Hybrid Business Models
Hello, once again Stefan here. Today I will tell you a bit about the kind of hybrid business model that we will use for 2GuyGames as Marco promised last time.
First, it is important to clarify what a hybrid business model is. Companies have to decide in which field of the profession they want to succeed. That means, they can be either a provider of goods and/ or services. By the way, providing goods and services at the same time is more or less the standard for quite some time now. But in the modern business world, it gains even more importance due to customer preferences to have a complete package for their needs one-stop.
If you produce PC monitors, for example, you also have to provide services around them. Like repair, return and so on. So far so normal.
However, what if you want to provide two kinds of digital goods and one digital service? Based on the same foundation as the Unity 3D Engine as a startup company and almost at the same time? That’s what we want to achieve at 2GuyGames, without the excessive costs, that would usually be entailed.
The tripartite approach that we aim for includes:
being a provider of Unity 3D Assets,
being a service provider for programming needs for companies that use Unity 3D, and
being a game developer.
This sounds like a lot of work, that also needs tons of money be accomplished. In reality, the tripartite approach is in this case not impossible to achieve. Since we will be using the Unity engine as a baseline for all our work, we hope to utilize synergies of all our activities, making it a realistic strategy.
Unity 3D and C# as a programming language provides us with the possibility to develop useful, saleable and supportable assets for the Unity platform. This way, we can earn some money and build up ourselves a bit of reputation in the industry, while also developing efficient processes and tools for ourselves. Furthermore, our programmers can refine their skills, that are necessary for the needs of our future customers by working on assets. By doing so, that means that we can achieve the high quality we strive for as a service provider for programming services.
This way, we can further ensure a stable income to pay employees, bills, hire new staff as well as gain further reputation in the industry and refine skills even more. Then, after a couple of months, it will be possible to scale up to the development of our own games.
Why do we want to scale these three approaches one after another, you might ask?
First of all because of the involved risks. Being a provider of assets and services that can be developed in high quality, relatively easy and fast, is almost without risks. That is, because you generate a periodic income and refine your products. Developing games instead is way riskier. You have to pre-finance one Project over a long period of time and depend on the success of it to refinance next projects, pay bills and so on. Besides, you need a more diverse skill set. Or rather, the experience to be more productive while developing a whole game. Also, you need a lot of planning and forecasting if you want to specify the exact date when your game will be finished. Working as I described before will greatly help in that process.
So in short, you can use the asset creation to get better in programming. Especially when you have to rely on particular programming principles like the S.O.L.I.D. principle to attain a higher code-quality of your work. This set of skills can then be used to deliver a solid (pun intended) performance for customers in terms of price and quality. This strategy promises almost only advantages. The only and major problem we have is, that we need a certain kind of programmer, that is willing to perpetually improve their programming skills.
All of the above can be implemented in a relatively short amount of time (about half up to one year). Still, this concept relies on a mindset that puts constant, but solid growth before rapid growth with high profits.
So you see we believe that a sophisticated structure and growth is more important than the rapid expanding of one business model to be rich in a few years and then be gone. With this hybrid-business-model-strategy, we strike a balance between both axioms. This leads then to what we believe a more sustainable business model that is also way more profitable in the long term.
That’s it for today! Next time Marco will talk more about our internal coding guidelines. Hope to see you there!