In the 1980s, it was feared that the world’s economy would be controlled straight out of Tokyo and that those fearsomely inventive karate choppers would own our houses and maybe even our pets, deigning to lease Fido back to us once Reagan ratified the switch to yen. We would all have to play pickup sticks with our MakuDonarudo french fries. And we would all have to be conversant in the Japanese language, especially the onomatopoeia - the Japanese have an onomatopoeia for every. damn. thing.
Don’t believe me about the onomatopoeia? Let me convince you. Exhibit A-through-Z: In Japanese, the sound of “groping somebody on the subway in Ginza” is “momimomi” (“もみもみ”).
Luckily for us Americans, then-Senator Al Gore had the very potent foresight to first found the small village of San Francisco, nestled away by ocean and bay in the rugged northern reaches of California, and to there devise a distributed computer network for crowd-sourcing the coining of onomatopoeia, “ARPANET.” The race with Japan was on like majong. After President Gore’s impassioned plea to the nation, declaring a grand priority to before-the-end-of-the-decade beat those industrious karaoke crushers to the onomatopoeia for “masturbation,” we, as a people, came together in triumph, “Fap! Fap! Fap!”
And the rising sun faded …
On the north-side of the city, I live across the street from a high school. Outside of my loft, students congregate, and, as I exit and enter, I am bombarded by loitering minors who beg me to buy them Swisher Sweets mini-cigars. I have often fantasized about mugging those students, as I am willing to bet that half of those kids’ parents packed USD 200K convertible notes in the kids’ lunches, just in case a good angel investment opportunity popped up on the way to class. Most days it seems that the streets of San Francisco are paved with cash and code and kids begging for cigarillos.
It needs saying that I ain’t scared of no yuan.
Have you ever failed so badly in your endeavors that you cascaded into a debilitating and existential crises of confidence? The kind of personal-bottom where empathy is amplified beyond the skulls of others and into the skulls of their friends and family? The kind of rot in your belly where you will not only tell a stranger the time-of-day, but also buy him a beer and listen to what he has to say, with no hope of reciprocity? Well, feel better: You still suck at failing.
There’s a saying here in venture capital, “You aren’t anybody until you have failed three times.” Which works out for me, because I am the most-spectacular failure in games industry history: The commercially flaccid Sega Dreamcast, the awesomely horrible Nokia N-Gage, the unfortunately overlooked second Nokia N-Gage, the always forgotten Pocket Kingdom (the first global, massively multiplayer mobile game), and, for extra measure, Reset Generation (especially frustrating, because, when you lose the Interactive Achievement Award, they send you a picture of the award that you could have won, encased in glass).
For years, the press had been applauding me as a rising star: Escapist Magazine named me as “one of the top-three game developers under thirty” - which inspired a deeply rational panic as my thirtieth birthday approached, until EDGE magazine saved me with “one of the eight talents that will change the future of gaming,” and then, a six-page feature-article (with my face on every page), entitled “Great Scott.” And still, consumers would be pressed harder-than-diamond to name even one game that I have designed or produced.
The next time you find yourself ravaged and remiss about dice not rolling the way that your bets were placed, look up “Games Industry Failure” in the dictionary and find a grin. You’re probably going to see a picture of me - and I’ll probably be featured wearing a tracksuit.
They say you can never go home from here, but, if I could go home from here, I would marry the year 2009 and have make-a-baby-sex all night long.
It was a time of violent market disruption: The minimum barrier to entry for the games industry had become barely minimum. Publishers were replaced by investors. Products were replaced by platforms and services. Price elastic and freemium muscled in on paid and subscription-based. Lean murdered agile. Data Science took its seat on Organizational Olympus beside Design, Programming, and Visuals. It could no longer be questioned that operational efficiencies rival intellectual property in value.
The once evergreen Game Boy didn’t really count anymore and San Francisco defiantly punked the now obviously naked emperor cities of Los Angeles, Seattle, and Montreal by saying, “You fools couldn’t hold my bridge.”
