Good luck, man. I already did that, and it really paid off. I did it mostly alone, with my brother as musician, with no investment. But it isn't easy. I gone for ensuring success, which meant making a complicated piece of software that is unique and for which i can be certain there is some market without having to second-guess the audience or compete with anyone.
Going the path well walked, gets you competing with all the 99.9% remakes that are entirely invisible. The most profitable game may be cow clicker, but there's thousands upon thousands of other cow clickers that are not profitable, and which you don't see. When you say you look at 'success rate' of X, don't be looking at the % of the successes which are X, that's your basic application of rationality to this decision right here. The simple toy games are not even exercises in game programming. They are exercises in marketing (and blind luck). If you had 10 000 hours of marketing experience, then you totally should go for them.
Your company plan sounds very much like how Valve is structured. You may find it challenging to maintain your desired organizational structure, given that you also plan to be dependent on external investment. Also, starting a company with the express goal of selling it as quickly as possible conflicts with several ways you might operate your company to achieve a high degree of success. Many of the recent small studios that have gone on to generate large amounts of revenue (relative to their size) (Terraria / Minecraft / etc) are independently owned and build 'service based' software that seeks to keep the community engaged.
Alexei, I would suggest an alternative and encourage you to apply to Valve. 1) It wouldn't take much of your time to try. 2) It may help you reach your goals more quickly. 3) You don't have to invest in building a rational organization, (which is costly and hard) since one already exists.
It would be a career oriented decision (few people leave Valve once they start there) and I know you are interested in applying yourself to existential risk as completely as you can, but you should consider the path of getting really good at satisfying the needs of customers and then through that, directing resources towards the existential risk problem. It may feel like you are less engaged, because you aren't there solving the hard problems yourself -- and if you have a high degree of confidence that you are the one to solve those problems then maybe you should pursue a direct approach -- but it is a path you should give serious thought to.
I wouldn't advise you to go work at any random company. Most game companies -- particularly large ones -- are structured in a way that doesn't mean you'd have a good chance of individual success (versus working anywhere else or doing something else).
Valve has one of the highest profits per employees in the world and is wholly owned by the employees. The company compensates very well. So my advice is specific to considering an application to Valve.
I'm not sure I would want to keep the company as flat as Valve does, but that's something I will only be able to judge from experience.
If having the explicit goal of selling the company quickly will turn out to be harmful, then I will abandon that goal.
I don't follow your reasons for joining Valve. It won't give me the amount of money I want, and it won't give me company managing experience faster than actually starting and managing a company would. Also, I'm not trying to invest or build a rational organization.
I'm completely comfortable with not doing direct work on ex-risk reduction. The best method I could come up with in reducing ex-risk indirectly is donating money, hence the startup. I'm not interested in having a career, I'm interested in making lots of money.
I don't have enough domain knowledge to evaluate this advice that well, but couldn't a company earn much more than an employee, even after accounting for risk? See the discussion at 80 000 hours for relevant research. Statistics might be different for games than for the industry average, though. 80 000 hours is generally a good resource for evaluating altruistic career decisions. You can, and maybe, depending on your current state of knowledge, should, talk to a member before starting your company.
Two pieces of advice.
Firstly, write a formal business plan with the numbers as accurate as you can make them, not to show other people, but for your own consumption. How much equity do you want to have at the various stages? What skill sets or experience will the VCs be looking to see in your first 2 hires? What pay structure will you need to offer them to secure that? What skills don't you have, that you'll need your co-founder to have? Once you've got a few variant plans that seem plausible to you, apply your rationality training to them. (For example, have them checked over by someone with experience with business plans who you are NOT seeking funding from.) The reason for this advice? You're looking for a co-founder, one who shares your aims and values, someone who you'll enjoy working with, who might become a friend; but you're still going to be entering a hardball negotiation with them, and you need beforehand as firm an idea as you can get on what's possible financially, what you're willing to give up, and what you want to get in return.
Secondly, there's a lot of advice out there on how to write and present a good elevator pitch. Look for the advice written not by professional advisers, but by the people you want to emulate (successful software startup founders) and the people you want to impress (venture capitalists who have funded successful software startups). Then practice, practice, practice. Because the text in the article above is probably not giving the impression of yourself and your company that you want it to give, even bearing in mind the audience you've pitched it to.
Just found this: How to Explain Your Game to an Asshole.
Thank you for actually giving useful advice, rather than just raw criticism. :)
Because the text in the article above is probably not giving the impression of yourself and your company that you want it to give, even bearing in mind the audience you've pitched it to.
Can you expand on that?
I'd personally like to know more about the reasoning behind
- There is a lot of low hanging fruit in terms of what games are easy to make and are almost guaranteed to be profitable. (Most people don't choose these ideas because they are easy, have been done before, or the people want to make other games.)
If you look at the top iOS games, there are many remakes of the same ideas, that nevertheless continue to be very profitable. This shows that the business part of those ideas is solid. I think tweaking those games slightly, going outside of the saturated themes (city/farm games), while adding core elements from other popular games is guaranteed to result in success.
