find nowhere names of the 150 apps that she made is the “piece of advice” that he criticizes: “How can you trust a person if you -in the end- don’t know what he/she got successful with?”

  • Edwin Zeng

    1) Having a lot of great art and animation cannot alone get an app into the top100. Its the mechanics that allow user learning (pedagogy) and engagement. Hence, then the players will enjoy and have fun.

    Reference: Raph Koster, Clash of Clans

    2) Anyone who can build an engine, can easily integrate networking capabilities. Those are not issues as there are already backend service providers with those services. Essentially, everything else that does not provide value for user engagement should be prioritised later.

    I also noticed that the chart ranking has changed a lot recently, with reports that user engagement is now going to be a key factor.

    3) The fact is that it is already a red ocean for a lot of developers. What is the point of releasing anything that sails in the red ocean and cannot reach the top100? I rather sail in the blue ocean.

    No matter what the solution is, the developer will still want their app(s) to reach the top100. Can you guarantee that by using an existing system? I cannot, so I choose to innovate instead.

    Reference: Blue Ocean Strategy

    4) I actually understood that you are very knowledgable in the areas around F2P. But you did not fully understand why user engagement will continue to be even more important and how it be used as a key differentiator among all other F2P games.

  • Tim, rather than ad hominem attacks, perhaps you could explain which of the pieces of advice that Elaine gives that you disagree with.

    That would be more useful to readers of GAMESbrief and indie developers.

  • Edwin, I would suggest that if you build your own engine (something that I agree is unnecessary), you are failing to spend the time learning about all the things that you don’t know how to do: submit to the AppStore, draw great art or animation, implement GameCenter or other friend networks, build analytics, respond to analytics, acquire customers and so on.

    You say that by not building a game engine, you are unlikely to make it into the top 100. I say that if you are an indie game developer, if you build your engine, you are unlikely to release a game at all.

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  • Tim Conkling

    What the what? What are the games that Elaine Heney has created? I went to thechocolatelabapps.com and could not find mention of a single game (or app, for that matter) – just a lot of ads for her books, and a bunch of statistics about how great these nameless apps have done on iTunes.

    The sense I get (and if this is inaccurate, I apologize to Ms. Heney) is that Heney is engaged in a “ship a ton of outsourced, low-quality garbage apps” business. How else to explain claims of “150 apps and games published in 12 months,” without a single mention of what those apps and games are?

    What’s the intended audience for this post? Is it truly indie developers? Or is it aimed at those looking to Get-Rich-Quick!!! by following some Tim Ferriss-style guide to producing crap?

  • Edwin Zeng

    “Do not spend months of your time reinventing the wheel. Do not build a game engine. Neither will earn you money.”

    If you do not build a game engine, you will not be at level of “Where’s My Water”, where specific features done for the purpose of disruptive innovation, actually enabled it to enter into the top 100 charts and beyond.

    Ask yourself this question, if all you do is to use Unity or Cocos2d, can you guarantee you can sufficient innovate and out innovate others, and break into the top 100 charts. I actually laughed at all the people who simply just sing praise to any pre-bundled engines, when they did not realise that disruptive innovation is actually what they need in order to enter the top 100 charts and STAY and RISE in that chart.

  • Sik

    “The best idea is to show your game to an accountant. He’ll ask you how much you’re earning.”

    Er, I’m not sure accountants are the best guidance, they usually aren’t into games and if they’re it’s usually casual games (which means you’re screwed if you’re aiming for something else). I’d rather pick up somebody who knows about marketing, at least that person would have a better idea of what can get players to spend money in my opinion.

  • Kevin Corti

    Good post! A hearty dose of realism that is accurate and positive. Too many new games teams – particularly in the mobile world – jump straight into building a passion project with almost wanton abandonment with regards to how they are going to make money. Building a good product is – with rare exceptions – unlikely to be good enough anymore if the goal is to be able to financially sustain yourself, let alone be uber successful. For every Mike Bithell there are most like a thousand game makers who, after a year of no income, then face the choice of either going back to FT employment or turning to work for hire. Being independent is doable but not without putting equal effort into getting to market and exploiting that market, even on a small scale. If you are not prepared to make decisions from a business standpoint then don’t start a business.