Games developers need to become more ambitious in their business aims in order to attract funding and investment, says Richard Wilson, CEO of TIGA (The Independent Games Association).
Speaking at London’s AppsWorld in November, he claimed that the UK is currently attracting just 4% of global gaming investment, compared to China with 8% and Finland with an impressive 17%.
One third of new games studios close
Despite a games industry worth in excess of £1billion and over 10,000 games developers in the UK – the largest in the European Union – nearly one third of all studios that opened in the past five years have subsequently closed.
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Whilst access to funding is often difficult – the application process can be time consuming, with multiple meetings and pitches and no guarantee of success at the end of it – it’s essential that games developers attract third party funding and external finance in order to grow and compete in a global industry.
Finding gaming finance
TIGA surveyed 38 independent UK games development companies in May 2014 and have published a comprehensive report which is free to download from TIGA’s website.
The report includes case studies and interviews with games developers and investors along with a source-by-source funding guide for UK games companies. These include equity investment from individual investors, corporate venture capital funds, equity investment and grant funding from accelerators, government-backed business funding, crowdfunding and tax rebate schemes.
“The UK has experienced unprecedented levels of new games development start-ups in the last few years and the sector is still transitioning from a dependency on publisher and other client funding towards self-sufficiency.” TIGA report
Tax relief and credits
Games Tax Relief and Research & Development Tax Credits are another potential source of financial support for developers; games companies that have successfully applied for tax relief have been able to recoup 20-25% of their operating costs, so it’s worth considering these options as well as Government initiatives like the Enterprise Investment Scheme and Seed Investment Scheme.
TIGA recognise that there is a real need to develop skills within the industry – not just technical skills, but also business and commercial skills that are essential for long-term growth and success.
Developers seeking external funding need to demonstrate enhanced communication and business skills and meet the criteria of investors who are looking for an experienced high-quality management team as well as strong business IP and brand/game technology.
“Helping game developers and digital publishers connect with investors remains a core goal of TIGA”
To help meet this need, the organisation is hosting its annual Access to Finance Forum in London on 20 February.
“Helping game developers and digital publishers connect with investors and develop the skills needed to improve their access to finance remains a core goal of TIGA, and we hope that this event will enable more games developers to secure finance and successfully bring their games to market”, said CEO Richard Wilson.
You can find out more about TIGA here. It’s also worth looking at TIGA’s Sources of Games Funding report. The London Access to Finance Forum event registration on 20 February is free for TIGA members and costs £49 for non-members.
