Succeeding with community investment

[Music] [Music] hello everybody my name is Roman this is mark we come from genius and we have a story to tell a fundraising story actually without tax credits without venture funds and without Kickstarter and we actually raised about a million pounds so how did we do that and that's what I want to tell you just to introduce my co-founder mark his games developing mobile game development professional who breeds games has been in the industry for many years and has

even had top-ten hits and an amazing co-founder to have and my name is Robyn Schneider I come from a completely different industry I was in banking strategy consulting and then something happened which made drop me drop everything that I had the career and just go for something completely different which is games with a crazy passion and on this journey there were a lot of things that made me go crazy but in the end we are moving with what we did and we're succeeding with making the game that the people that inspired me the community which is behind us want to have so let me start with the basics so usually when back when I

was in finance it was all about three things when you want to get money so I was on the other side of the table and I had to make investment decisions and I was always selling saying that first of all if you want to get somebody invest three things client and create your USP have something which makes you special and get other people to think okay this is something new this is different this I can invest into that but this is not enough you can have something original in your head it can be fantastic but the problem is you need to find those who understand it don't forget it and I I felt it myself over the last two years you can waste insane amount of times on people who actually have a lot of money who just got quick cash or old cash doesn't matter who invest into in your mind maybe stupid things that can never make it and you have this great product but they will not invest into your

product why again because they don't get it investors tend to invest only in what they understand no matter how easy the cash sits and I've wasted months of my time on those people and it was very difficult to convince them to invest anything and in the end it all failed so that's the second thing so everybody will tell you get an USP but it's getting us P that somebody you can actually get access to understand and that makes it much more difficult and then the last thing also easier said and done is show that you can deliver so you can have the greatest idea you can have the a person or group of people who believe that you can actually do it but then there's the whole issue of actually doing it and it's not only about doing it actually you have to show that you can do it every single step on the way

because you will see that the money doesn't come at once it will come in cards and tranches and you need always to think ahead of how can you make sure that is money that investors with the money actually want to continue investing believe in you and they keep confidence because you cannot just lock yourself into a building disappear for two years and then come out with a great product you would like to do it like to do that but in reality it doesn't work so what did we do what was our USP who was the one who understood it and how did we convince those that we actually could do it in our case our USP was we come or I come from a community of gamers we spent a lot of money on mobile games we mainly spend it because when we were young when we were students we just really loved playing and we were super competitive but when we grew up we started to have families we started to have wives and who didn't like games and

life became difficult gaming life I mean so the realities of life were we wanted to play we wanted to play competitively be the best and enjoy competition with our friends but we couldn't so we got became increasingly frustrated over time and then mobile games came along and we had some hope because this was mobile portable and you could play wherever you want but then suddenly we discovered that you need a lot of time for it nevertheless so in spite of it being a device you you spend hours and hours grinding away on your mobile you have to leave the mobile running with the game which you can't show to anybody and it became difficult so and especially we were busy so the game said if you spend money you achieve more okay we started spending money and the worst thing happened it wanted more time from me so we were spending and it punished us by making us play more which was a very counterintuitive so basically the community was saying we want something

else so we came up with the concept together about making a game that actually doesn't consume the time from those who spend and don't want us to and that's so much time but have some money while at the same time keeping it fun for everybody who actually wants to invest the time and this was an incredible breach to do but there was our proposition and once the community so the ideas concept they said yeah we believe in it and the community when I say it we communicate we play games together so we communicated like messenger this code Skype we meet up so that's like people you randomly meeting games but we all had the same problem and those were the people who understood because they knew okay if the such a game exists that's something they would play and they would spent and therefore it made a lot of sense for them to invest many of them actually had the same idea so but they just didn't have the time to do it so I was the one who they push to sacrifice everything drop the career with the stability of my home and I had

a baby daughter just bored it's worst possible timing but sometimes you just have to do what you have to do and yeah I plunged and went for it so I had the two ingredients the USP the one who wants to invest but then how to show it and you know its disaster somebody who's a player has no clue about game development tries to make a game this cannot be good and I knew it just I didn't try so that's what I actually found mark and that's somebody who looked like he could make it but unfortunately he had a completely different idea of how mobile games should look like so we had this constant fight and Mark will later tell you about the result of that fight but I think it actually created really great dynamics and allowed us to do great things and then we started doing showcases so basically always bringing a new version out showing our gamers that we basically can do it and they started believing in

it initially we had visuals that looked like I don't know floating fishbowl arenas and it was quite embarrassing but even then actually showed them that we are going to the right direction so what what I'm saying is it's very important to basically show your progress be ready to show where you are even if you are not there yet if you are embarrassed and and that's that's basically what we did and how we raised money initially the first guys gave us like one hundred fifty thousand and then other so it gets more and it works the are doing something we had actually the community play the game in an early stage and eventually yeah it got more and more people got in they joined us from other games because they understand it we want to play games we want to have that chance to do it competitively without basically risking our lives and disappearing in the mobile gaming world

