Can you live on the funds you make?

[Geoff Moore]

Millennium 1 made about 400 times its cost over time...

Nice!! I'm not asking for numbers here, but what do you include in the project's 'cost'?

 

[Indinera]

It really depends if those several hundreds come from a full or part time job...

Nice!! I'm not asking for numbers here, but what do you include in the project's 'cost'?

Costs to make the game. I'm not including the time I spent on it because I wouldn't be able to evaluate how much my time is worth xD

 

[Geoff Moore]

Yep, I was wondering if time would be included (marketing as well as developing). So costs for resources, basically? 400x sounds amazing, don't get me wrong, but of course resource costs for an RM project could vary anywhere between a few dollars and thousands.

 

[Tai_MT]

You really don't need to factor in "time" as a cost of the game unless you're paying others to work on it with you.  Your own worth of time is the profit you make off of the game.  If it took you two years to make it and you make a 400% profit after other expenses, that's what your time is worth.

Marketing would probably also be a consideration of "costs" of the game, as marketing is seldom free and usually is a recurring cost.

 

[Indinera]

Yep, I was wondering if time would be included (marketing as well as developing). So costs for resources, basically? 400x sounds amazing, don't get me wrong, but of course resource costs for an RM project could vary anywhere between a few dollars and thousands.

Yeah it wasn't so expensive I guess. I'd made the original version of Moonchild with virtually only the cost of RM, and it had done really well for a game using only RM resources. I then upgraded it because I didn't want to leave the game as merely an experiment.

You really don't need to factor in "time" as a cost of the game unless you're paying others to work on it with you.  Your own worth of time is the profit you make off of the game.

Very clever and I totally agree. But some people in the industry consider that even in this case you have to include in your budget your own "salary". I tried to explain to them my salary is what the game will make but I could never get the idea across xD

If it took you two years to make it and you make a 400% profit after other expenses, that's what your time is worth.

Well obviously it's much better if it takes 2 months rather than 2 years.

But the 400% is really "game income divided by game cost", nothing more.

Marketing would probably also be a consideration of "costs" of the game, as marketing is seldom free and usually is a recurring cost.

I don't pay for marketing. My problem with advertising, PR firms etc is that they don't give any guarantees of anything. You pay and you might have paid for nothing. So I don't do it.

 

[Tuomo L]

I'd take several hundred a month. That'd at least pay my mortgage, freeing up funds for other things. And, honestly, that's not bad for a side job, here in the US.

Sure, but the OP asked making a living, which would be a primary job. Which meant all taxes, food, bills, etc would be paid with it as well.

 

[EternalShadow]

In the UK, you'd need about £1000 p/m minimum. That's about $1400.

 

[bgillisp]

@Tuomo L: I know. But you gotta start somewhere, right? After all the odds of your game being the next Minecraft is probably lower than the odds of winning the lottery, so set expectations low and if it takes off well enough to live off of, then...

 

[Tai_MT]

@Indinera

Well, the people in the industry that think that have never run their own business or their own company.  In any company, the people who get paid last are the people who own it.  At least, that's how it works when you own a small business and can't just throw around the kind of money EA and Activision do on absolute nonsense and BS and then pay themselves handsomly for it.  Costs of everything else are primary (your workers so they keep working, rent on building to keep the business running, etcetera.  Your own take-home pay is the last thing you should be worried about, as without the company, your effective income is 0) and cost of yourself is secondary.  You'd need enough to "survive", but being an Indie Game Developer gives you the option of a 9 to 5 job on top of the time, money, and effort it takes to make a video game.  If the only source of income you have is your video games, then yeah, you'll probably have to budget in "what I need to live" as you have no other income...  But, unless you're making $18,000 or more a year doing nothing but video game creation...  You should be working a steady job until you can make enough to live without that steady job.  That just is what it is.

Well, your 400% profit would be what you put into the game in terms of costs, then making back what you put into it, then four times extra the cost you put into the game.  If you put $10,000 into production of the game, then make that $10,000 back, you've made no profit.  If you make $50,000 after the initial $10,000 you put in, you've made 400% profit (after subtracting the initial ten for the costs of the game).  Your own personal time would then be worth that $40,000 a year you had left over.  Just divide by your work hours and that's what you're worth paying an hour.  Or at least, in principle, that's how it works.  What you'd pay yourself isn't really going to be equal to what others would pay you.  But, yeah, in general, you'd want to at least make a good profit in a single year instead of several...  But...  That isn't always the case.

