Earlier quoted context omitted.
Great point, I think I'm just being overly pessimistic Related, I find it interesting is that gacha games seem to ahve the highest possible returns but almost none are made by western game companies.
You're right though. Industrial software/hardware in general always has money in all times. But gaming is essentially entertainment and people only spend on entertainment last. So gaming industry has a lot of failure but even if you're successful in a huge way, you won't earn huge money. There's a big cap there.
How Y Combinator made it smart to trust founders
31–40 of 127 posts
Re: How Y Combinator made it smart to trust founders
#32Earlier quoted context omitted.
Didn't they bring back loot boxes?
Yes, but you basically can't pay for them. Revenue is basically all from direct cosmetic sales or the battle passes
Re: How Y Combinator made it smart to trust founders
#33Talking about the shift raises the question of why it used to be the other way. Were VCs bad at picking founders who were honest and/or competent, or were VCs always wrong to mistrust founders?
Re: How Y Combinator made it smart to trust founders
#34I wonder how long this can survive now that their priority is to fund AI users to use AI
Re: How Y Combinator made it smart to trust founders
#35That’s an interesting point but I have to imagine all the worst founders know it too so the filtering may not have gotten easier. I’d be curious to hear from them.
Re: How Y Combinator made it smart to trust founders
#36Earlier quoted context omitted.
I don't think that's possible and frankly I'd much prefer capital not even try. To the best of my knowledge, the only games which generate the really outsized outcomes you'd need for a VC portfolio do really gross, anti-player shit (gacha, lootboxes, whale fishing, etc.) to get it. Or they become distribution monopolies like Valve, which is fine-ish when Valve is private but would be a ongoing catastrophe if it had b…
I appreciate this perspective.. but I think there might be a false dichotomy here. Some of the biggest gaming success stories didn't rely on exploitative mechanics - Minecraft, Among Us, even Fortnite's initial success was based on solid gameplay before the monetization kicked in. The question is whether you can build sustainable platforms that create genuine value rather than just extracting it. Steam takes 30% but…
Fortnite is a bit of weird backwards example because the early PvE iteration had paid lootboxes, but they were scrapped in the Battle Royale spinoff which actually got popular, and eventually removed altogether. They still do things like engineering FOMO to drive sales but ironically the games monetization was the most exploitative when nobody was playing it.
But now the siren song of lootboxes is calling to them once again... https://kotaku.com/fortnite-loot-boxes-gambling-roblox-20006...
Re: How Y Combinator made it smart to trust founders
#37Y Combinator forged a long-term, high-trust ecosystem to the benefit of all tech founders. The video games industry needs to do the same.
I feel like this is impossible given how many games flop each year.
Re: How Y Combinator made it smart to trust founders
#38Talking about the shift raises the question of why it used to be the other way. Were VCs bad at picking founders who were honest and/or competent, or were VCs always wrong to mistrust founders?
I think it just seems like a bad idea? If you believe in expertise in business, giving someone with little of it a bunch of money seems a recipe for disaster. (And YC showed that in fact it’s not a disaster.)
Re: How Y Combinator made it smart to trust founders
#39Earlier quoted context omitted.
I think it just seems like a bad idea? If you believe in expertise in business, giving someone with little of it a bunch of money seems a recipe for disaster. (And YC showed that in fact it’s not a disaster.)
Taken to its logical conclusion, that idea suggests hiring business experts to start companies from scratch rather than investing in existing startups.
Re: How Y Combinator made it smart to trust founders
#40Y Combinator forged a long-term, high-trust ecosystem to the benefit of all tech founders. The video games industry needs to do the same.
I feel like this is impossible given how many games flop each year.
About 99% of the work you do on a game will wind up in the trashcan. Doesn't matter what kind of work it is. Code, audio, textures, models, map layouts, multiplayer balancing work, etc. are all susceptible in the same way. No one is safe from the chaos. It takes a lot of human energy and persistence to produce sufficient 1% content to fill up a player experience.
I'd estimate for a B2B SaaS product, the ratio is approximately the same, however you don't need such a broad range of talent to proceed. One developer with a desire to do the hard things constantly can be all you need to make it to profitability. Going from one employee to N employees in a creative venture is where things go bananas. If you absolutely must do an indie game and you need it to succeed or your internet will get cut off, you will want to strongly consider doing it by yourself. Figuring out how to split revenue and IP with other humans when you can't get the customer on the phone is a nightmare.