and the solution is basically to play it in your head and have completely no restrictions on how much how on the length of the play session at a given point of time so maybe let me buddy to you for one second real quick just because that might have not been very clear we're not working with publishers we're working with angels we're not working with venture funds the people that gave us that money more than a million parents by now euros by now are all hardcore gamers and we're not talking about 50,000 of them Kickstarter like we're talking about lot maybe 20 people that have all invested at least 5,000 or more usually more than a range of 50,000 100,000 into a company for us to make a game for that specific target group which is a target group of people 30s plus highly highly spending people very little time but really really into making these hardcore competitive games showing off against each other building in this great community those are the people that we got money from right so they're all some of them might be investors in their real life and that might be their job but they're not investing in us because they want to see

a return of investment as their my primary purpose obviously they would like to have one at some point and we're aiming to give it to them but they are gamers they invest in us because they want the game that we've pitched to be made and this leads me to my tips and tricks and the things that we learned while doing it because obviously it's the nobody will copy our USP or it's a difficult thing to do but while doing it we learned a lot about fundraising and we made a lot of mistakes and we're here to share this with you and we'll hopefully be able to give you some ideas and pointers that will help you new journey so first of all there is clever structuring clever structuring is linking to what Mark said about the 5,000 plus we made a conscious decision we didn't want to go for the crowd we wanted to go for people who actually have the money and can invest in our case also we wanted to prove that the gamers behind us actually quite big spenders and they can afford

it so in our case we had to put a minimum of five thousand for investment and reject everybody who offered us 4099 or anything less which was difficult to be honest because you want to take the money but sometimes the decision is you need to do what you plan and follow it through even though it seems difficult and you're rejecting stuff so clever structuring there is a lot of ways to finance and we've thought long and hard how will we actually get that money because if you get it through crowdfunding the problem is that you then it sails so you will have dat on it and you lose a lot of money then it's text because it's a return so it wasn't the right solution equity is nice but of course as a founder you don't want to give everything away especially at a low valuation at the beginning you just want to go get somewhere and then already get people in so we gave away equity but we couldn't give it to everybody so we needed a third solution so in this case we came up with a different structure

which we called investment units so basically it was a loan and the revenue share in one so what we did is they basically gave us the money lend us the money and we pay them back with a high multiple from our profit so they get and once a certain amount is reached it's gone so the loan is paid back which is nice for us because we didn't have to share the money until we are ready to share it so until we have profits we don't have to give them anything once we do we give a certain percentage away and after a certain time once the investment basically matures they are out and we can continue growing so there there was a solution we used in the beginning especially once when the valuation was low but this leads me to the second point I mean they say cash is king and in my strategy times they used to joke and say no equity is better equity is King Kong so the idea was that equity is what

investors wants and when we talk to VCS and other people it turned out that many rejected us because of our funding structure they said you have this strange investment unit you have the proper chairs we don't want that we want companies that are fully basically equity founder that has funding grounds traditional stuff so keep that in mind so if you're going for VCS then stay close to equity and you might have to give some away or get other money but as soon as you have revenue shares and other things in they might not like it because of that structure and you'll have to buy out the people and create a lot of problems next thing is tax credits so when it comes to tax credits we learned that you can get tax credits as not necessarily UK company you we an Irish company and we know about to qualify for tax credits important thing

to know we didn't know we lost a lot of money because you can only get the tax credit once you have a permanent establishment in the UK which doesn't take much so if you want to do that keep that in mind you can't get them and yeah you can ping me if you want some advice on that and the rest well let me show let Mark show you what what we are doing to explain what the community is actually investing in all right so I'm gonna do is remove you because only about two minutes of time but I'm trying to make sure that you still get what we're talking about so I'm going to skip that slide okay so what you see in the background is the actual screenshot of our currently over current version that we actually having with us and show you off it is a very simple core loop behind that game which is basically what a lot of other companies doing is well like we're not claiming that our core loop is anything innovative because we don't need to that's not worry doing that's not we're trying to innovate but we are trying to innovate on certain small details on it and you'll see on that slide that there's three things that have dollar signs on it and two things

that have a it kind of like a stopwatch on it and the stopwatch is the important part I'm going to talk about it real quick will so the three things with the dollar sign is what you usually monetize usually monetize selling stuff in games you monetize equipment or new units or cards or skills all of the kind of things these are things you classic monetize which works which we're doing as well and you have two other things that often people monetize which is energy systems or where if you want to play in a game like Star Wars Galaxies of Heroes you might need energy or tickets to fight against something else and that's something that works but what we found in our community is they don't want to be bothered with that what they want is they want to have they have five minutes right now to play they want to get into a game they want to play that right now they want to play around on go back I would do the meetings go to conference and have fun so we found out that what we need to do to achieve that is we need to find a way to split the player base we have two non pairs and we have the high spending players and somehow we need to get them all in the same game world without alienating either of them so we found out is that there's a really

