If you have or are planning to get into social game development on a tiny budget, you need to get financially creative and learn to bootstrap. The practice of bootstrapping a startup is essentially an act of balancing costs against revenues, and it applies as much to a game development studio as any other business. Do it right, and your business will likely survive long enough for your games to have a chance of success — something that’s a necessity given how many small studios and bedroom entrepreneurs are jumping into the social game development space. Here are a few tips on bootstrapping as relevant to game development.
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In the face of funding challenges, startup entrepreneurs have turned to the Internet to raise funds through crowdsourcing techniques and the leveraging of social media. “Friends and family” funding takes on an expanded meaning through crowdsourcing via the Internet. This post looks at some of the ways that a startup can crowdsource funds, and refers to some of the lessons learned by Zero Point Software, a game development studio.
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Take it from someone who knows, you can win the race to become popular but have no money to show for it. Over the past few months the Social Times has gone through one of the most challenging periods. The road for building a “digital media company” has been been filled with extreme peaks and valleys. The peaks have been incredible but the valleys have been absolutely painful, pushing me to the brink and challenging me to come up with creative ways to survive.
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To the media, $1 million is not much money for a business but for hard working entrepreneurs $1 million should be plenty. I have spent the past seven years searching for businesses that would grow to make millions upon millions of dollars but after trying out one thing after the other, I’ve realized that just making $1 million takes A TON of work. You may be thinking that I should have seen the obvious: $1 million is still hard to make. Aren’t all entrepreneurs starting businesses to get filthy rich though? $1 million shouldn’t even be that hard if the real goal is much more, right? Well, $1 million is plenty for any entrepreneur just getting started.
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I was watching Mark Cuban last night in an interview from Techcrunch 50. You should definitely watch it as there was a lot that I took away and there are a lot of inspirational stories. The one statement that stuck with me and is a perspective that I hold for the most part is “Sales Cures All”. If you can hire an amazing sales staff you are light years ahead against any competitor that doesn’t have a team working to increase the bottom line.

I have spent the past 8 years trying to build businesses and all of them have failed. I’m finally running a business that is able to stay above water. If you want to take advice from a person that has failed time and time again here’s what I’d suggest:

• Launch Your Site as Quickly As Possible – I have met so many sites that are in the alpha stage and in still in “stealth mode”. In the social web economy, this will kill your company. Take a look at the quality of Facebook applications that launched and rose to the top. There are only a few companies that you can point to where quality user interfaces were critical for success. The bottom line is that good ideas are viral.
• Iterate Quickly – Once you launch your beta product which may not be the prettiest product it’s time to start iterating quickly. This lets your users know that you are dedicated to improving their experience and will keep them coming back for more.
• Find the Quickest Path to Revenue – Your company isn’t much of a company without a bottom line. You probably know of all the venture funded companies that have no revenue currently. I can guarantee you that those companies will get increasing pressure from their investors to produce. While some companies don’t need revenue, it’s critical to keep your company afloat. Facebook for instance strives to operate at or close to break-even. It’s a good model to follow.
• If You Have Something to Sell, Sell It! – There are countless startups that keep iterating without revenue. Charge someone else to pay for those iterations! One way to accomplish this is by licensing your product to a client and letting them foot the bill for your first iteration. This model only works for certain products but the lesson learned still applies to others. As soon as you have a product, it’s time to start selling.

Disclaimers

The model that I’ve described above works best in the social web economy. If you are trying to build revolutionary technologies like the fastest electric car (e.g. Tesla), keeping the product in stealth mode for a period of time is perfectly acceptable. The social web economy is one of the fastest moving industries and getting your product out there and being able to iterate is critical. Not all industries are this fast as most others are much more capital intensive.

Bottom Line

Over the past year I have spoken with countless startups and after speaking with the most successful ones I’ve realized that they always have an amazing sales team. Mark Cuban confirmed my observation last night and this rule is one I’ll continue to follow. Following this rule is also how I launched Social Ad Summit, which will take place next week in New York City.

Thanks to the support of amazing sponsors, we were able to accomplish something that I would have never previously considered possible for Social Times. Rather than waxing poetic about Social Times, I’ll leave you with a quote from Ray Kroc: “If you work just for money, you’ll never make it. But if you love what you are doing, and always put the customer first, success will be yours.”

Earlier this week I wrote a post asking if work/life balance exists for entrepreneurs. Well, for me, the balance doesn’t exist. 90-hour work weeks have become standard. My desk is around the corner from my bedroom (fortunately I have a large apartment but it’s still in the same relative space) and every morning I wake up and walk right over to it and start searching for more content to post about or find more emails to respond to.

