Advantages and Disadvantages to Financing Techniques.

Self Financing:

Advantages: One of the main advantages to self-financing is that is your own money meaning that it will be secure and you won't need to worry about pursuing a loan. Leading to my next point that you won’t have to deal with things like shareholders that can have a dramatic effect on your profit so that you will have all the profit for yourself. The final advantage is that if you were to be unsuccessful with whatever you were financing, leaving would be fairly simple and you wouldn’t have to worry about debts and nothing else to negotiate.

Disadvantages: The main disadvantage is basically not having the correct funds, which will ultimately mean you won't be able to achieve the things you originally wanted, this could also dramatically impact how well your business grows in the future. Another disadvantage is that if the product you are financing flops and you can’t carry on with the funding then all the responsibility falls to you and you alone meaning you will have a lot to deal with alone. My final disadvantage is that the sole provider may not have all the knowledge and skills needed to run the business on their own, meaning that you are putting yourself at risk of failing or doing something wrong which could ultimately lead to my previous point.

Indie Funding (Indie Fund & Games Lab):

Advantages: The main advantage with using something like 'IndieFund' is that it is very simple to use. Another advantage is that they can fund you as much as you need so you won’t have to worry about not having enough funds to supply your product. My final advantage is that the company will have good knowledge and will have a wide variety of skills that they can apply to your funding and you can be in touch with a skilled member of their team all the time.

Disadvantages: The main disadvantage when using indie funding would be that it is not just your idea anymore and now that you have let people fund you, you are also letting them influence your decisions. Taking off from my previous point this means that you will also lose a great deal of the final profit due to you letting them fund you; less control, less money. My final disadvantage to using Indie Funding would be that if your idea was to fail then you are going to be in a lot of debt with these companies and with no product to make money from you are going to be strapped for cash.

Crowd Funding (IndieGoGo and Kickstarter):

Advantages: The main advantage to using a platform like KickStarter is that you are not having to pay for any of this money, all you have to do is make a good pitch and if consumers deem your product worthy, chance are they will fund it. Another advantage is that people won’t feel pressured to pay large sums of money but instead will rest on many people paying small amounts of money that will add up to your asking price. My final advantage is that if your product was to fail you haven’t got any actual responsibilities to pay any of the funders back so you won’t be losing any more money if the product fails.

Disadvantages: My main disadvantage is that not everyone is going to want to fund your products and chances are, a lot won't. Primarily down to the fact that people want to throw their hard-earned money away and you will have to make a great pitch or have a great product for people to donate their money. Another disadvantage is that if you enable ‘Flexible Funding’ on your KickStarter page meaning that even if your product is not fully funded then the money will still be yours and this will turn a lot of people away that they won’t be refunded if it fails. My final advantage is that KickStarter will take away a certain percentage of your profit for being the middle man, they take roughly 5% of your profits, which may not seem a lot but it’s still profit you won’t be earning.

Grants (Unreal Dev Grants):

Advantages: The main advantage is simply that grants are essentially free money, who doesn't love free money? Another advantage is that there are plenty of Grants out there for the taking and you just need to do some research to find them. My final advantage is that unlike a loan, Grant money doesn’t have to be repaid and this is why many people will use these to fall back on.

Disadvantages: The disadvantages outweigh the advantages on this one in my opinion, the most important one being that you will have to spend many, many hours looking for a grant that suits your needs. Leading to this disadvantage that even after hours of research to find your exact Grant you need there is still a high chance you won’t even be given it. My final disadvantage is that it is very competitive to look for a Grant and there are a lot of people out there looking for Grants that you will have to compete with, this can add even more hours to the time consuming aspect.

Publishers (Activision, EA, Bethesda):

Advantages: That it would be a great start to your product if you can get it published by a largely famous publisher like Bethesda. Another advantage is that if you are taken under your wing by a huge publisher then a lot of the prices will be soaked up and won’t cost you as much as compared to self-publishing. My final advantage is that these Publishers will be very experienced with what they are doing and will have extreme knowledge on the best steps to take.

Disadvantages: The main disadvantage is that it will take a lot of hard work in order to be noticed by a huge company like EA or Bethesda and could be deemed more trouble than it's worth. Another disadvantage is that it can take a long time for it all to go through sometimes up to 18 months for your product to be fully published. My final point is that you are not in very much control over your product one you hand it over to these publishers and they can adapt any which way they please, meaning you are likely to lose what you had in mind originally.