Well, any form of advertisement is going to cost you some kind of money most of the time.  Put up a website to host and help market your games, it's advertising and marketing.  You don't have to pay a firm or advertising agency, but there are probably going to be some associated costs with marketing your game.  Even if all that is, is getting it listed on other websites so it can be downloaded.  I, personally, would be wary of marketing and advertising agencies myself.  But, even the cost of advertising yourself usually costs you money.

 

[Indinera]

Well, your 400% profit would be what you put into the game in terms of costs, then making back what you put into it, then four times extra the cost you put into the game.

Actually I do not know at which moment the "%" was added lol, but it was really 400 (without %) originally, in the sense that the game made 400 times its cost.

If you put $10,000 into production of the game, then make that $10,000 back, you've made no profit.  If you make $50,000 after the initial $10,000 you put in, you've made 400% profit (after subtracting the initial ten for the costs of the game). 

Yup, I see what you mean, but in this case I would have said the game made 5 times its cost ^^

Your own personal time would then be worth that $40,000 a year you had left over. 

Yup again and salary would be 40,000 divided by the number of months you spent on that game.

Well, any form of advertisement is going to cost you some kind of money most of the time.  Put up a website to host and help market your games, it's advertising and marketing.

It's about $100 yearly and unlike PR firms and co, you know very well what you pay for. What I don't like is this kind of business, pay $200 upfront and "we are a PR agency recognized in the industry, we know 10 millions people, we'll write your announcement and send it to all our contacts blablablabla, we'll advertise your game, you'll see traffic bumps, extra sales etc". and in general nothing ever happens. $200 lost. Just write the announcement yourself and send it out yourself, it's not like the PR agency guarantees you that it will be picked up by big websites if it's them who write it... tbh if they'd start being payed *only* when goals are met (for instance announcement picked up by website A or , they'd go bankrupt xD their business is really to make people believe that they are needed.

On the other hand, if you pay for hosting, you know exactly what you get.

 

[Tai_MT]

There are actually advertisers who charge based upon their results.  But, they're generally more picky about who and what they advertise.  It's more a "This is what you'll pay this year, and we can guarantee this much of a sales bump" and then they offer ways to track the bump by having codes that "give special discounts".  So, it would be something like a 10% discount on your product if the customer uses the code that they are advertising it with.  It's a means of tracking how much traffic the advertising/PR Firm is actually bringing in and how many sales they are actually contributing to.  However, this isn't done by a lot of places because it's a risk in and of itself.  If they advertise and nobody shows up and uses their codes, they generally don't make much money and lose PR themselves.  That's one of the reasons these companies usually only try to push what they believe to be "quality" products.  Because, if they don't, they're taking a pretty big risk themselves.

Personally, I'd prefer that kind of advertiser, where I can track exactly what they're bringing in and where their company would suffer if they didn't deliver, but these are usually few and far between...  And pretty freakin' expensive when all is said and done.  But, generally, if you can hire those kinds of advertisers, they do work, and well.

 

[Missile]

Too many interventions here for me to answer to everything. Beside I have a rule to never disclose my sales and revenues, but one thing that is very true is that games sell for a very long time. All my games still sell something every year. Millennium 1 made about 400 times its cost over time and is still selling pretty well.

So all in all, a good strategy is to release good games regularly. Twice a year is a good start. And release them everywhere you can (including on my website ^^).

It includes bundle keys (worth about 0.2 dollars lol) and free keys (worth nothing) so it's not really a good indicator of revenues.

Tried to specify that with "checking to see if some were in bundles/etc." Don't think that the existence of bundles or giveaways illegitimizes the stats of certain RM games, though. A quick google of "(game name) + (bundle) or (giveaway)" should help out in filtering the accurate results from innaccurate.

It'd also be important to keep in mind release dates, since RM games released after ~2014 tend to sit in the ~1-2k range of regular sales numbers, which for a team releasing a game once a year isn't sustainable. Would definitely agree that two a year is good!

 

[Skurge]

Would you say its best to have your product price ranged before hand on the steam green light?

I'm from Australia so making money out of a game on Steam or Android market etc would be pretty good- but that sorta depends

on how many people actually want to buy it here.