Last May I launched the AllFacebook blog and quickly experienced substantial success with the blog. It’s not the next Techcrunch, but for a few weeks (or a couple Months) I thought it would be. I was getting story leads, responding to all inquiries and traveling around the country to attend events where I thought more stories would be taking place. The site still does well but it’s not going to be the next Techcrunch. At least not anytime soon.

Secretly, I’ve come up with a solution to win while producing less content but I won’t share that now, that story will unfold on this site over the coming months. This afternoon Jason Calacanis wrote a less-sensational post about the New York Times article from last week. He struck a cord with me this time and it has led to the post I now write. When you are in the Tornado, a phase thoroughly described in Chrossing the Chasm (and a book I frequently refer back to), it’s easy to lose sight of things.

Think about what it would literally be like to be in a tornado and you start to get a picture of how organized things are. The key thing to success during the tornado is not running around and trying to grab ahold of all your scattered pieces. Instead, you should believe that the scattered pieces will eventually realign them self and things will be as you had planned in the end. Perhaps my analogy isn’t the most accurate, but a key lesson is learned and it is the lesson being described by Calacanis.

Balance in life is key. Trust me when I say that I understand how out of whack things can get when you are trying to keep your business under control and on the right path. In the market of breaking news, balance is practically impossible. Just look at Mike Arrington. Howard Lindzon recently tweeted that the breaking news market has become commoditized. I would have to agree.

When it comes to commodities, you make a lot if you have a lot. Adding up a million pennies eventually adds up to something. The problem with breaking news is that you are constantly running around trying to get the scoop or confirmation on stories. I was getting good at it for a little while but then I began to see myself burning out. If I had continued to try to focus on breaking news, I would have gone crazy. Fortunately for me, I’ve realized that the bottom doesn’t just drop out when you stop or slow the frequency of breaking stories. You are actually building a base.

Regardless of the future of blogs and breaking news, the story will be repeated across industries. Frequently we work continuously around the clock to try to build our projects of passion. Often times people think that we’re crazy for doing it but the entrepreneurs respect it. While everyone doesn’t build a business the same way, just as they wouldn’t build a desk the same way, there is one rule that stays the same no matter what:

If you put down the tools and walk away for a little bit, your project will be there just as you left it when you get back.

There may be some dust on it if you leave for too long but for the most part, it will still be there. Over the past 10 months I have found a way to create more stress for myself and then devise systems for managing the stress. Unfortunately my system has been flawed and part of it I have not tried to fix. While stress is necessary for a business, it isn’t necessary for you … at least not 24/7.

I had learned this lesson before and I used to live by it but by late in the summer last year I stopped living by my own rules. Fortunately, I’m not 5 years down the road and looking back at this. It’s a only a few months down but for some of you, I’m guessing that you are in a similar place and for others you are years in. There is never a better time to fix the problem then today.

While we can’t build our businesses, stress free, we need to regularly free ourselves from the stress. I am most definitely going to take the first step to removing some of the stress from my life by hitting the gym on a regular basis. What are you going to do?

This past week a news article in the New York Times circulated the blogosphere. The article, titled “In Web World of 24/7 Stress, Writers Blog Till They Drop,” discusses how technology blogging is ultimately bad for your health. My initial reaction was that I completely agree. To some of my friends, I’ve become a work-a-holic. To others, I’m simply living the life of an entrepreneur. I think Danah Boyd, says it right, “those who are passionate about what they do do it to extremes.”

I couldn’t agree more with Danah. I do on the other hand think that there is a point which is crossed which is when the thing you are most passionate about becomes an addiction. I think that workaholism has become embedded in our culture and while I see successful entrepreneurs build businesses while working 90 hours a week, I’ve seen others that launch businesses through partnerships and spend less time focusing on the day-to-day routine of things.

Honestly, I think it is different for each business and ultimately the life of an entrepreneur will always be challenging. For me, I always appear to be one step away from having a life free from the bondage of work but there is always another step ahead. I know this isn’t a good thing but sometimes it’s difficult not to be working on something that you want to grow. Then again if you feed a plant too much water it will drown, sometimes you may just have to watch it grow (and possibly hit the gym).

What do you do to handle work/life balance? Is there balance in your life? What techniques do you find useful for adding more balance?

Of course we all know of the local chatter revolving around the fact that DC is or is not a good place to bring up a budding business. Many around, including me, like it here and think there are good things in the works. However, others, especially VC’s, think greener pastures are elsewhere. Well it is our chance to show them they may juts be wrong.

