For most startups, approaching venture capital (VC) firms and angel investors for funding is an important strategy. But in the video game industry, securing capital comes with additional complications. Equity and exit-based financing that typically comes with 50 to 100 times ROI expectations is not a business model that works well with the video game industry or any entertainment industry.
Only certain game types – such as multiplayer or live service games or casual mobile games with a strong social angle, can sustain the revenue streams required to satisfy this model, which often spans 5 to 10 years of profitability. This is why VCs and Angels do not invest in companies developing PC/console games, hybrid casual games, or web-based games.
As a newcomer, live service games are generally out of reach, making venture funding unrealistic. So are there any other ways to fund your indie studio? There are 2 paths you can explore.
