Part 2 of this series will focus on the importance of networking. Part 1 is about the basics of Venture Capital, and you can read it here.
Disclaimer: This is my experience and my opinion. There are certainly other ways to go about this process; think of this advice as just another tool in the toolbox, not the only tool for the job.
Networking is important in this industry; I don’t think there are many people who would argue otherwise. When talking about raising money from investors, though, it becomes vital. Just like marketing a game, pitching investors is a campaign that benefits from sheer volume of investors seeing the pitch and then building relationships with those investors that show interest. I consider networking in this sense to have two basic parts: growing your network and then cultivating it.
Growing Your Network
In order to successfully work with VC funding, it’s necessary to have a large pool of interested investors. There are numerous factors that can go into a venture capital deal, so it’s beneficial to treat raising this sort of investment like it’s a campaign. The more people who see your pitch, the more potential investors your studio is apt to acquire.
The best way to grow your network is to constantly be looking for ways to extend yourself and meet new people. Every time you pitch to someone, ask them if they know anyone else who might be interested. When you follow-up with them, be sure to ask again.
Getting started can be difficult, but here are some resources:
● Meetups (Startup Meetups)
● Hackathons / Game Jams / Demo Days (Hackathon.io)
● Linkedin Groups (Video Game Financing)
● Twitter (Twitter List)
Depending on the location of the company, it may be necessary to travel to help grow your network. The map above can give you a good indication of the investment market in your area.
Cultivating Your Network
Getting a business card or an email address is not enough. Once someone shows interest in connecting with you, your ultimate goal is to convert him or her into a believer. To pull this off, it’s essential for you to have a cause or vision that other people will want to get behind, and find a way to get them involved and invested in the outcome.
The best way to convert someone into a believer is to start by humbly presenting your company and game and asking for feedback. VC investors are usually open to sharing their opinion and I found this to be a good way to gauge interest in our company and mission. Once someone has given feedback, they will have some stake in the outcome, and that relationship can continue to grow. Do not underestimate the value of these face-to-face meetings.
The game industry is a competitive place and it may seem like a good idea to be protective of valuable contacts at key partners, press outlets, or other studios—but that’s not so. I’m not saying you should hand out introductions to anyone and everyone, but I do think it’s a good idea to foster valuable connections. Whenever possible, I favor a double-opt in introduction, and it has produced great results. Each time you meet someone new, consider the rest of your network and try to make connections.
There are many ways to become “that guy” or “that girl” by abusing your network. Most people can smell when someone is trying to “game” their network or event. Don’t do that. Be genuine, honest, and helpful, and it will go much further than any Machiavellian strategy. Your network will reflect your reputation, and that is critically important to potential investors.
Each person that you convert to a believer will be a positive reference when other VCs ask about you (and they will), so it’s always a good idea to be mindful of how you preach your vision. At the end of the day, networking should be considered a part of getting your game funded, because building a strong network is the best way to secure investments.
Once you have built up momentum with your network it is time to start pitching. That will be the topic for Part 3.