I was chatting with Keith Casey of Casey Software and WhyGoSolo a little while back and he was telling me about this business plan competition coming up in the area, and he said it would be a great opportunity for the local tech communtiy to stand up and be seen and heard.

The competition Keith was talking about is the Mid-Atlantic Business Plan Competition

That day is the no-holds-barred deathmatch of entrepreneur vs entrepreneur. There are presentations in the morning, a round of eliminations, and then the culmination of the entire contest… the finalists get to present in front of a public audience affectionately called the STARTUP SMACK DOWN.

The panel will include several VC’s, professors, and other local entrepenuers. Keith makes a great point when he states :

I think it’s time to put up or shut up. If we storm the place… if we completely pack the final presentations with the best and brightest from the DC Tech community, people will notice. The VC’s will do a double take. The professors will take note. The students competing will reconsider immediately leaving for friendlier places.

I am all in as they say in Texas Hold’Em. What about you ? We would love to get everyone we can in that auditorium as Keith says to make people take notice that we are here and ready to flourish. If we can start the create a minor shift in the perception of some of the panlists, they may take that back with them and start a little buzz. And that would be good for all of us.

So here are the details:

Date: Saturday, April 26 2008

Time: 1-5 PM

Where: ICC Auditorium, Georgetown University (Building 26 on this map)

So what do you say ? Stop by and join the Facebook Group I created: DC Technology Business Plan Competition Crashers if your interested.

This post was orginially posted on East Coast Blogging. Jimmy Gardner is founder of 2Plus11 Technology, a technology consulting firm, and a local entrepreneur. He writes the blog, East Coast Blogging and is a avid advocate of the local DC area technology community.

There’s a discussion place on Techmeme today about the impact of the problems being created by these pesky venture capitalists that are funding businesses with no revenue model. Now Hank Williams (the other of the SAI article) isn’t known for always being optimistic. As his article bio states, “SAI Contributor Hank Williams is a New York-based entrepreneur. He recently launched a new blog: Why Does Everything Suck? Exploring the tech marketplace from 10,000 feet.”

Well Hank, everything doesn’t suck … even in the world of the free! While giving away content or services for free forever is not always the best business model, even the free model can generate revenue. Even if the VCs are the ones funding your business, there are people that work for free just out of passion. While this model isn’t sustaining there are plenty of people that can survive for months without any pay.

I’ve been able to live off keeping my blogs going for free. Are the blogs generating a substantial amount? Not really but I could care less how much the blog itself is making. What’s more important is how much value it generates and that’s where there is money to be earned. Matthew Ingram writes a more thorough article also explaining the value of a “freemium” approach. Give a little for free and charge them for more if they like it. Kind of like an ice cream sample.

The free model is extremely challenging because you are competing heavily just to make enough to get by. Eventually you need to charge for something though. A few lucky individuals (who are also the hustlers in society), are able to generate a substantial amount of revenue from building a free base that eventually generates cash flow. Those that can’t get by end up working for the people that were able to build a business. It’s the nature of business. So stop reading this article and get back to hustling Oh … in the meantime leave a comment and let me know if you think the free model works?

Yesterday in a phone call with the amazing Leslie Bradshaw I asked a question: “What did people do to brand themselves before the internet?” Her response wasn’t what’s important (although all of her words are always words of wisdom so follow her on Twitter). What was significant is the fact that we have just witnessed a transformation in the ability to brand yourself.

Gary Vaynerchuk is the epitome of personal branding and if you watch his daily insights you will be handsomely rewarded. The main point is that the new technologies have enabled us to reach a large number of people that we were never able to reach previously without promotions via fliers, radio ads, personal publicists and a number of other methods. The bottom line is that we now have the capability to reach exponentially more people than ever before.

My good friend Rachelle Lacroix says that “it’s no longer branding my consumption, it’s branding my creation.” This means you create the content and promote it to others rather than let people judge you based on the purchases you make (you probably didn’t need that explanation though). Last night I finally the realized the significance of the revolution taking place. You can instantly set up your brand via a blog, cross promote it on social networks and suddenly you have distributed brand you to the masses.

There are millions of job opportunities that surround this new market. You don’t need to be the center of the brand that you are promoting but you should still promote brand you no matter what you are doing. Even your publicist should be known for being the most amazing publicist around. How do they do that? Set up a blog and start writing about publicity on a daily basis! The social web is furthering this transformation and it is our job to embrace it.

Do you agree? Do you think personal brands are extremely important? What are you doing to further your brand? When is self-promotion crossing the line?