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Adam Creighton, Computer and Video Gaming (Subscribe)

Friday, September 08, 2006

AGC Day 3: Financing Choices for Start Up Game Companies

I haven't done this in a long time. Walked into the wrong room. I had intended to go into "Design and Implementation Considerations for Deploying Server and Network Infrastructure in Asia and North America", but walked into "Financing Choices for Start Up Game Companies". Whoops (but, look, yesterday's choice was between "Economic Theory and MMOGs" and "New
Frontiers in Digital Acting. A BioWare Perspective").

I was going to walk out, but thought about the topic's applicability to everything I do at BigHugeCorp. Every time I start a new program, every time I take over a new program, every time I try to rebuild an existing program from the ground up -- I'm in essence doing a startup.

The funding techniques didn't apply per se, though I did take a few of the relationship tips as applicable to getting additional internal funding.

Not that this was an easy push to make applicable to BigHugeCorp. This was a subdued talk, presented by Paul Kim, Executive VP of Go Pets, Ltd.

I'm talking SUBdued, the topic is comparitively dry, and the vibe in the room was floor level, and understandably so. These are folks who want to "make games", and Kim appropriately shot that down with the reality of needing to decide what that means (are you a publisher? Developer? Porter? Licensed or original IP? Etc.), and what it costs -- financially and time-wise.

There was good talk about what to leverage and why. Leverage yourself (you are building a product), your product (you're building an asset), your contracts (you're building a business), your network (you're building a successful business).

Institutional funding was an interesting side discussion. I didn't realize that in addition to the largely untapped US gov funding, other countries pay even more to incent US development on their soil. For example, $20M from Singapore; Korea will provide office space AND pay 1/2 of your payroll (and you pay no US income tax, I believe).

Creative funding needs to be more leveraged. Think cross-vertical investments. Unfortunately, the applicability I see for this to BigHugeCorp is probably going to go away.

As an aside, Go Pets is an interesting and encouraging business story. And Kim is pretty impressive.

Mother! My Treo's dying again. So I'll curtail this.

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SOURCES: Gamespot.com, joystiq.com, kotaku.com, Xbox.com, IGN, GameInformer, Official XBox Magazine, CNN, gamesindustry.biz, and others.

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