I am too entrepreneurial-minded a manager to be working for Fortune 100 companies, both in the Drukerian sense of shifting resources from low-yield activities to high-yield activities, but, also, I just love tracksuits - they’re like pajamas that you can wear outside. (Once you go track, you’ll never go back.) Leaving N-Gage in 2009, I launched my home office with the help of a few close friends to whom I gave very simple request, “Get me consulting gigs: Any consulting gigs.”
In any industry, it’s not who you know, but who knows you. From speaking with people who knew me, quite quickly it became apparent that failures are securities: Much like debt, failures can be packaged and sold, and, unlike other much-maligned securities of recent years, failure is an investment that pays buckets.
If it can go wrong in games, I have seen it go wrong: My Geiger counter for failure is so sensitive that I can tell you from what horse came the hair on which the Sword of Damocles hangs. I’m a god damned Foestradamus, the walking and talking and smoking tail of the experience curve. And, when it comes to starting up, what are first-in investors buying if not the value byproduct of failure?
Turn around a social game production that has come way off the rails. Design a location-based alternate reality game; design a location-based augmented reality game. Design a dating game. What are best-practices for Facebook games production? What should our Minimum Viable Product be? Do our monetization design. Can you help us staff up engineering? Staff up design? Can you fix our design? Design our metrics and analytics. Adobe Flash developer audits; mobile developer audits. Can you polish our pitch deck? Help us set up our studio. Design our operations and production systems. Plan our P&L. Be our game director. Be our executive producer. Sit on our Board of Advisors. Sit on our Board of Directors.
Trust me when I say that you can trust me. We’re going to have to recapitalize. Sorry, we just can’t make cash flow this month. We’re pivoting out of gaming. Can you get the team to crunch even harder? The investors are pulling out. A new investor came in and he wants to wipe the board clean. When we said we had seven hundred thousand dollars, we were really counting on more investment coming in. The CEO and the COO have decided to part ways; when can you talk to the lawyers? We can no longer afford catered lunches!
Sega and Nokia were both amazing experiences in their own rights, however, both were insulated experiences. Over these wooliest years, I have worked with thirty-plus mobile or social gaming startups, some backed by Americana entertainment mega brands, and others backed by nothing but a pitch and a prayer. If you had told me three years ago that today I would be an advisor to an investment bank, I would have flicked you in the shaft - unless, of course, you were, at that time, a girl.
While the failures have not been so spectacular as in my past-life of big companies behaving badly, the failures have been much, much faster - also unlike my past life, I have many offices peppering the peninsula, some of which sell coffee, some of which have free Wi-Fi, some of which are like the opposite of a nudist colony - tracksuits only.
The human brain is intrinsically tuned for optimism. No child grows aspiring to become an addict, a prostitute, or a games middleware sales rep. Even my mother, who is the most pessimistic person on the planet Earth, could not bring herself to name me after a Bobby Goldsboro song called “Watching Scotty Fail.” But, had dear mom been so uncannily prescient, she would have sent me to Mega Startup Weekend long before I was recently invited there to judge a pitch competition.
MEGA STARTUP WEEKEND
Mega Startup Weekend is an event for get-it-done-type people, expertly assembled and run like a multi-core processor by the cleverly named Startup Weekend company. In the conference organizers’ own words, Mega Startup Weekend is “an intense 54 hour event which focuses on building a web or mobile application which could form the basis of a credible business over the course of a weekend. The weekend brings together people with different skillsets - primarily software developers, graphics designers and business people - to build applications and develop a commercial case around them.”
In my own words, Mega Startup Weekend is, “Tits. It’s the startup experience compressed into three days, and it has the word ‘mega’ in the title. One of the very best games events that I have ever attended.”
(There were actually three conference tracks, “Health,” “Education,” and the exact-opposite of “Health” and “Education,” which is “Gaming.” The big winner for the weekend would be awarded a spot on stage at DEMO.)
