How I Started A $40M-Revenue Business Creating Tabletop Games

$1.2M
revenue/mo
2
Founders
3
Employees
product
Stonemaier Games
from St. Louis, MO, USA
started October 2012
$1,200,000
revenue/mo
2
Founders
3
Employees
153K
alexa rank
37.2K
followers
21.8K
followers
35K
subs
market size
$159B
avg revenue (monthly)
$1.2M
starting costs
$15K
gross margin
88%
time to build
7 months
average product price
$13000
growth channels
Email marketing
business model
Advertising
best tools
Adobe Suite, Bold Upsell, WordPress
time investment
Side project
pros & cons
39 Pros & Cons
tips
1 Tips
Discover what tools Jamey reccommends to grow your business!
Discover what books Jamey reccommends to grow your business!
Start A Game Development Business

Hello! Who are you and what business did you start?

Hi! I’m Jamey Stegmaier, and I run Stonemaier Games, a tabletop game company based in St. Louis. We publish strategy games like Wingspan, Scythe, and Viticulture.

Stonemaier Games started with a Kickstarter campaign in 2012 that raised $65,980, and in 2020 our annual revenue eclipsed $18 million. Our latest game, Red Rising, is shown here (photo credit: Tim Chuon).

how-i-started-a-40m-business-creating-tabletop-games

What's your backstory and how did you come up with the idea?

I’ve been enamored with both game design and entrepreneurship for as long as I can remember, so when tabletop game projects started to achieve success on Kickstarter in 2010 and 2011, I decided to create a game specifically to launch on that platform.

One mistake I still make (but I’m getting better at it) is to compare myself to others. The result is never healthy for me. Rather, I try to admire and appreciate what others are doing, but not think more or less of what I’m doing as compared to someone else.

I initially designed Viticulture by myself, but when a friend, Alan Stone, expressed interest in helping out, I realized the value in having a partner in the project (someone I didn’t feel guilty asking to playtest every week). We each invested around $1000 in the company to fund art and graphic design for the game, knowing that if the game didn’t fund on Kickstarter, we would probably lose that money.

After researching Kickstarter throughout the entire design process, I spent months preparing the project page and launched it in August 2012. I spent the first-day writing individual emails to every person I knew, sharing how I thought they might find value in taking a minute to check out the project page.

To my great surprise, I also saw several strangers backing the project, and I messaged every backer with a personal note to thank them for their pledge. Many of the ensuing conversations led to long-term relationships with customers, media, and even a future employee.

Viticulture successfully reached and exceeded its goal. It was the first project I’m aware of that didn’t ship to backers from a single source--I used fulfillment centers around the world to send rewards to our 942 backers, a model I wrote about on the Stonemaier Games blog and as a result, is now used by most tabletop game creators.

how-i-started-a-40m-business-creating-tabletop-games

Take us through the process of designing, prototyping, and manufacturing your first product.

Whether it was my first published game, Viticulture, or our most recent game, Red Rising, the process is very similar: If I’m the designer, I go through the 10 steps that I discuss in this video. If I’m not the designer--if it’s a game submitted to us that I love enough to publish--I act as a developer, pushing the game to be as fun, functional, intuitive, and balanced as possible.

Throughout the design and development process, we prototype by simply creating files on programs like InDesign and printing them out, often using spare bits and pieces from our other games to create a playable prototype. After local playtesting has revealed the game to be functional and at least somewhat fun, I send digital files to playtesters around the world for “blind playtesting.” We analyze the reports from those playtesters, iterate and improve the files, and repeat the playtesting process until the game is complete.

During this time, I’m working with our manufacturer (Panda, a Canadian company with their primary factory in China) and our artists (they vary from project to project) to ensure that we can make the game for a reasonable amount and that it will be visually appealing. I also work with a company called Automa Factory that specializes in making single-player modes for our games; their founder, Morten Monrad Pedersen, got his start by designing a solo mode for Viticulture.