Given how little money the average gamer spends, it seems to me that earning N dollars from FarmVille might even create more disutility overall (in the form of wasted time) than obtaining the same N dollars by robbing somebody. If that's true, then LW readers who adopt your strategy but start with a different background (e.g. combat instead of game-making) should start robbing people and donating the proceeds to SingInst.
ETA: on further thought, disregard this comment, it's wrong. If you completely ignore the cost to society, then saving the world by robbery still requires an opportunity to make lots of money from robbery. Otherwise getting a high-paying job seems more cost-effective, and starting a startup even better than that. I'm sorry. Continue doing what you're doing :-)
If that's true, then LW readers who adopt your strategy but start with a different background (...) should start robbing people and donating the proceeds to SingInst.
So this is why Eliezer is always priming his readers with "rationality as martial arts"! :D
Beware the X-Rational Ninja -- he will extrapolate your volition and steal your money! Then he will give you two boxes and you can choose to take one or two of them. If you choose one box, it contains all your stolen money and an authographed edition of HP:MoR; but if you choose two boxes, the first one is empty. (The second box always contains a yearly free subscription to a Rationalist Cow Clicker, where you can click on cows representing your cognitive biases.)
I don't know for certain, but this is where my strengths lie, and this is where I have experience and connections. If the right opportunity presented itself, I would gladly start another company that promised to be as profitable.
However, this will not be the only company I start, and starting a company in the same field (i.e. games) will increase my chances of success. If I start a company in another field, I'd have to stick to that field to keep this kind of advantage.
Then shouldn't you look for a co-founder who salivates at the idea of luring a massive population of weak-willed casual gamers into Skinner boxes that make them send a constant cash stream at your company, not people who like playing games and want to make games they themselves find compelling?
An ex-drug-dealer (now a video game industry powerbrain) once told me that he doesn’t understand why people buy heroin. The heroin peddler isn’t even doing heroin. Like him or not, when you hear Cliff Bleszinski talk about Gears of War, he sounds — in a good way — like a weed dealer. He sounds like he endorses what he is selling. When you’re in a room with social games guys, the “I never touch the stuff” attitude is so thick you’ll need a box cutter to breathe properly.
-- Tim Rogers, Who Killed Videogames
Heh. As long as you know you're being evil by doing it, I won't mind. ;)
The amount of money I can make working for a company isn't even close to how much money I want to donate. There are multiple reasons to believe I will succeed, some of which I've listed above. Another reason for doing a game startup comes from Michael Vassar's advice: "Find something that inside view says you'll definitely succeed at, and outside view says you'll definitely fail it. Do it and see what caused the discrepancy." This is the fastest way to fix your perception of the world.
Starting a successful company is not magic. There is a set of skills, and I'm planning to learn and master them. Will my first startup be successful? May be not, but there is no reason to stop after the first failure, especially since I'll have so much more experience after it.
Michael Vassar's advice: "Find something that inside view says you'll definitely succeed at, and outside view says you'll definitely fail it. Do it and see what caused the discrepancy."
Please could you link to this? I want to read the background to it but can't find anything like it via google.
This kind of reasoning is worrying. On one hand, based on the high failure rates, it can be argued that start-up founders are insane. On the other hand, rationality shouldn't automatically preclude you from taking high-risk, high-payoff bets. Another rational way to approach this would be to actually figure out what separates successful start-ups from the failures and then just do that.
Start-up founders are hardly insane. From my perspective, it's the intersection between video games and start-ups that is the problem.
The things that make video games good (good writing, good graphics, good sound effects, good gameplay, etc.) are easier to accomplish when you have a decent amount of staff and enough money to throw at the problem. The video game market is horrendously saturated, with a large segment of the population not even finishing games once. (I don't have any hard statistics for this, but it's a trope that is well-attested on r/gaming and the game blogosphere, e.g. "You Gonna Finish That?").
To make matters worse, the market is also infamously critical of everything -- fail in one category, and you basically get panned. For example, Mass Effect 3 is getting a lot of flack for having a "bad" ending, despite being otherwise a well-polished game with a budget the size of Missouri.
One could subvert some of this by developing for phones, but the iOS market has notoriously finicky gatekeepers. Android, perhaps -- I don't know much about them.
I don't see why Alexei should be concerned about most of your points, because they're based off of several unexamined conditions.
Not finishing the game only matters if he plans to implement DLC or microtransactions, the customer has already paid for the game, why should the seller worry then? Of course, the main point is that if the customer hasn't finished the games he has, why should he pay for more games? While this seems like a reasonable assumption, I don't quite think it's quite clear cut. Anecdotally, I've seen people with 50+ game backlogs continue to purchase new games. On top of that, I don't think it's clear to think a backlog of any amount game precludes or even dissuades a consumer from all games; just because I have a 80 hour long jRPG unfinished on my PS3 doesn't mean I won't purchase a cheap iPhone game like Angry birds. So we need to look at rapidly growing sections of the industry where relatively few startups have been formed.
