Bootstrapping 101: PerBlue @ GDC Europe
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The document details the journey of PerBlue, a game company founded by college students, highlighting their decision to bootstrap rather than accept early investment due to unfavorable terms. It covers their revenue growth, user demographics, and strategies for game development and monetization, emphasizing the challenges and successes they experienced over a three-year period. The founders advocate for careful management of scope and a focus on optimizing user experience to sustain growth.
Bootstrapping 101: PerBlue @ GDC Europe
- 1. Bootstrapping 101: How college kids built a thriving game company in under 3 years Justin Beck Co-Founder and CEO PerBlue, Inc @PerBlue @JustinKBeck
- 7. Virtual Goods Expenses Purchase Swag 37% Level Up 22% Refine Oil 15% Customize Weapons 16% Change Skill 10%
- 8. $100,000 $150,000 $200,000 $250,000 $50,000 $0 Jan-10 Feb-10 Mar-10 Apr-10 May-10 Jun-10 2010 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11 20102011 May-11 Jun-11 Our Revenue Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jan-12 2012 Feb-12 Mar-12
- 9. Our Users • 1.5 million user accounts • 15,000 DAU 40 – 50 Cents per user, per day • 50,000 MAU • 1,500 concurrent players • 70% male, 30% female • 65% USA, 35% rest of the world • 85% Android, 15% iOS
- 12. How did this start?
- 23. We got offered really early money.
- 24. Take The Money or Bootstrap?
- 25. Why did we turn it down?
- 26. Terms That Stink • Small investment • 1 board seat out of 3 • 10% share of the company • Preferred Stock – protective provisions
- 27. We didn’t trust them.
- 30. My life @ Microsoft Sleep!
- 31. The real cost is not just time. Stress Focus
- 32. Microsoft offered me a great job.
- 33. Take M$ job or continue to bootstrap?
- 34. Why did I turn down the job offer?
- 36. Microsoft will always be around.
- 39. The real value isn’t the money. Education
- 40. Don’t let upfront cash buy you.
- 41. Let’s do the math 40 hr/ week x 52 weeks___ 2080 hours 3 hr/ trip x 15 trips on the boat 45 hours Is $35k worth 45 hours of fun and 2080 hours of misery?
- 44. Stock Options
- 45. How do stock options work?
- 46. Early Stage Employee Stock Options • Really low price per share • PT work .1% for a year • FT work .4%-.8% for a year
- 47. Key to compensation: Good outcomes for the company and employees.
- 48. Why did people choose this?
- 49. After 11 months of development…
- 50. We still weren't shipped.
- 52. We have to ship.
- 53. Kingdoms Spells Invites Send Messages Water Cities Crafting Event feed Global chat Mines Alliances Quests Caves Geotargetted marketing Giant turtles Warp travel Ranged weapons Scrolls Armories Magic Grove Crystal Web view Rankings Oil Tutorial Kill Monsters Weather Customizable items Hats Towers Item naming Research Leveled Weapons Territory naming Academies Ranged Weapons Sheep Armories Pets Avatar customization Societies Mini games Dungeons Oxen Trading Collect Gold Sign Posts Merchants Payment Flowers Mingling Subscriptions Statuses Female character Tradeposts Larva Flags Claiming Land Plants
- 54. The easiest way to kill your company is by not keeping an eye on scope.
- 56. We launch!
- 58. Some Context
- 59. “Got a lot of potential.”
- 60. “I don’t have enough creatures in my circle.”
- 61. “I am sick of driving around.”
- 63. “I hit my neighbor’s cat while driving because I was playing PK.”
- 64. How do we make a location-based game not so... location-based?
- 65. Sh*t.
- 66. There is more to location than just being there.
- 70. Bam
- 71. We adjusted our strategy.
- 72. We’re broke.
- 73. When you’re out of money, the ship stops.
- 74. Initial Revenue Model: Subscription Based
- 75. This was before Virtual Goods were pop culture.
- 76. But we were scared of a pay wall.
- 78. Virtual Goods Expenses Purchase Swag Level Up Refine Oil Customize Weapons Change Skill
- 79. Where players spend Food is important.
- 80. Tradeposts
- 81. We had the revenue model.
- 82. We needed money to launch.
- 83. How can we fund this? Angel or Friends and Start doing VC round Family round contract work
- 85. Friends and Family: Important Things
- 86. Family and Friends Terms • $72,000 • Common Stock • 3.5% of the company
- 87. The night before launch…
- 88. It Worked!
- 91. Raising Growth Capital • We were profitable • We employed 7 full time people • Increasing cash flow • Had a solid team
- 92. Many investors asked us to move to CA.
- 93. Perks of being in the Bay
- 94. Perks of not being in the Bay Madison, WI
- 95. The Results • Oversubscribed • Looking for $300k, total of $800k raised • Good investors that are trustworthy • 40% West Coast, 60% Midwest
- 97. Scaling Revenue
- 98. Niche products have more legs than you think.
- 100. Starting multiple new products with small teams didn’t work.
- 101. Things that worked
- 102. Improving new player experience
- 106. Investing in ROI positive marketing
- 108. Cost of Customer < LTV of customer
- 109. Cash flow growth is awesome.
- 110. We reused $800k to grow our team 3 times. 35 20 12 7 Employees Revenue
- 111. 2011 Results • 3.4x revenue growth • 2x DAU growth • Record new accounts • Record daily revenue
- 112. 0 1000 4000 5000 6000 7000 8000 2000 3000 Jan-10 Feb-10 Mar-10 Apr-10 May-10 Jun-10 2010 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Player Feb-11 Mar-11 Apr-11 May-11 2010 2011 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Graph Dec-11 Jan-12 2012 Feb-12 Mar-12 Year+ <1 Month 3-6 Months 1-3 Months 6-12 Months
- 114. What are we working on now?
- 117. Benefits of this strategy • Build a “Parallel” brand • Shorter dev time • Stick to our strength • Stackable revenue streams
- 118. Go forth, bootstrap!
- 119. Justin Beck [email protected] @PerBlue @JustinKBeck