The Art Of Public Funding For Indie Games
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The Art Of Public Funding For Indie Games

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Held together with Yacine Salmi at the 2011 Indie Game Summit at GDC Europe.

Held together with Yacine Salmi at the 2011 Indie Game Summit at GDC Europe.

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  • independent game devmunichswimming under cloudsgotten prototype funding from state of bavaria
  • independent game devmunichastroslugs on pc/mac/ipadconcept and startup funding
  • Types of (Public) Funding (i. e. “What we mean is”) - Governmental Grants & LoansStartup fundsGames fundsArt fundsResearch fundsWe won’t talk about crowdfunding, indiefund and other alternative fundings. They are beyond the scope of our talk.We don’t have enough time to go into the details of each fund. But, there will be a list at the end with all the details we’ve collected.Discuss how public funds in general can help you make your indie games, and the various pitfalls to avoid.
  • Why is public funding attractive, and how can it be a valid alternative to “traditional” funding sources such as publisher funding and investors
  • It gives you “free” moneyEven indies need money to buy food and drink, pay the rent, pay employees/contractors /art work/people working on the game.Might enable you to work full-time on your game, with less distractions (contract work).
  • Reduce start-up riskStarting a company has large risks involved. Funding, combined with private investment can allow you to bootstrap your company with reduced risk.Even if you fail (and most startups fail), you’ve minimed the risk on your personal assets (house, car, clothing, ps3s, bodies).
  • You can keep your IP. +++Keeping IP is a “good thing”.If you keep your IP and if you’re successful, you can build a sustainable life as an indie dev. It’s one of the best ways to build value in your company.It can help you put your game into a better state to negotiate a better deal (if you wish to follow that path).Public funds don’t want to own your IP, they wouldn’t know what to do with it, they can’t monetize it. We haven’t come across a single fund that wants your IP.Publishers do (want).
  • They only succeed if you succeed.Subtle, important point: the funds goals are aligned with yours (if you picked the right one). The funds want you to succeed. They succeed when you succeed.This is not always the case with publishers. Publishers can make money without you making money.
  • Public funds don’t restrict your artistic freedom (as much as publishers try to).They don’t influence your game design.Most of the time they have no clues about making games and don’t interfere. They expect you to be the expert on that.This is only true if the fund fits the type of game. But we’ll come back to this point later.
  • You have less legal trouble than when dealing with publishers or investors.Less strings attached on the money than a publisher deal.The contracts are often much shorter/nicer.Lower likelyhood of auditing. Less likely to need to sue them to get your money.Less likely to have problems receiving money at a milestone.
  • Takes away (a little bit of your) independenceIt needs to fit your company philosophyTaking any money will reduce your independence to a degree.Once someone else has given you money they will influence you and your work. This may not be a huge influence, sometimes not even noticeable but it will influence you.If there’s only black and white it will not fit you.This may not even be a bad effect … just keep in mind that from this point you’re not all alone anymore.I think, it’s important to consider in the long run how public funding fits into your company philosophy.
  • Takes time & effort (non-negligible; for bureaucracy/accounting)Lots of paperwork. Some even more than others (EU grant, gulp).JOKE: “Send ten copies of this form to us via Snail-Mail in printed form. This actually happened to us. Several times. (FFF, some big indie contest?)”Salesmanship. You have to convince someone, possibly get involved in politics. (applying, updating, receiving money), can be a big accounting costs.Make this clear in advance: Who handles it? What skills are needed?Can you do those without a team? Not all of them.
  • the scope and type of your game matter(s) (it must fit the funding source)Be aware that some funds are suited to only certain types of games.Don’t make a game based on funding requirements!You’ll make a bad game! You’re definitely not indie if you make a game for funding.
  • It is dumb moneyNo development support. No knowledge on tech, design, art, whatever.Little marketing power towards consumers. no information on the audience or marketplace.They’re not a PUBLISHER.
