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26 Feb 2015

Starting Your Game Business Part I: Business Plan And Legal Steps To Take

Starting a game business is not as simple as deciding that you one day want to begin developing video games. Okay, maybe it can be that easy, but you need to plan ahead before you start developing games for a living. You are essentially forming your own business (in fact, that is exactly what you are doing); and as you already know, starting your own business is a huge step for anyone. Building games is not just ‘fun and games’ another starting a game business. Take a look at our tips below, and learn about the most important aspects of building your video game empire the legal way.

Business plan

Before you start doing anything, you need to create a roadmap to ensure that your game business is off to a great start. This means you need to create a business plan, and has some great tips on how to write the best business plan for your needs. Going in-depth with this would probably fill a week’s worth of blog posts here at Game Academy, so we will provide you with a simplified version on what your business plan needs.

First, you need to summarize the outline of your plan. Think of it like the objective of a resume: it describes the point of what the reader is looking at and explains the goals that you have for your business. Think about this carefully.

Next, you need to describe your business and mention the current landscape of the video game industry as a whole. Be specific about this. For example, if you are developing only mobile games at the moment, detail the current landscape of the mobile game industry. From there, detail where you think the industry will be in the next 5-10 years, and where you also hope your game business will stand.

You also need to mention how you are going to market your game business, strengths and weaknesses of your competition, how you are going to manage the business, how your games are going to be created, and how you hope to manage your finances in the first two years of your business. It is a lot to take in a lot of research to conduct, so if you have any questions ask a peer or someone that you know that has started their own, lucrative business.

Make it legal

You also need to make the game business legal. Operating your business without any legal protection could be costly, and because there are so many crooked developers out there just waiting to steal your game’s assets and pass them off as their own, being protected legally is more important than ever. We actually wrote a post about this a while back, and what we found was that there are some developers that make a living stealing the code of games and repackaging them with a minor-tweaked name. It is a disgusting practice, and if any of your games become huge hits, they are going to be targets.

The best place to start is by deciding what type of business you want to form. Most of you will probably form a sole proprietorship, which will allow you to still use that catchy game business name that you came up with while not having to worry about being legally obligated to in-house employees. Especially if you are going to outsource 100% of your workload, this is the way to go.

For those that want to form a game business with partners (such as your friends), forming a partnership business is another option.

If you want to be protected from debts and other liabilities, you will want to form a limited liability company – otherwise known as an LLC. An LLC will allow you to detail exactly what rights, duties, and liabilities your employees will have. The game development section of Tuts+ has a great overview as to what an LLC actually is (along with some other awesome resources that are worth a read).

If you live in the United States, contact the IRS and set up an Employer ID Number (EIN) for the business and tell them the name. This process is actually very easy; when I first started writing professionally, I created an EIN and it only took 10 minutes of my time.


In the end, none of us are lawyers here at Game Academy (we don’t even play one on television since none of us are actors). Our overview may have caused more questions than answers, so if you have any questions about starting your own business the legal way, consult a lawyer. They will help you to set up everything legally so there is no loose ends that could hurt your business down the road. It is probably a good idea to contact a lawyer anyway and get acquainted with them. In the event that you need legal services, having a go to lawyer is always a great asset.

Do you have any questions or tips about starting your game business slow legal way? Let us know in the comments below!


Game Development – Tuts+

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