really nice problem that turned out that if we solve that is actually advantage for us so imagine you have you are one of those super whales so super VIPs that spend a lot of money in games that usually means you have very little time you might have family you might have one or more companies that you run you might be a successful manager that works 60 to 80 hours a week so you don't have a lot of time and your time is often very chaotically separated throughout the week so for example if you are here right now at Pocky gamer but there's a cool really cool event going on at the same time you either have to sit here listen to us while you're also playing the game which by the way if you are that's fine with us but there might be in case cases where you can't do that and so you're losing out on stuff on the game that you want to be competitive about and you want to really be good about so we found out is that there's a really easy way of solving that is take the non paint it'll paint people that have a lot of time that do want to invest more time in a game but they don't have the funds and the money to do that and let them help the payers and the way we're doing that is with this so if I'm a high paying spender I can have

my account and I can share my account with other people but not in a way that I'm giving my email my password hours which is number one usually not allowed number two not really likely to be seen on app stores or anywhere but in our case what we do is we're giving them we're lending your character to another player temporarily but you have full control of what they can do with it so if I want to have Roman for example play with my character I might tell you it give him the permission to only play ad daily events or I might give somebody else D permission to use my full account including using the money that I put into the account but if I don't trust him yet I might just not say that I might just not check the box that says okay you can actually use the credits or the currency in the game I might just give him the allowance to only play a story mode additionally we can set rewards for that so because obviously like you want to get something for the time that you'd listen to somebody else's character and I can't so we were giving you is we're giving him the option to say well actually if you complete all my daily missions today you and on your account will get something

from my account some bonus currencies and bonus point something like that so we're motivating high spenders and low spenders to work together so that instead of what you usually have another of those games is like the clash between well you're just paying to win because there's this disconnect between those two types of players and what we're doing which bringing team together we're making them feel like a team because both are disadvantages advantages and we're not quite sure where nobody else has ever done that because it's the first thing every single person of those super waves we talked to has told us like I don't have time to play like give me something give me a way to interact in the game give me something in a way to be competitive without having to spend hours and hours every day because I can't do that that is a really quickly over you watch this obviously because we don't I don't think we have time for question 1 minute we have time for questions but the important part is we'll be here please if you have any questions we're an open book ask us will answer whatever question you have but so for that one question I think that we have time for any questions

Figg doesn't like coming somewhere i don't really see anything okay how's your game actually been released and is it profits above us again no well kind of so we have a community that's very active already with disco channel Facebook channels all that kind of stuff we have community that's already playing the game so what we are going to go into soft-launched by July this year I think that's accurate plan obviously things might change but if planets go soft launch July this year release early next year we have a crude community is playing the game every day they're already having fun with it so we already gained the data we're already getting KPIs from those people so we're getting there okay all right all right thank you sorry so one of the biggest things I noticed so it my backgrounds in eSports so you you have things like the international stuff which a lot of people may or may not know of in the room so I mean how do you get the players engaged in a level where they

they become almost like an seed investors essentially in in these games companies but you have that progress actually through the lifespan of the company by essentially I don't know monetizing the community essentially where they're helping build more value and content in that type of way so I mean how do you guys see it going from the beginning to essentially I would say a billion dollar plus company in that type of way what valve is done yeah there's two things that we're doing to get the community a little more involved and just kind of playing the game the mourners we hired a london-based writer who came up with this really nice concept of building a story in such a way that if you complete an event as a player number one your character will become part of that story become part of the next events at some point actually become a boss fight in our game that every other character you can and every other player can then fight so it kind of having this evolving world where every time a player does something awesome in a game they'll become part of that game and by that we're hoping to build as kind of as almost like a meta community around the game that's kind of pushing to get forward and creating

their own stories and we're kind of working with those stories on the second part is we're having something called faction which are these join teams their value entities are they were made up of several smaller teams and have to choose which factor you belong to which means that you have these giant metal wars between multiple teams horns to play at thousands of players fighting against each other to push their faction forward and that's a recurring event will happen every month or every two months for is especially that's purpose with the best rewards in a game and that's kind of something that we repeatedly are going to continually improve on in hopes to get not necessarily be full eSports around like a little like on say we're on mobile game donors international that's a whole different beast so I don't think we're ever gonna get to that point we're gonna try to figure out what we can do on that device that we have and with the community I have to get to something like that level and the third thing is we actually keep them close and we they treat a developer like friends and they and who understands them and we try to keep this also when we grow if you succeed that they will be close just

because they feel like it's family and that as important as the game itself because they need to feel that they're treated right especially if they invest time and money in it yeah thinking I think we're gonna be thrown off sorry yeah you know anymore thank you very much okay [Music] [Music]