  • There are some strings attached (that you will not see at once)There can be some legal strings attached (although there will always be some strings attached).Sometimes you only get the money after the product is done (EU Media, FFF)Might affect further Investments, and publisher relations (paying back loan when you sell IP).You still have to deliver something. It’s a contract, not a gift, you are expected to give something in return.
  • Can not become an alternative to a real business plan. Public funds do not exist forever. Funds run dry, get closed. Or you’re just not eligible anymore at some point (received too much, no startup anymore etc.).Pub funding can be addictive. Don’t become a crack head. They are good to help you start out, but not to sustain a business. We don’t want to become like the lazy film industry, who expect to always be funded by public money.At some point the funding-money will run out and you’ll probably still have work to do. So plan with a buffer, try to get your own revenues as soon as possible and research for alternative funding sources EARLY.
  • Game/Digital Media funds: the most obvious.For example: Nordic Games, Bavarian FFF, the defunct 4IP, Ontario Media Dev Corp.These broadly fall into two categories: economic & cultural.Why is this important: it affects how you structure your proposal (emphasis on recovering money and the types of games that get funded. MORE LATER).Stage of the game: different funds address different stages of games: concept, prototype/Demo (most funds), full development. Few concept fundings, most focused on prototype.
  • Economic dev funds don’t care about games. mostly interested in investing in new companies, business models (which can be games), new jobs. For the most part these are again regional programmes. Check with your local Chamber of Commerce.Startup-focused, incubators, accelerators: early stages or sometimes even before it is funded. Great for students, new companies. Secondary benefits is they can help structure your business, provide good advice. (Exist, AWS Impulse in Austria), and many more.
  • Art funds: Games as art is still a tricky proposition, and we’re not gonna debate it here, but there are games that have successfully been funded by art funds. For example, some of Tale of Tales Games (Design Flanders). Or the recent announcement by the National Endowment for Arts in the US. You have to be seen as a “serious artist”.It’s about making the piece of art, not selling it.
  • sually not aimed at games but technology. So if you’re one of those rare developers who likes to re-invent the wheel, this could work for you.R&D for tech (Broken Rules got some research funding for their latest engine).There are lots of research funding opportunities available when working with universities. Usually in serious games category. EU Funding. Douglas Wilson from Copenhagen Game Collective.
  • Public assistance comes in many forms, not just money in a brown paper bag handed to you by an anonymous person:grants (Exist): money you don’t have to pay back. Just has to be spent appropriately.conditional loans: look like grants, but have to be paid back under certain circumstances (like, financial success) - sometimes with (lower) interest ratessuccess: that means that you make money off your game or sell the IP. you often pay back half of the revenues until the loan is paid back fully.tax reliefs (Canada, US): Not gonna talk about it, as we have no conclusive proof that they are viable for indies.Co-financing: A lot of funds require some amount of co-financing or co-investment, as in some amount of matching funds/investment. For certain funds, your own time investment can be counted (Austria for example).

The Art Of Public Funding For Indie Games The Art Of Public Funding For Indie Games Presentation Transcript

  • • • • • • • Felix Bohatsch Michael Samyn Gordon Midwood Douglas Wilson Lau Korsgaard Raigan Burns Yacine Salmi ysalmi@gmail.com Twitter.com/ysalmi Alexander Zacherl az@bitbarons.com Twitter.com/dbltnk
  • 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. flickr.com / jorgempf Piece of Pie Studios Bit Barons flickr.com / Dave_b_ flickr.com / Ksayer1 flickr.com / epSos.de flickr.com / quinn.anya flickr.com / Noah Sussman flickr.com / See-ming Lee flickr.com / tadekk flickr.com / Seattle Municipal Archives flickr.com / comp@ss Mega64 flickr.com / brad montgomery Broken Rules 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. flickr.com / beej55 flickr.com / Horia Varlan flickr.com / Manitoba Historical Maps flickr.com /macieklew Press Play Brightside Games Tale of Tales flickr.com / Amy Loves Yah flickr.com / LuaCheia72 flickr.com / Lorena Cupcake us flickr.com / cherie6c