I don't view criticism as a major problem. You can't criticize a game until you've purchased it for one, and considering that most video game sales take place within a narrow timeframe of release (two weeks I believe), large amounts of criticism on forums appears to be a mark of successful video games! Of course, this isn't including hits that become successful after a long period of time due to word of mouth--Disgaea coming to mind, but Alexei is aiming for a more short term strategy rather than a long term series so word of mouth is not a strategy he would want to employ.
Mass Effect 3 in particular is a bad example, because Bioware is likely going to profit off of the complaints (Read: We made a mistake, now you're going to give us money, I'll admit I'm simplifying this because I'm ignoring opportunity costs incurred for working on other products.) This isn't including other cases like the outcry against Left4Dead2, where most of the complainers signed a boycott petition and brought the game anyway! In light of this information, I see no reason to suppose complaints have a strong correlation with reduced consumer spending.
The videogame industry still remains resilient and profitable despite hits to other entertainment industries, indicating that if saturation is a problem it hasn't been enough of one to stop the industry's growth. Of course, you can claim that it's a few large companies such as Nintendo, Blizzard and Valve expanding the industry (and they have been aggressively expanding) but in the end we still need to look at how well VG startups do.
Just to mention, tc would need to look for distribution channels other than the traditional 'send it to a brick and mortar store and hope it sells'. That would be the place where first movers have the greatest advantage relative to him and where the profit margins all lie within a exceedingly short timeframe. Microtransactions for a free or nearly free game, a la Riotgames, would be a good distribution model to investigate (I confess to availability bias on this one; I haven't looked at other companies who have tried the model and failed).
Granted, he's only considering a short term strategy.
As far as I can tell from the Unofficial YComb list, there have only been three video game startups through them: MinoMonsters, Koduco Games, and OMGPop.
MinoMonsters runs a pokemon clone with four stars on the App Store. Koduco Games made two clones and an iPad port in two years. OMGPop seems to be a reasonably successful arcade portal. Of the three, none have very high PageRank. None of the three have exited. Now it's true, none of them have completely failed either. But I would be very surprised if any of them except possibly OMGPop has really made it. They also have been around for six years and have a comparatively large staff.
Of course, this is a really small sample.
The most charitable way I can interpret this is that if the OP wants a startup incubator and a short-term exit strategy, they shouldn't try Y Combinator. The most charitable explanation for the dearth of YComb video game startups is some internal bias in their screening process.
I agree. While I have all respect in the world for YC, it's just not the place for game startups. I was thinking more along the lines of Joystick Labs.
The few sane people that make startups usually succeed, the less sane people make startups and usually fail, that's my theory.
Basically, there are the sane people who have a good reason to think they succeed, and they make startups, and they succeed (usually), and there's also much larger number of people who don't have any good reason they'd succeed, and out of those people, those who are less sane, try to make startups, and fail.
You can't generalize the sanity of two vastly different populations (those who fail and those who succeed) from average.
Please re-read _Purchase Fuzzies and Utilons Separately_.
If you want to reduce X-Risk, go for it.
If you want to make games, go for it.
If you want to make lots of money, great! Go for it, it's great doing what you love and you can always buy some of the other two later.
Choose what's most important for you, because I fail to see how these three goals converge. Game development has awful ROI. Look at venture capitalists: who is backing game startups? Noone. Game development, like show business, is very hit-or miss and the fact that many successful studios have trouble finding the funding for their next title should tell you how bad of a business it is. Majority of game developers are unprofitable, programmers are paid ones of the lowest rates in their profession and are expected to work crazy hours. Many programming practices used in game development are nothing to be proud of outside of game development.
Why do so many people want to make games then? Because they crave making games. Because they feel that more is possible, that they caught a glimpse of some future potential that might just show itself. Maybe they are delusional. There's no rational reason to believe otherwise.
One renowned game designer wrote in his profile: "Making games. Since way back. Doesn't let go." At least, he's honest with himself.
Okay, first of all let me say that I agree with your argument, but I think you misunderstand a couple of things. The only goal I have is to reduce x-risk. Now, it seems that the best way to do that is to make money, and it seems that, given my skill set, the best way to make money is to start a game company. I've carefully thought about this, and this is the decision I've reached not because I want to make games (in fact, the games I would be making for money are not at all the ones I would want to make for any other reason), but because that's what I do best.
Outside of the gaming world it might seem like it's a tiny niche, but, trust me, on the inside there is a lot of funding to go around, and the field is much bigger and wider than you think. Anyway, I don't want to tear apart every point you made. Just know that I appreciate your concern, and I've thought these things through.
Only if I think it benefits x-risk reduction. Which is to say: I'll let investors know only if it might be more beneficial for both of us for them to donate. As long as money gets to the organization of my choice, I don't really care who gives it. As for customers, I doubt it. It'll probably just confuse them, and make the company seem weird. We wouldn't want that. :)