GDCE 2012: PerBlue's Justin Beck on building a $3M revenue company on 15,000 DAUs
A specialist in location-based mobile games, Beck spoke about the process by which a bunch of college kids built a thriving game company in three years, under the title Bootstrapping 101.
Don't show me the money
One of the most early decisions PerBlue made was to turn down an initial $30,000 investment.
"They wanted 10 percent share of company, with preferred stock plus one board seat. But most importantly, I didn't trust them in terms of working with the company long-term," Beck explained.
Another early problem was Beck had been offered a good job with Microsoft.
Up to this point, he had been working 8 hours as an intern at Microsoft and working on PerBlue's first game Parallel Kingdom in his downtown.
"It was a lack of focus and a lot of stress," Beck explained.
Yet he argued that too often people consider getting relatively well-paid jobs at the cost of longterm happiness.
"The opportunity cost of me not joining Microsoft was zero," he explained.
"You can always get a job at Microsoft. But I had an opportunity to make a mobile game, and a team committed to making a mobile game."
Yet, the process of making Parallel Kingdom wasn't easy. After 12 months of development, the game wasn't shipped. This resulted in 95 percent of the desired features being cut.
"The easiest way to kill your company is not controlling scope, and that means controlling costs," Beck argued.
Indeed, even with this decision in place, the company still need money to launch the game. It decided to raise money from friends and family, eventually selling a small percent of the company for $72,000.
Another important part of shaping the company at this early stage was rewarding the early staff, who were granted stock options based around time worked.
"It's got to be a great deal for the company and employees," Beck said.
On the up
Eventually, the company did its first proper investment round; looking to raise $300,000 but eventually raising $800,000 to expand the business, giving away a larger share of the company compared to friends and family round.
This is mainly from midwest investors: PerBlue is based in Madison, WI.
And it's growing fast.
PerBlue currently generates around $200,000 of monthly revenue from its location-based games, mainly Parallel Kingdom.
However, it's only had 1.5 million downloads ("a vanity metric" said Beck), and only has around 15,000 daily active users and 50,000 monthly active users.
"It's not a big number, but we make between 40 to 50 cent per user per day and that is a big number," he revealed.
Of these, the gender split for Parallel Kingdom is 70:30 male:female, 65:35 US: ROW and 85:15 Android: iOS.
"iOS can't keep pace with Android. Android is a freight train," Beck said.