 

[Indinera]

A quick google of "(game name) + (bundle) or (giveaway)" should help out in filtering the accurate results from inaccurate.

Generally bundle figures are hard to come by once said bundles belong to the past. And it takes a lot of investigation to gather all the bundle and GA figures.

Would you say its best to have your product price ranged before hand on the steam green light?

Doesn't really matter IMO.

I'm from Australia so making money out of a game on Steam or Android market etc would be pretty good- but that sorta depends

on how many people actually want to buy it here.

That's a bit difficult to predict. A lot of influencing factors.

 

[Missile]

Generally bundle figures are hard to come by once said bundles belong to the past. And it takes a lot of investigation to gather all the bundle and GA figures.

Bundle figures are mostly insignificant towards revenue unless it's with Humble, so wouldn't think anyone would want to extrapolate sales data from them. If a game had to jump to a smaller bundle, its normal stats wouldn't have been reasonable or useful either. It's fairly easy to google to "filter out" games that have been in bundles from consideration.

 

[Indinera]

Bundle figures are mostly insignificant towards revenue unless it's with Humble, so wouldn't think anyone would want to extrapolate sales data from them.

That's why websites like Steamspy are so misleading. They give same weight to a purchase at full price and a bundle purchase. Just from games of mine I see games charting poorly although they generated better revenues than games charting much higher.

Incidentally, for games that sell poorly, bundle figures can be somewhat (and in some rare cases very) significant. The more the game sucks at selling on its own, the more it is likely to be happy with its bundle figures, because it will just piggyback on the quality of the other games. That's why when you have good games, bundles become much less interesting.

If a game had to jump to a smaller bundle, its normal stats wouldn't have been reasonable or useful either. Hence googling to "filter out" games that have been in bundles from consideration.

What would be better is for those websites to separate "owners" in 3 categories: steam purchase, bundles and giveaways.

Sometimes having 50,000 owners is 1000 steam purchase 10,000 bundle keys and 39000 giveaways keys LOL Other times 2,000 owners means 2,000 steam purchases. It's very possible the latter made more than the former... but people browsing through Steamspy will most likely think the former was far more successful, when it wasn't.

 

[Missile]

That's why websites like Steamspy are so misleading. They give same weight to a purchase at full price and a bundle purchase. Just from games of mine I see games charting poorly although they generated better revenues than games charting much higher.

Incidentally, for games that sell poorly, bundle figures can be somewhat (and in some rare cases very) significant. The more the game sucks at selling on its own, the more it is likely to be happy with its bundle figures, because it will just piggyback on the quality of the other games. That's why when you have good games, bundles become much less interesting.

What would be better is for those websites to separate "owners" in 3 categories: steam purchase, bundles and giveaways.

Sometimes having 50,000 owners is 1000 steam purchase 10,000 bundle keys and 39000 giveaways keys LOL Other times 2,000 owners means 2,000 steam purchases. It's very possible the latter made more than the former... but people browsing through Steamspy will most likely think the former was far more successful, when it wasn't.

Absolutely - the bundle games can make things quite hairy, but I don't think that makes Steamspy a poor tool at all. Even excluding bundle sales, there are more than enough vanilla RM statistics for one to browse and gauge themselves as a newcomer. Filtering bundles/giveaways, Steamspy is far more useful of a research tool for stats than indie devs have ever had. Quite a few extremely insightful articles have been written using it. I think the transparency has been nothing but a net benefit to everyone as a whole.

 

[Skurge]

What about kick starter, from what I understand alot of RPG makers get projects off the ground with some funding from there? Any input?

 

[Andar]

Problem with kickstarter is that you need to be able to present something there to get additional funding - the times where the promise of a project on kickstarter got money are long past.


You either have to present a reputation (you're known for good games in the past) or a half-finished game that needs the kickstarter funds only for finishing touches.


And in the case of a successfull kickstarter, that means you usually have to give them the game as rewards, which means that kickstarter only gives you advance money by taking it out of your first direct sales.

 

[bgillisp]

@skurge: I haven't seen or heard of a succesful RPG Maker kickestarter in a long time. All the ones I've seen advertized in the last year have failed to meet their funding goal. So I'd say kickstarter funds is a non-factor right now, as most are getting a big fat $0 from kickstarters.