The sunk costs for these games include art and graphic design, followed by production, freight shipping, and fulfillment to any direct customers. These costs greatly vary based on the game, the art and graphic design for our games typically cost around $25,000 total. The total time for a game to come to life (from idea to retail release) is typically around 2 years.

how-i-started-a-40m-business-creating-tabletop-games

Describe the process of launching the business.

I didn’t consider Stonemaier Games to be a business until the day Viticulture funded on Kickstarter, though really even that was premature, as I still had to make and ship the games to backers. I kept backers updated throughout that process so they knew what was going well and what wasn’t, and they received their rewards in May 2013.

Viticulture could have been a one-and-done project, I decided to work on a second game while Viticulture was in production. During that time I also started a blog of “Kickstarter Lessons”; a collection of stories about things I wish I had known before I launched. I continue to write that blog to this day, and the core KS lessons are compiled in chronological order here.

It was through those updates and that blog that our audience significantly expanded, leading towards a much bigger launch for Euphoria in May 2013. Euphoria ended up raising over $300,000. At that point I was working two full-time jobs, so I asked my boss if I could take a 20% pay cut to work 1 day less a week. That worked for a few months, and Stonemaier continued to grow through partnerships with distributors and localization partners, and I decided to focus on the company full time starting in December 2013. I had saved up enough to make Stonemaier Games my full-time job for the next year. I kept overhead low by working from home, something I still do to this day.

how-i-started-a-40m-business-creating-tabletop-games

Since launch, what has worked to attract and retain customers?

Stonemaier Games started as a Kickstarter-driven company, and for a while, that was my primary method of attracting and retaining customers. But after a 2015 project that raised $1.8 million for my game, Scythe, we decided to move away from Kickstarter, primarily because we believed we could better serve customers that way.

The resulting model is something we’ve adjusted over the last 6 years, during which time our total revenue has eclipsed $40 million (compared to around $4 million during the Kickstarter years). We focus on crafting a few special products each year; whenever a product has completed production and is close to arriving at fulfillment centers in the US, Canada, Australia, and the UK, I announce it to customers in a series of posts, culminated by unbiased early reviews and a short preorder on our webstore. A few weeks later, direct-order customers have the products in their hands, followed a few months later by the worldwide retail release, then soon after by a release by our localization partners in a variety of different languages.

Any product needs to actually be good to have a long tail, and not all of our products are the hits we hope they’ll be. But for those that customers love, we support them as long as there is demand for those products with reprints, expansions, accessories, community building (Facebook groups), special sales, and a continual flow of review copies.

We very rarely advertise, but I use social media quite a bit to build community and relationships in a variety of ways. On YouTube and Instagram I share my love of games with other designers and publishers. We have Facebook groups for each of our games (for fans to post questions, photos, stories, strategies, etc), as well as a company Facebook page that I use to share blog posts, announcements, and my weekly Facebook live chats. I continue to write twice-weekly blog posts about entrepreneurship and crowdfunding, and I engage with people on Twitter every day, often to answer questions. We’re very active on BoardGameGeek (a social media platform specifically for tabletop games), and I consolidate everything into our monthly newsletter.

While it’s the quality of the engagements that matter to me much more than the numbers, here are some of our social media stats:

how-i-started-a-40m-business-creating-tabletop-games

How are you doing today and what does the future look like?

There’s always room for improvement in terms of how we achieve our goal of bringing joy to tabletops worldwide. Part of that goal involves being profitable and financially sustainable, and Stonemaier Games has never had an unprofitable year. I break down our annual revenue, strategies, experiments, and lessons learned in an annual stakeholder report (like this one from last year).

The vast majority of products we sell are bought by distributors (who sell to brick-and-mortar and online retailers). We sell some products directly to retailers, and we use our webstore to sell directly to consumers who prefer to buy from us. Our localization partners account for around 5% of our revenue.

One of our biggest differentiators is the Stonemaier Champions program, which we started in 2018. The idea was to give people a way to contribute a small amount of money (now $15/year) to support the 100 blog posts I write each year to support other creators and the 150 YouTube videos I create each year to support other designers. As an added perk, Champion orders on our webstore are prioritized above other orders, and Champions get a 25% discount on everything they order from us (among other special deals throughout the year). The Champion program started with a few hundred members and has grown to 9,200 members as of today.