Day 1: Attendees get right to business, pitching game ideas to each other, in pecha kucha-style short-form presentations. Attendees select the best ideas and form teams around them: A designer here, a couple of engineers from over here. (Pro tip: You don’t need five biz dev guys on your team.) Once the teams are formed, they get to work on building a pitch deck for their new business and a prototype of their new product or service.
Day 2: The teams work together, building prototypes, surveying potential customers, compiling market forecasts, and becoming more than strangers.
Mentors (one of whom was me) help the teams refine and strengthen (or even abandon) their strategies and tactics, their products, their services, their pitches. This was like a year of my career in one day: I visited with all of the teams and offered the boons of failure. (I also gave one of the teams from the Health Vertical a little nudge with my own brand of amateur dentistry.)
Day 2 Party: It is important to note that Microsoft hosted the weekend, and, just to give the newly zygotic startup teams something to aspire to, Steve Ballmer dropped more coin than some companies get in Series A funding on a boozey bash that featured a defiantly entertaining 90’s cover band that covered Save Ferris covering Dexys Midnight Runners - don’t think too intensely on that point as I don’t have liability insurance for this web log.
Day 3: The teams have five minutes to pitch and demonstrate their new product or service, and two minutes to answer questions from the judges (one of whom was me). The judges deliberate and a winner is chosen.
The Gaming Vertical Winner: "Frennzy," the truly-social winning team from the gaming vertical, was offered a spot in the YetiZen Accelerator program, should they choose to stick together as a corporate entity following the event. YetiZen is a San Francisco-based gaming-focused startup accelerator program that offers class companies insanely networked capital introduction and sage and veteran mentoring from all walks of the industry. (Being an advisor to YetiZen Accelerator, I know that hundreds of companies apply to YetiZen each class, and only a small handful are chosen, so, this is quite the prize.)
They should call “Mega Startup Weekend,” “Mega Failure Weekend,” but they wouldn’t sell as many tickets: I have never seen so much failure in one room and it was uncompromisingly glorious! Take it from somebody who lives in this world: As much of the terrific and as much of the tears of the San Francisco startup experience as can be, they are all there, they are all in three days. (The only thing that could make the proceedings more authentic would be if teams were forced to hire the founders’ completely inexperienced relatives at $200K-a-year salaries and 20% equity stakes.)
Even if you are allergic to lightning-fast execution … even if you cannot consider using the bathroom without sign-off by your business unit vice president … even if you could not go a day off of your massive corporate intranet without being weaned by methadone, go ahead and use that expense tool from the accounting department to buy a ticket to Mega Startup Weekend.
Mega Startup Weekend should be near the top of every game developer’s bucket list. Oh yeah, while you’re expensing stuff, go ahead and grab a tracksuit; the three days just wouldn’t be the same without outdoor sleepwear. And, if you are so lucky as to fall flat on your kisser, do keep in mind that the onomatopoeia for failure is, “Whaaaa Whaaaaa!”
Joseph is a former games publishing exec who turned angel investor; currently, he serves as director of the Silicon Valley chapter of the International Game Developer Association and as a member of Keiretsu Forum's Software Committee.
It is said that a key advantage to the Silicon Valley startup scene is the ability to fail and be forgiven, as long as you've learned from the experience. Failure in Silicon Valley has been refined to an art form, as adopted by Lean Methodology. (Study It!)
Break your fallible endeavors into bite sized chunks. Fail early and often. Measure and understand each failure, learn to fail better each time. One success can balance a multitude of failures.
A bountiful supply of failure is always near at hand, closer than you may realize.
One of the best ways to learn from failure, is to study the failures of others. This removes the personal sting from the lesson, but lessens the imprinting of it.
Learning from the failure of others is complicated in that they are seldom advertised by the original practitioner.
There are one hundred and one varieties of failure, try not to learn them all first hand.
One certain way to fail is to become arrogant in success.
