10 lessons from Loki Studios

Five years ago, I co-founded a company — Loki Studios — with some friends. We raised some money and built a game — an iPhone-based Pokemon-esque creature-collecting game set in a world that dynamically evolved to match your real-world surroundings. (Yes, I pitched that >1000 times). We made a bit of money. We rented out a house in Silicon Valley (with a pool). And we were acquired by Yahoo in 2013.

I’ve spent a lot of time processing the many, many things that happened. I finally sat down and wrote it all out, for my own records. What went right, wrong, what I’d do differently in the future, whatever. A lot of what’s written below may be well-known knowledge — clichés, even. But it’s a collection of my own learnings and growth, so I wrote it anyway. It’s written conversationally, as advice for future me. After spewing it all out, I thought I might as well share.

On co-founders

We started as four. We lost two. One to misalignment of goals, another to misalignment of lifestyle expectations. A year in, we added one.

You don’t need to be best friends with your co-founders. But you do require mutual respect, and a lot of trust. Try finding a point on which you disagree — ethics, politics, religion, whatever. How do you disagree? Would you be comfortable with that at 50x intensity, when everything around you is going down in flames?

You don’t need to co-found with clones of yourself, aligned on everything. Solo founding is difficult because everyone has weaknesses. So when founding with someone else, do you balance one another’s strengths and weaknesses? Enough to get to the milestones you want to achieve? You may not need a financial controller now, but maybe one of you should know how to use Photoshop. And one of you should be decent at external communications.

And while skill sets are important, look beyond the obvious. Are you cautious and strategic? Can your co-founder be the voice of recklessness, pushing you forward? Are you loud and emotional? Is someone on your team thoughtful and quiet? But see above note on disagreeing with mutual respect.

On ownership

Don’t split ownership equally. Yes, everyone told us this. We did it anyway. We were 4 Stanford CS grads and nothing differentiated us in terms of experience. How could it have gone any other way??

Doesn’t matter, don’t do it. Work together a couple months, if you have to. See what you’re each ready to contribute to the company.

On listening to users

Your most vocal customers represent 1% of your company, within an order of magnitude in either direction. Either way, it’s a small minority.

Listen to them — they represent the early adopters who will spread the word; trumpet your triumphs; disavow and curse you on your mistakes.

Don’t listen to them — they represent the early adopters who represent extremes of your user base. We expected Geomon to be playable over the course of 2–3 months. Some users hit max level in the course of a weekend and thirst for more. The end-game features for your fanatics will not be the ones to help your game grow.

(Fun fact: we took engaging our users seriously and replied to each user as an in-game character — the equivalent of Professor Oak. Each email started with: “Hey Field Agent! Thanks for reaching out to us…”)

On users hating change

Everyone knows this too. But I’ll re-iterate it here. Whether you’re adding a requested new feature or improving your graphics, some very vocal users will always eviscerate you. Very publicly. Take the feedback under consideration. Do what you think is best. Move on.

On building games (mostly for you lifelong gamers, like me)

It’s been a lifelong dream of mine to build games. Every game we played, my brother and I would ruminate on how to improve the game, or what kind of characters would make the game awesome. This is indicative of an awesome game foundation. When you have built a game inherently logical and fun, anyone — every 8 year old kids — can come up with great ideas on how to improve.

We learned the hard way that building a fundamentally sound game is incredibly difficult. How many elements should exist? 12 sounds like a nice, round number. Nope! Way too complex, nobody remembers what counters what. How much experience should gathered level up, allowing for a nice feeling of progression while also not getting people to the end game too quickly? How much should the world be dynamic and responsive to your actions? What percent of the game should be “on rails” and scripted to ensure a good first experience? How do you ensure the single-player mode is fun for those who prefer PvE, while the multi-player mode is enjoyable in the long term?

We spent hundreds of hours interacting with top players in the game who understand newly evolving strategies and tactics than we did ourselves. Gamers are clever and bright and, in the age of the internet and forums and guides, new edge case tactics spread like wildfire and can rapidly destroy the precarious balance of your game. There are a hundred aspects that require a dedicated game architect. We jumped into it headfirst slapping together a bunch of mechanics that sounded awesome, and had to backtrack later to ensure a cohesive game.

On revenue

I “grew up” in an era where it seemed sites and apps could seemingly ignore revenue. As long as you grew your user base like wildfire, there would be financial support from eager investors to get you to the next growth stage. You could IPO without ever having been profitable! We spent 18 months without putting much effort into revenue. We were growing comfortably. We were profitable on weekends and holidays, when people decided to spend. But this wasn’t the trajectory I promised my investors, my employees, or myself. This wasn’t the promised land of hockey sticks!

So we spent 6 months focusing on revenue. And through a lot of studying, experimentation and hard work we achieved ramen profitability (made enough money to feed ourselves pizza and instant ramen). Had we started this a year earlier, who knows what would have happened? Monetization may never have worked without the first 18 months we put into building the game. Then again, maybe we could have entered a healthy, profitable growth loop allowing us to create the series of games we had originally envisioned. Who knows??

On design

So… design matters. A lot. We had a kickass idea and every gamer we pitched was sold in 3 words — “pokemon for iOS”. But honestly, when they saw our game, I distinctly remember the slightly scrunched faces concealing a thinly veiled disappointment. Our game was fun! But we turned away a lot of mainstream gamers when they saw the geeky graphics we had come up with. By year two, I understood it was very important to re-skin our game. But it was hard. There were dozens of pages to redo and a hundred thousand users we might lose (see “On users hating change”). Too little, too late, and no one was experienced with visual design. So… next time :)

The concept was awesome (in my humble opinion). The design did not appeal to the mainstream.

On startups

We started this company because we were so excited about the concept of the game. We wanted it to exist. We wanted to play it. We spent a summer working on it, foregoing a summer internship and salary. It was so much fun we dropped out of school to keep working on it. We survived on prior internship savings. When one co-founder ran out, the rest of us chipped in. When that ran out, I raised some money. When we could no longer keep up with the work, we hired more people.

That’s all to say… we didn’t do it all to do a start-up. We did it because we wanted to create something we were really stoked about. And without that, I don’t think we’d have made it through the roadblocks, disappointments, and emergencies. I lived a decade in 2.5 years. I grew a lot of white hair (true story). If (when) I do another project in the future, it’ll be when I find another passion like this.

On teams

It’s all true what they say. When you’re going through the toughest of times your team’s all you’ve got. A great hire is worth 20x a decent hire. Don’t settle for less. And to steal a quote from someone wise, when you’re interviewing someone “if there’s any doubt, there’s no doubt. Don’t hire.”

On getting help

I got help from so many people so many times. On every subject imaginable. And I don’t think I appropriately took steps to thank many of the people involved. Something I hope to take steps to remedy. Thank you Ravi for teaching me how to fundraise. Thank you Shawn for lessons in game design. Thank you James for teaching me a little about art — sorry we didn’t get to work together more. Thank you Katy, John, Kyle, Tim, Amy, Annlyn, Richard and Jeremy for your help in designing our creatures and world. Thank you Dan, Jessica and Jason for your help in testing the earliest versions of the game. Thank you Yu-kai on helping build our competitive scene. Thank you Damon and Alex for making the introductions that changed the course of our careers. Thank you Osuke, Arthur, Josh, Matt, Osman, David and Miguel for believing in a handful of nobodies. Thank you Pa, Ma, Chris, and all my relatives and friends I leaned on while going through this. Thank you to our users for supporting our dreams. And thank you to the team — Chris, Brian, Sam, Gene, Bart, Jess, Russ, Marco, Juan and Rico for a whirlwind of an unforgettable couple of years.