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Start a Video Game Company

Unleashing Your Inner Creator: Building Immersive Worlds in a Video Game Company

By Business.How Team
| Updated
a city street at night with a lot of tall buildings
Camera Icon AXP Photography / Unsplash

VIDEO GAME COMPANY

Dive headfirst into the exhilarating world of a video game company, where your childhood dream turns into an adult reality. This venture allows you to sculpt fantastic realms, shape mythical characters, and craft evocative narratives, all while providing hours of joy to a worldwide audience. Feats of coding, design and storytelling combine to produce unimaginable adventures for ardent gamers. A video game company essentially conceptualizes, designs, develops and markets video games - a reality that's as exciting as the virtual universes you aim to build!

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Discover Your Perfect Domain

Unlock the door to your online success with our hand-picked selection of premium domain names. Whether you're starting a new venture or rebranding an existing one, the right domain can set the tone for your digital presence. Browse through our curated list, each with its unique potential to enhance your brand's visibility and credibility.


VIDEO GAME MINI BUSINESS PLAN

This a quick reality check to help you identify the strengths and weaknesses of your business concept before you dive in.

Business Idea: Video Game Company

Expected Percent Margin:

  • Gross Margin: 20-30% (considering costs of development, marketing, personnel salaries, and overheads)
  • Net Profit Margin: 10-15%

Earnings Expectations:

  1. Daily Earnings: Variable, largely depending on game sales and revenue model (subscriptions, in-app purchases, ad revenue).
  2. Weekly Earnings: Variable, as above.
  3. Monthly Earnings: Between $(5,000 - 50,000) depending on the success and monetization model of your games.
  4. Annual Earnings: Between $(60,000 - 600,000), again highly dependent on the revenue model and game success.

Actions to Hit Those Numbers:

Game Development:
  • Initial Investment: Highly variable, typically minimum of $30,000 to even millions for blockbuster games.
  • Quality Content: Employ experienced game developers, artists, designers, and writers for engaging and replayable content.
Marketing and Customer Acquisition:
  • Social Media & Online Ads: Regular updates on platforms popular with your target demographic, investment in targeted online ads.
  • Game Reviews: Leverage game review websites and influencers for game promotion.
Sales and Monetization:
  • Price Point: Carefully consider the price point of your game or the in-app purchases.
  • Distribution: Leverage platforms like Steam, Google Play, App Store, and Epic Games Store.
Cost Control:
  • Low Overhead: Opt for a small but efficient team, utilize freelance and remote workers to save on office space.
  • Efficient Development: Use established game engines and tools to speed up development and save costs.
Business Operations:
  • Launch Timing: Large game launches often coincide with holiday periods for maximum impact.
  • Frequency: High frequency of game or content releases can ensure a steady stream of revenue.

Please note these are generalized estimations and can vary widely depending on the game's genre, platform, monetization model, development cost, and marketing budget. It's highly recommended to hire a business consultant or financial advisor for personalized advice.


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Grab Your Business Website Name

Before you get caught up in the whirlwind of setting up your business, invest in a domain name. It's a small but significant step that lays the foundation for your brand and makes it easier for customers to find and trust you. Just like you wouldn't build a house without securing the land first, don't build a business without securing your domain name.

"Why? Can't that wait?" Here's why it shouldn't


Step 1: Determine if Starting a Video Game Company is Right for You

Breakdown of Startup Expenses

When starting a video game company, it is important to have a clear understanding of the startup expenses. These expenses can include the cost of software, hardware, and any other equipment needed to create and develop video games. Additionally, there may be costs associated with hiring staff, renting office space, and obtaining any necessary licenses or permits. It is important to research and calculate these costs before starting the business to ensure that the venture is financially feasible.

Breakdown of Ongoing Expenses

In addition to startup expenses, it is important to consider the ongoing expenses associated with running a video game company. These expenses may include salaries for staff, rent for office space, and any other costs associated with the day-to-day operations of the business. Additionally, there may be costs associated with marketing and advertising the video games, as well as any costs associated with hosting and maintaining the video games. It is important to factor in these costs when determining if starting a video game company is the right endeavor.

Examples of Ways to Make Money

When starting a video game company, it is important to consider how the company will make money. One way to make money is to charge customers for the video games. Additionally, the company may make money through in-game purchases, such as additional levels, characters, or items. The company may also make money through advertising or sponsorship deals. It is important to consider these different revenue streams when determining if starting a video game company is the right endeavor.

Step 2: Naming the Business

When naming a business, it is important to consider the target audience, the product or service being offered, and the overall mission of the company. It is also important to make sure the name is not already taken and that it is legally available to use. Additionally, it is important to make sure the name is easy to remember and pronounce. It is also important to consider the potential for future growth and expansion when choosing a name. For example, if the company is focused on video games, a name that is too specific to a certain genre or type of game may not be ideal if the company plans to expand into other areas in the future.