My preferred method of marketing our products is to focus on 1-2 new games each year and a few supporting products (expansions and accessories). This allows us to give each new product the attention it deserves and the best chance at becoming an evergreen product. So I expect that we’ll stick to that method for years to come.

This photo shows designer Elizabeth Hargrave receiving one of gaming’s most prestigious awards for Wingspan, our bestselling game.

how-i-started-a-40m-business-creating-tabletop-games

Through starting the business, have you learned anything particularly helpful or advantageous?

When I think about things I’ve learned, I typically think about mistakes I’ve made and how I’ve tried to improve as a result. Early on I learned the value of budgeting, especially in regards to Kickstarter stretch goals--there is a metal coin stretch goal that we didn’t reach on the original Viticulture campaign that could have easily bankrupted Stonemaier Games after that first campaign.

I also learned early on that any news (good or bad) is better than no news when you have customers waiting for a product.

One mistake I still make (but I’m getting better at it) is to compare myself, Stonemaier Games, and our products to other creators, companies, and products. The result is never healthy for me. Rather, I try to admire and appreciate what others are doing, but not think more or less of what I’m doing as compared to someone else.

What platform/tools do you use for your business?

I actually have two blog posts on this very subject:

What have been the most influential books, podcasts, or other resources?

The business-related book that has probably had the biggest impact on me is Rework by David Heinemeier Hansson and Jason Fried. It confirmed that there’s a lot of unnecessary stuff that companies do simply because they think that’s the only way of doing things. If you cut that stuff (like meetings), you free yourself to focus on what really matters (people--customers, employees, and yourself).

Also, I have a book about crowdfunding that I genuinely believe will help any potential creator. It’s called A Crowdfunder’s Strategy Guide.

how-i-started-a-40m-business-creating-tabletop-games

Advice for other entrepreneurs who want to get started or are just starting?

A lot of modern creators start with a Kickstarter project, and my main advice, if you’re doing to do that, is to go back 5-10 projects right now (even just for $1 each) and follow each of them closely to see what you like and don’t like about the way those campaigns are run. Even though I don’t run Kickstarter campaigns anymore, I still learn a ton from doing this.

Are you looking to hire for certain positions right now?

I was Stonemaier Games’ sole full-time employee until 2020, at which point I hired a Director of Communications and a Director of Sales. It was a big leap to go from one employee to three, and while I don’t intend to expand our internal team beyond that (it’s far more efficient for us to outsource to independent contractors only when there’s work to be done), I’m grateful for what Joe and Alex have added to the company.

Where can we go to learn more?

Everything we make and all of the different places you can connect with us is listed on the Stonemaier Games website.

If you have any questions or comments, drop a comment below! While I’m not available for a private consultation, I love the generosity of having public conversations about the topics discussed above, so feel free to join the discussion in the comments on my blog, YouTube channel, or anywhere else.

-  
Jamey Stegmaier,   Founder of Stonemaier Games
Pat Walls,  Founder of Starter Story

Want to start your own business?

Hey! 👋I'm Pat Walls, the founder of Starter Story.

We interview successful business owners and share the stories behind their business. By sharing these stories, we want to help you get started.

Interested in starting your own business? Join Starter Story Premium to get the greatest companion to starting and growing your business:

  • Connect + get advice from successful entrepreneurs
  • Step by step guides on how to start and grow
  • Exclusive and early access to the best case studies on the web
  • And much more!

Did you know that brands using Klaviyo average a 95x ROI?

Email, SMS, and more — Klaviyo brings your marketing all together, fueling growth without burning through time and resources.

Deliver more relevant email and text messages — powered by your data. Klaviyo helps you turn one-time buyers into repeat customers with all the power of an enterprise solution and none of the complexity.

Join Brumate, Beardbrand, and the 265,000 other businesses using Klaviyo to grow their online sales.

Try Klaviyo for free right now ➜

Leave a comment
Your email address will not be published.

Want to start a game development business? Learn more ➜