Never forget that failure is not an end in itself, unless you leave it that way.
Sana's bio is longer than this article (if you can believe that) - so, short and sweet, Sana is a scary bad ass who has spent her entire career in startups and entrepreneurship. Sana is a leading member of Women 2.0, Startup Weekend, founder of UltraLight Startups, and co-founder of both SF Game Developer's Workshop and YetiZen gaming startup accelerator program. (Also, if you're wondering if Sana is egging my face with her comment, the answer would be, yes!)
Nowhere in the world does the economic principle of ceteris paribus, "all other things being equal" come up more than in Silicon Valley views on how startups succeed. In the discussion of startup failure we are using the same principle - if all other things are equal investors are more likely to invest in those who have failed than those who have not. If all other things are equal you are a wiser entrepreneur from having learned through failure than being born right or being a genius in an island of his or her own.
Like in economics all of us use ceteris paribus to help explain benefits of startup failure because the real world has a lot more greys and variety. If we were to explain all of those this blog post would continue for ever.
Over the last few years we have taken startup failure and ceteris paribus to new heights. Probably as a response to the many conferences, blog posts, networking conversations that are all focused on sounds bytes of how businesses, founders are smarter, bigger, leaner, meaner. Heck my close friend Cassie Phillips even started a conference focused only on talking about failure that is expanding globally (must check out if you are doing a startup).
As always it is helpful to talk about situations where ceteris paribus does not hold true because that is where progress lies. Glorifying failure does not lead to better startups, founders, strategies or better anything for that matter. What matters is what have you learned from the failure. How does that change your thinking? Can you demonstrate that in your startup plans and execution?
Don't just fail and wear it like a proud badge. Don't just tell me about your failures. Tell me what you learned from it, how you are changing your business for it and what checks do you have for being closer to similar or new failures in the future. How will you handle that.
Got those answered? Now I'm interested. Let's talk.
Badge of Honor. That's what investors call failure. Without this badge, you are a risky investment. Without this badge, one can not truly find success in either gaming or the Bay Area. Why is real success elusive to those who haven't failed? Without struggle entrepreneurs will not learn the lessons needed when they face real conflict. Real success comes when entrepreneurs surmount giant mountains. Getting up that mountain you will slip. If you are not prepared to find reassured footing after you slip, you will fall all the way down that mountain. Investors know you will face conflict and you WILL slip. This is not a question to an investor. But do you have the lessons learned from previous failure to not slip back to the bottom? Do you have the failure experiences to know where to catch yourself when you fall? This ... this failure ... is your badge of honor. To get through the investor door you will need to show your badge of failure at the check-in.
Aaron was the designer/leader of the team that brought us the Mega Startup Weekend-winning game "Frennzy" - a hot-potato mobile title that can give you and your friends something to do in bars (besides black-out drinking). Before spinning up his own company, AJC Games, Aaron was a sixteen-year veteran of the games industry, most recently serving as Executive Producer at Total Immersion.
As the biggest failure at failing in the Failure-at-Educating-or-
That freed us to do whatever felt cool, and let us focus on the product rather than the competition. The company we failed to dissolve at Mega Startup Weekend is continuing to fail to dissolve, and we are excited at the chance to spread the fail at YetiZen next year! Since we failed to achieve failure during the weekend, we are pivoting to build mass, aiming to make a spectacular lightshow on re-entry; a meteor so bright WaWa is going to hand out branded pinhole-in-cardboard things like they gave you in elementary school to watch the solar eclipse, but you couldn't help it and looked directly at the sun anyway, and those teachers lied and it didn't make you go blind.
If we fail to burn up on impact with the atmosphere, we are aiming for a crater of fail at least 8 digits across. (Cue Slim Pickins.)
To anyone on the sidelines, get off your ass and do it. You either a) own the shit out of a completely new industry, b) get acquired, or c) throw off the yoke of oppression, meet kick-ass people, and have fun. Win win win. Now get out there and whoop up some epic fail!