Researching the Name

Once a name has been chosen, it is important to research it to make sure it is available to use. This includes checking with the local government to make sure the name is not already being used by another business. Additionally, it is important to check with the United States Patent and Trademark Office to make sure the name is not already trademarked. It is also important to check online to make sure the name is not already being used by another company. Additionally, it is important to make sure the domain name is available for the website.

Registering the Name

Once the name has been researched and is available to use, it is important to register the name with the local government. This includes filing the necessary paperwork and paying the required fees. Additionally, it is important to register the name with the United States Patent and Trademark Office to protect it from being used by another company. This includes filing the necessary paperwork and paying the required fees.

Finalizing the Name

Once the name has been registered, it is important to finalize the name. This includes creating a logo, slogan, and other branding elements. Additionally, it is important to create a website and social media accounts for the business using the name. This will help to ensure the name is associated with the business and will help to build brand recognition. Additionally, it is important to make sure the name is used consistently across all platforms.

Step 3: Establishing a Business Structure

When starting a business, it is important to choose the right business structure. The most common business structures are sole proprietorships, partnerships, limited liability companies (LLCs), and corporations. Each of these structures has its own advantages and disadvantages. For example, a sole proprietorship is the simplest and least expensive business structure to set up, but it offers the least amount of protection from personal liability. On the other hand, a corporation offers the most protection from personal liability, but it is the most complex and expensive business structure to set up. It is important to research each business structure and decide which one is the best fit for the business.

Registering the Business

Once the business structure has been chosen, the next step is to register the business with the state. This process is known as “forming the business” and it involves filing the necessary paperwork with the state. Depending on the business structure, the paperwork may include articles of incorporation, articles of organization, or a certificate of formation. Additionally, the business may need to obtain a federal employer identification number (EIN) from the IRS. This number is used to identify the business for tax purposes. It is important to make sure all of the necessary paperwork is filed correctly and in a timely manner to avoid any potential legal issues.

Obtaining Licenses and Permits

The next step is to obtain any necessary licenses and permits. Depending on the type of business, this may include a business license, a sales tax permit, a zoning permit, or a health permit. It is important to research the specific requirements for the business and make sure all of the necessary licenses and permits are obtained.

Establishing a Bank Account

The final step in establishing a business structure is to open a business bank account. This account should be separate from any personal accounts and should be used exclusively for business transactions. This will help to keep the business’ finances organized and will make it easier to track expenses and income. Additionally, having a separate business account will help to protect the business from any personal liability.

Step 4: Obtaining Licenses and Permits

Before starting a video game company, it is important to research the necessary licenses and permits that are required. Depending on the type of business, different licenses and permits may be necessary. For example, if the video game company is a corporation, then the business will need to obtain a corporate license. Additionally, a business license may be required depending on the type of business. It is important to research the necessary licenses and permits that are required in the area where the business will be located.

Applying for Licenses and Permits

Once the necessary licenses and permits have been identified, the next step is to apply for them. This process can be done online or in person. Depending on the type of business, there may be different application processes. For example, a corporation may need to fill out a different application than a sole proprietorship. Additionally, some licenses and permits may require additional documentation such as proof of insurance or proof of identity. It is important to make sure that all of the necessary documents are included in the application.

Paying for Licenses and Permits

Once the application has been submitted, the next step is to pay for the licenses and permits. Depending on the type of business, the cost of the licenses and permits may vary. Additionally, some licenses and permits may require a one-time fee while others may require an annual fee. It is important to make sure that all of the necessary fees are paid in order to obtain the licenses and permits.

Receiving Licenses and Permits

Once the application and fees have been submitted, the last step is to receive the licenses and permits. Depending on the type of business, the process of receiving the licenses and permits may vary. For example, some licenses and permits may be mailed to the business while others may be issued in person. Additionally, some licenses and permits may require additional documentation such as proof of insurance or proof of identity. It is important to make sure that all of the necessary documents are included in the application.

Step 5: Creating a Business Plan

Outlining Goals and Objectives

Creating a business plan is essential for any business venture. It should include the goals and objectives of the company, such as the type of video games the company will produce, the target audience, and the projected timeline for the business. It should also include a detailed marketing plan, outlining how the company will reach its target audience and how it will stand out from competitors. Additionally, the business plan should include a detailed financial plan, outlining the startup costs, ongoing costs, and potential revenue streams.

