Games industry - Time to challenge convention in challenging times.

I have just come back from #Indigo2024 as organized yearly by the awesome Dutch Game Garden where I have had the pleasure of catching up with lots of wonderful fellow industry friends and peers. We all know the industry is hurting and companies left and right have been laying off staff with Sumo and Meta most recently and approximately 40000 skilled professionals have lost their jobs since November 2022.

Whilst a lot of heartfelt empathy and support is being shown to the unfortunate individuals who have been affected by these redundancies largely thanks to the amazing and inspiring Amir Satvat (you Sir are a gem and the global industry cannot possible thank you enough!), often times a lot of us can also overlook how difficult and disheartening it can be for CEOs to have to make these difficult decisions. The wave is sadly hitting more and more smaller independent studios out there whose runway is exhausted by the second as the wide range of available content is making it more difficult to appeal to publishers and investors alike who, in the name of mitigating risks, have to be demanding and selective. This sadly is essential for publishers as games visibility and traction has become extremely challenging due to the abundance of games out there where players tend to spend more time on a very select list of titles which are not necessarily the most recent as highlighted by Michael Wagner from Newzoo during his presentation at #indigo2024's captains' event.

Not to demean the impact lay offs or company closures have on the c-suite of much larger companies, aside from knowing all of your team by name in smaller companies, these are people with whom you have gone to the trenches in difficult times, you know and have met their partners and/or children, and the idea of having to affect their livelihood makes you lose sleep as you go through all stages of grief. It is heartbreaking to see studios that have been around for more than a decade (sometimes even 2 decades) closing their doors and if you know some of these CEOs, please reach out to them and offer your help in any way you can.

And yet, when about to start my short talk at Indigo (thanks again for your hospitality JP van Seventer , Collin van Ginkel , Tom Jongens , and Christel van Grinsven ), I have asked the audience how everyone was doing and got the typical overhyped "yeah", "awesome" and "woohoo" response. Statistically, this could not be more untrue as showcased by Christel van Grinsven 's industry barometer. The results were interestingly paradoxical as discussed during our panel along with Martine Spaans , Tim Laning , and Joost van Dongen .

? If you’re not fine, stop saying that you are - acknowledge and voice your struggles, you’re definitely not alone!

? Open up and?rekindle meaningful relationships by showing humility and vulnerability; and most importantly, asking for help. An admirable example of this showcased by the wonderful Paul Deetman & Koen Deetman from KeokeN Interactive when revealing all their pitches openly on social media as well as calling for help on Kickstarter. By not asking for help, you’re depriving people from the pleasure of being able to help you. Don’t take my word for it -? check out The Gift of Help, an inspiring and thought provoking podcast by visionaire consultant Ashley Usiskin who himself went through this journey and is now amplifying the notion.

? Bring back the true spirit of camaraderie and support that once propelled our beloved industry to the top like Rami Ismail (stay awesome habibi) has actively been doing across the planet by helping out so many companies and professionals around the globe.

? Give back to the ecosystem by helping in any way you can like the inspiring Amir Satvat has been doing with his job resource pages undoubtedly sacrificing so much of his time to help those have been affected by layoffs

"You do not rise to the level of your goals, you fall to the level of your systems” Clear, James - Atomic Habits.

The above quote cannot ring any more true, particularly in an ever changing environment and if you or your studio/publishing company are not sure where to start, I highly recommend brilliant management & strategy consultant Martijn van Zwieten ?? INDIGO who has recently reminded me of this quote.

Whilst I do not claim to know better than anyone, my aim here is to provide you with some potential avenues you might have not considered when facing adversity as a studio or publisher. Some of the following suggestions might come across as obvious for some, whilst I hope you will find some others to be a bit more "creative". Either way, the following are just the culmination of the multiple conversations I have had with studios and publishers alike both in my current and past capacities for the past 15 years.

It is high time for a paradigm shift and challenging convention! If everyone was genuinely open about their ongoing struggles, you could find mutually beneficial solutions. so here goes nothing:

Developers - pitch to developers!

You run an Indie studio and funds are running dry towards the development of your own IP and publishers have thus far turned you down. Your team is already at its wits end and nothing can accelerate development and are wondering how you will be able to keep on paying them.

What if a studio on the other side of the planet had the same issue?

This is an opportunity to mitigate the risk and double down on the potential value and creation of additional revenue streams for both companies. Provided both companies believe in the commercial potential of both titles, these could engage in creating an SPV where both IPs could reside for an equitable shared ownership and engage into codeveloping both titles.

This could accelerate reaching the vertical slice publishers are so keen to see and help score potential deals. Additionally, such practice would not only help studios play on each other’s strengths and thus decreasing some of their tech debt but also open additional “business development” channels by tapping into publishers the respective studios have access to.

Should both games get signed and achieve some success, it’s a massive win for both studios, should just one game make it, it is still a win! Additionally, both companies would gain in valuation should they wish to sell or engage in equity based investment.

Publishers - pitch to publishers!

You run a publishing company and your OPEX are draining your vaults to the point where you are to shelf a partially funded title in development (albeit in-house or externally). Ahead of canceling the project remember that even a partially funded unfinished project has value and, with the help of the right co-publisher you could potentially bring the game to fruition. Sure you’ll have to share the proceeds. but better have x% of something rather than 100% of nothing.

To be clear, I am not referring to your typical co-publishing agreement whereby regions or platforms are owned or defined (though these can be), I’m referring to bringing in an additional publisher to take on the remaining financial liabilities to help drive the project to fruition.

Publishers - pitch to developers!

So you would rather not pitch to publishers for co-publishing opportunities? Why not pitch to your externally sourced developer if they happen to be in a sound financial place?

Should you be willing to sacrifice some of your pre-agreed publishing conditions so as to ensure the game does see the light of day, why not give the opportunity to the developers who are already well invested in the development of the game. We’re not talking about a simple buy out option but to create an avenue that could be mutually beneficial whereby the invested amount can be recouped (and then some) for both parties where the developers resume their role in development and publishers will engage in trying to make a commercial success out of it.

Publishers / Developers - outsource your teams as smart investment

So your live-ops, community management, or even engineering or art teams are not busy, why not consider offering their services to another publisher or studio that could use their help?

I am not talking about a simple case of charging your regular man month rate as is typical for outsourced professionals but rather charging a reduced amount that helps keep the lights on with an upside as [insert digit] percentage of profit share.

This can not only help alleviate some of the OPEX burden but also create an additional revenue source for your company. There is no one size fits all agreement template and everything is to be defined depending on the scope of work needed.

Consider Cloud Gaming platforms:

Now I'm not here to discuss anyone's views about ownership versus streamed content or even the commercial viability of cloud gaming solutions outside of the likes of Gamepass and Playstation+, but if you have not launched your content in there, why not do it? Unless your games are still selling like hot cakes, additional revenue streams are, after all, additional revenue streams.

Now I know it is tempting to go for high MGs but remember, the industry is hurting and adding a small dose of humble pie could go a long way. If you have not spoken to any of these, talk to Utomik , Blacknut , or Gamestream for a potential additional revenue stream (no pun intended).

Final words:

To conclude, yes the industry is hurting but thankfully a plethora of good news, new funds, publishers "aggressively" looking for content, signing of publishing agreements, and equity based investments are happening everyday and the situation is slowly improving. Sadly, this does require time, and time is becoming a scarce commodity for many smaller independent studios and publishers and thinking outside of the box and I hope you will have found some value in the aforementioned options.

Please share any additional ones you yourself have engaged in or have just thought about and let's help and support each other to bring our beloved industry back on an upward trajectory.