The Evolution of Funding in Game Development: A Personal Perspective

The landscape of game development funding is changing rapidly, and it's reshaping how we create, value, and market games. I've been in the thick of it, and I want to share some insights from my journey. But before we dive in, let's consider this quote from Spike Laurie, which really captures the shift we're experiencing:

"In the past, publisher financing, which is the primary way games were made, was always milestone-based. There were a lot of progress checks and balances. A lot of control, almost. Publishers would be doing the work of finding out what the market is saying, what does the game need to say… all of that positioning work."

"With the venture capital model, a lot of those checks and balances fell away. So you have a lot of founders making the game that they want to make, because they're being funded to do so, but without validation that that game is going to be successful, especially in a world where discovery is a big challenge." - Spike Laurie, Investors on the state of video games

This shift reflects a broader evolution in how creative and tech projects are funded and managed. It's creating new opportunities, but also new pitfalls for people creating games and studios today.

My Journey with RoboSquad Revolution

I was one of the first team members of RoboSquad Revolution (originally named Zorans: Resistance). From the very beginning to beta release, I oversaw the project and grew our team from a handful of passionate individuals to 15 talented artists and developers. Our experience offers a window into how modern funding models are reshaping game development.

In March 2023, we announced a $3.45 million first round of financing for our project. That's a substantial investment for a new IP from an independent studio like ours. While it wasn't traditional venture capital, it represents a shift away from the publisher-centric approach that's dominated the industry for so long.

The Old World vs. The New World of Game Funding

Traditionally, publishers held the purse strings and called the shots. They'd dole out funding based on milestones and keep a close eye on market trends. It was a system that provided structure and reduced risk, but often at the cost of creative freedom.

Now, we're seeing a variety of funding sources emerge - angel investors, crowdfunding, and yes, venture capital. These new models often prioritize innovation and disruptive potential over immediate market fit. For us, this meant we could explore a unique concept: a team-based Third Person Shooter set in a futuristic world where AI threatens humanity's existence. Under the old model, this idea might have been a harder sell.

The Good, The Bad, and The Challenging

This new world of funding isn't all roses, though. It comes with its own set of opportunities and challenges:

1. Creative Freedom: We had more room to experiment and push boundaries. It felt liberating to explore fresh ideas without traditional market-driven oversight creating tunnel vision. When we needed to pivot we could, and most times we were better off for that.

2. Rapid Team Growth: With substantial initial funding, we scaled up quickly. Going from a small group to a team of 15 was exciting, but it came with its own challenges in coordination and management.

3. Competitive Edge: Our funding gave us the resources to compete with titles and studios that were more established, at least in terms of development budgets. Our team’s ability to harness the latest tech in creative and efficient ways allowed us to produce work that punched above our weight class.

4. Market Validation Hurdles: Without a publisher's guiding hand, we had to work harder to ensure our game would resonate with players. We were constantly questioning our assumptions and seeking feedback. This meant leaning into community engagement and building an architecture for our business and development process that facilitated that. Discord updates from every agile sprint, regular community playtesting with devs, and more.

5. The Discovery Dilemma: Getting noticed in a crowded market is tough. Our decision to make RoboSquad Revolution free-to-play and available on multiple platforms was our attempt to overcome this hurdle.

6. The Innovation vs. Sustainability Tightrope: While we had the freedom to innovate, we also felt the pressure to show growth potential. Balancing these expectations with creating a sustainable game was a constant challenge.

Innovating the Development Process

In game development, challenges arise that require creative solutions. One of the biggest hurdles we faced was efficiently processing and analyzing player feedback from our playtesting sessions. This was crucial for our development, but it was also time-consuming and labor-intensive.

To address this, I developed an AI-powered tool that automated the transcription and analysis of playtesting sessions from Discord and Twitch. This wasn't just a minor improvement - it was a game-changer for our workflow.

The tool integrated directly with our Notion database, which meant that all the insights from our playtesting sessions were immediately available to the entire team. We were saving hours of manual work per session. More importantly, we were able to iterate faster and make more informed decisions about our game design.

This experience really drove home how AI can be leveraged to solve real-world problems in game development. It's not just about creating NPCs or optimizing graphics - AI can transform our development processes too. By thinking creatively and embracing new technologies, we were able to overcome a significant challenge and improve our team's efficiency.

Strategies That Worked For Us

Based on our experience, here are some strategies that can help navigate this new funding landscape:

1. Listen to Your Community: We made it a priority to gather and act on player feedback throughout development. Our AI-powered playtesting tool was crucial in this regard, allowing us to process and analyze player feedback more efficiently than ever before.

2. Play to Your Strengths: Our team's diverse background, from educational tech to game dev, was a big plus for investors. My experience in leading teams and ability to create AI solutions for development challenges were crucial as we scaled up.

3. Be Flexible with Your Business Model: Going free-to-play across multiple platforms was a strategic choice to maximize our player base. In this new world, showing rapid growth is often key.

4. Embrace New Tech: We developed on Unreal Engine 5, which let us create a visually stunning game and benefit from the ecosystem of tools in the Epic Games Universe. But we didn't stop there - we also leveraged AI in our development process. In a crowded market, technical innovation can help you stand out, both in your product and your process.

5. Stay Agile: As our team and project scope grew, we found that agile development practices helped us stay flexible and responsive. Our AI playtesting tool supported this agility, allowing us to quickly incorporate player feedback into our development cycle.

Looking Ahead

The game development world is changing fast, and funding models are a big part of that change. New sources of funding are opening doors for creativity and innovation, but they're also presenting challenges in terms of market validation, discoverability, and sustainability.

I think the future of game development funding will be diverse. There's room for publisher-funded games, independently funded projects like ours, and everything in between. The key is understanding the strengths and challenges of each model.

For developers navigating this new landscape, it's about finding that sweet spot between creative freedom and market awareness. It's not easy, but from my experience with RoboSquad Revolution, I can say it's an exciting time to be in game development. The possibilities are endless, and I can't wait to see what innovative games and studios emerge from this new era of funding.

Moreover, I believe that leveraging AI and other advanced technologies will become increasingly important, not just in the games we create, but in how we create them. Our experience with the AI-powered playtesting tool showed me the immense potential for AI to streamline and enhance the development process. As we move forward, the ability to innovate in both game design and development processes will be crucial for success in this evolving landscape.