Establishing a Budget

When creating a budget for a video game company, it’s important to consider the costs associated with the development of the video game, such as software, hardware, and labor costs. It’s also important to consider the costs associated with marketing and advertising, such as website design, social media campaigns, and promotional materials. Additionally, the budget should include the costs associated with running the business, such as office space, utilities, and employee salaries. Finally, the budget should include a contingency fund for unexpected expenses.

Step 6: Securing Funding

Securing funding is a crucial step in starting a video game company. There are a variety of options available, including venture capital, angel investors, crowdfunding, and bank loans. It is important to research the different options and determine which one is the best fit for the company. Venture capital is a good option for companies that have a proven track record and are looking for a large sum of money. Angel investors are individuals who are willing to invest in a company in exchange for equity. Crowdfunding is a great option for companies that need a smaller sum of money and are looking to build a community around their product. Bank loans are also an option, but they usually require collateral or a cosigner.

Preparing a Pitch

Once the funding option has been chosen, the next step is to prepare a pitch. This should include an overview of the company, a description of the product, a market analysis, and a financial plan. It is important to be clear and concise in the pitch and to highlight the strengths of the company. It is also important to be prepared to answer any questions that the potential investor may have.

Negotiating Terms

Once the pitch has been made, the next step is to negotiate the terms of the investment. This includes the amount of money that will be invested, the percentage of equity that will be given to the investor, and the timeline for repayment. It is important to be aware of the terms of the investment and to make sure that they are beneficial to the company. It is also important to be aware of any potential tax implications that may arise from the investment.

Step 7: Setting Up the Office

Choosing the Right Location

When setting up the office for a video game company, it is important to choose the right location. The location should be easily accessible for employees and clients and should have the necessary infrastructure to support the business. It should also be in a safe neighborhood and have enough space to accommodate the company’s needs. Additionally, the office should have access to reliable internet and phone services.

Purchasing Necessary Equipment

Once the right location has been chosen, the next step is to purchase the necessary equipment. This includes computers, software, gaming consoles, and other items. It is also important to purchase furniture and other items that will make the office comfortable and inviting. Additionally, the office should be equipped with a security system to protect the company’s assets. Lastly, it is important to purchase any additional items that may be needed to run the business, such as printers, scanners, and other office supplies.

Step 8: Hiring Employees

When starting a video game company, it is important to find the right talent to help bring the vision to life. This means finding people who are passionate about video games and have the skills necessary to create the game. It is important to look for people who have experience in the video game industry, as well as those who have the technical skills to create the game. Additionally, it is important to find people who are creative and have the ability to think outside of the box.

Establishing a Team

Once the right talent has been identified, it is important to establish a team that can work together to create the game. This team should include a lead programmer, a lead artist, a lead designer, and a lead tester. Additionally, it is important to have a project manager who can oversee the entire project and ensure that the game is completed on time and within budget.

Setting Up a Workplace

Once the team has been established, it is important to set up a workplace where the team can work together. This could be a physical office space, or it could be a virtual office space. It is important to make sure that the workplace is comfortable and conducive to productivity. Additionally, it is important to make sure that the workplace has the necessary tools and resources for the team to be successful.

Establishing a Salary Structure

Once the workplace has been established, it is important to establish a salary structure for the team. This should include a base salary, as well as any bonuses or incentives that the team may receive. Additionally, it is important to make sure that the salary structure is fair and equitable for all team members. This will help to ensure that the team is motivated and productive.

Step 9: Marketing the Business

The first step in marketing the business is to develop a comprehensive marketing strategy. This should include a detailed plan for how the business will reach its target market and how it will differentiate itself from competitors. It should also include a budget for marketing activities, such as advertising, public relations, and social media campaigns. Additionally, the strategy should include a timeline for when each activity will be implemented.

Leveraging Social Media

Social media can be a powerful tool for marketing a video game company. Platforms such as Facebook, Twitter, and Instagram can be used to reach a wide audience and engage with potential customers. Additionally, social media can be used to showcase the company’s products and services, as well as to provide updates and announcements. It can also be used to build relationships with customers and to solicit feedback.

Advertising

Advertising is another important component of marketing a video game company. This can include both traditional methods, such as print and radio ads, as well as digital methods, such as online display ads and search engine marketing. Additionally, the company can leverage influencers and other strategic partnerships to reach a wider audience.

Public Relations

Public relations is another important component of marketing a video game company. This can include activities such as press releases, media interviews, and events. Additionally, the company can leverage its relationships with industry publications and websites to reach a wider audience.

Analyzing Results

Finally, it is important to analyze the results of the marketing activities. This can include tracking metrics such as website visits, conversions, and sales. Additionally, the company should track customer feedback to ensure that its marketing efforts are resonating with its target audience.


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