Reports reveal that during the first quarter of 2017, as many as 25 gaming companies (public), together generated as much as USD$42 billion. So, the figure that you get to see here is an increase of 22% as compared to the revenue that was generated during the same period a year before.
Interestingly, 42% of the revenue was generated by the mobile gaming industry alone. It has been observed that the toys and gaming industry is usually dominated by only a small number of companies.
However, there is good news for the so-called “solopreneurs.” If you are one and intend to explore your luck in the so-called “Toys-to-Life” gaming industry, there may be excellent opportunities waiting for you. Ever since Activision launched Skylanders in 2011, the gaming industry has shown steady growth, recording USD$8 billion as revenue in 2013 alone.
Similarly, Disney and Lego moved in the same direction. As such, if you prefer to start a business in the gaming industry, you stand an excellent chance to establish yourself as a brand in due course of time. However, you will not get success overnight as there are no quick fixes.
Online gaming business as a startup – How reasonable is it?
In the United States, the video game industry is a multi-billion dollar industry. You will come across more than a few dozen companies that are developing and launching a new game every other day. Moreover, this holds true not just in one state but several states together. So, how will these companies survive the fierce competition?
Undoubtedly, innovation is one avenue you can turn to as an entrepreneur. You have to strive hard to stay abreast of the latest trends and developments that are taking place in the industry.
Continuous innovation and highly skilled professionals are the need of the hour if you want to see your gaming startup attain a certain height or reach the zenith over a period of time.
What are the chances of succeeding in this market as a startup entrepreneur?
Since it is a highly competitive market, you have to be on your toes always. Hiring skilled professionals who are well versed in animation, graphics, software, and coding is a must for your survival.
One good news is that in 2016, the gaming industry contributed as much as USD$11 billion towards the GDP of the US. So, you can expect to see a rise in this figure with every passing day. As such, your prospects in the gaming industry are bright provided you take the right measures, and all your decisions are directed to the right objectives.
How to form a startup company in gaming? Key factors to consider
In the paragraphs that follow, let us find out how you can start a gaming business. Here’s how you should begin:
1. Do your homework
The gaming startups that attained great heights within a short time span are the ones that thoroughly went through articles, journals, tutorials, research materials and case studies, and worked out purchase targets while planning layout and flowcharts about the manner in which to proceed.
2. Set up a budget
When you are planning to embark upon a startup gaming business, your financial capacity is perhaps the primary consideration that you have to take into account. You will come across many such startup companies that ventured into a business only to become bankrupt after a short while.
The main reason for the mishap is debt and the incapability to handle debts and get out of it. Why does this scenario take place? Studies reveal that not many companies can get funds for running daily business operations, which is, why they end up borrowing large sums. The inability to pay off the loans on time results in piling debt.
In order to plan out your finances well and prevent yourself from getting into debt, you can seek assistance from experienced and well-versed professionals.
3. Seek professional consultants
There are few aspects that you ought to discuss and pay heed to such as deal terms, board recruiting, feedback, negotiation strategies, investor sentiments and behavior, team outlook and employee retention.
Remember, the so-called “mentor” you select will decide the fate of your gaming startup business. You will come across many such service providers that offer their assistance to start up gaming companies like the one you intend to open but exercise caution when you hire the service providers. You can also check the credentials from BBB or Better Business Bureau and find out whether or not they have a clean track record.
4. Zero-in on the right investor for financial partnership
It is perhaps another crucial aspect that you need to take into account. The investor you shortlist must be compatible with your gaming startup business. It is best in the interest of your company to talk to the prospective investor about shared interests, whether or not you share the same objectives and goals, and vision. Stay away from the ones that tend to rip you off and have an attitude to hoodwink you.
Fast facts about the gaming industry
Check out these points:
- Out of all the gaming companies, around 95% of them are set up in the United States.
- The top 5 states in the United States that employ the most number of individuals in this industry include California, Texas, Washington, New York, and Massachusetts.
- In the year 2015 alone, this industry contributed USD$11.7 billion to the Gross Domestic Product of the United States.
Conclusion – Impact of gaming industry on employment
It has been observed that the video gaming industry in the United States generates work for more than 220,000 individuals. This data was released by the ESA or the Entertainment Software Association.
The 2017 Report states that the video gaming industry is creating jobs that are high paying. In fact, the growth rate of employment in the gaming industry increased by 2.9%, which is more than the growth of the rate of employment in other job markets in the US.