When Disadvantages Are a Blessing

No one is ever going to give me $3 million in seed money just because I have an idea. I am not white enough, young enough, male enough and not only did I not drop out of an Ivy League school, I actually stuck around the University of California (a public university – gasp!) for a doctorate.

There is a lot of talk about the desire for diversity in tech, the benefits of not having everyone on your team think alike. As our CMO, Maria Burns Ortiz, pointed out, for all the claims we hear about investors supposedly desperately looking for diverse teams, there have so far been zero bags of money thrown in through our doors.

If I had time, I’d get bitter about it but I’m a little busy being extremely grateful for the opportunities we get through other avenues like Kickstarter and federal funding. Grants are blind-reviewed. No one knows who you are or what you look like – and we’ve been funded through that process three times.

A very helpful Tech Coast Angel gave me this advice,

“Grant money is far better than any angel.”

His point was that with grant funds you are not required to give up a percentage of your firm in equity. At the same time, you are required to do the kind of analysis that investors require.  While many angel investors and accelerators claim that their technical expertise is worth as much as their cash, it seems to me that much of that expertise is applied in deciding if a company is a good investment. They ask for things like sales forecasts, burn rate, cost of customer acquisition. They force you to flesh out a lot of the details of your company. They ask a lot of questions about your team.

You’re required to do that in grant applications, too.

While we’ve managed to raise funding in non-traditional ways – about $700,000 so far – that is a relatively small amount as game development budgets go.

Enter another advantage – we have two full-time developers  – The Invisible Developer and me – who can afford to work vastly below market rates. We code our own stunts. If working on a new game means we have to work for 25% of the going rate – or even for free – we can afford to do it. This is where being older works to our advantage. Our student loans are paid, our kids are through college, we’ve saved for retirement. We aren’t going to have to give up in six months to get other jobs.

That comes to yet another advantage – not having too much money. That may sound funny, but in the best business book I ever read, Growing a Business, the author talks about how many businesses fail due to too much money. If you have a lot of money, you don’t examine all of your expenditures closely. You don’t ask whether you really need to attend that conference or whether hiring a full-time person to style the CSS and insure every page has a consistent font is really the best use of your funds.

A link to the latest update of Spirit Lake will be in your mailbox not week, if you are one of our users. We can offer free updates for life because I hate paying again for something I already bought. People who backed Spirit Lake on Kickstarter two years ago can’t believe the leaps forward we’ve made. I know that subscription model for software gladdens the heart of those who count beans, but I can’t see asking for more money from people who supported us from the beginning. My plan is to make our games so awesome that people ask, “What else have you made?”

Because we haven’t been under the gun to produce a hockey stick growth curve, we’ve been able to start with a small group of users who really believed in our potential, and gradually expand to larger and larger groups with a better and better product.

Right now it’s 1 a.m. and I’ve been having problems with the installer for the update for Fish Lake, which we are supposed to be having tested starting 7 hours ago. One thing has failed after another. The Invisible Developer is upstairs trying to get the last bug assigned to him fixed in Spirit Lake.

Perhaps this is our biggest advantage. Because no one has handed us a million or so to pay developers, we have to do it ourselves. You could not buy this kind of dedication. Even better, once we figured out our obstacles du jour, that knowledge will be part of our company permanently.

Maybe that is why when so many of those ‘advantaged’ companies have come and gone, we’re still here.




Leave a comment

Your email address will not be published. Required fields are marked *