To start an online gaming business, the first step is usually to plan out your business. This will help you determine how long it will take and what expenses you should budget for. A good place to begin planning is at home, by thinking about what you would like your company to be and the goals that you have for it.
1. Plan Your Online Gaming Business:
A well-planned business is a successful business. So plan your online gaming business in excruciating detail before you even begin to operate it. One of the many things to consider for your long-term goal is if you will be a public limited company (PLC), and what is a company limited by shares?
Here Are Other Matters To Take In Consideration:
1. What types of games do you want to offer?
Which platforms? Will you use custom or off-the-shelf games?
Will you offer virtual worlds and/or chat rooms in addition to the games themselves? How will gamers be able to access their accounts, including payment processors?
For example, PayPal offers an integration tool for embedding its checkout system directly into a website, simplifying the process for customers who wish to pay with PayPal. In this case, however, gamers would have to already have a PayPal account set up in order to play on your website.
2. How will you advertise your business?
For example, will gamers be able to access the games via a website, or do you also want to offer a download client for each game?
If a download client is needed, you will need to purchase a license from the developer of the game being offered so that you can legally distribute it. In addition, any software included in your offering must have open source licenses compatible with GPL.
Developers often sell licenses directly by using Google’s AdWords service. This allows advertisers to bid on search terms and display ads based on keywords found in specific content pages or web pages, another option for paid advertisements.
Again, there are no fees involved if the customer clicks through an ad and makes a purchase from your online store within one month.
3. What will your pricing and payment options be?
If you are using open source games, many of them are offered at no cost. If you are also taking registration fees from gamers to play on your website, you can allow gamers to pay with PayPal if you have integrated it into your online store.
Of course, there is a transaction fee involved when accepting credit cards, but some businesses find this method to be very convenient for customers who do not want to set up an account with PayPal.
4. How will you ensure that hackers cannot access customer financial information?
Many developers offer some form of protection against hackers by enabling customers to enter passwords that protect their accounts from unauthorized users even if the account password has been compromised.
In addition, if you are allowing gamers to generate accounts and play on your website, make sure to enable this feature as well. Allowing gamers to create player-level accounts using secure passwords will ensure that hackers cannot access sensitive information such as credit card numbers or PayPal passwords.
Form a Legal Entity:
Once you’ve determined what types of games your business will offer and how it will operate, the next step is creating a legal entity for your online gaming business. There are many different legal structures available under which an online gaming company can be formed.
The best choice depends on whether or not you plan to apply for patents, where you want to establish physical headquarters if applicable, income levels in the area where you want to operate, and/or how many investors you plan to have.
For example, if your online gaming company will only offer open source games, establishing an LLC is probably your best option. This type of business entity provides limited liability protection for individuals who invest in the company. Limited Liability Companies (LLCs) are based on state law, so check with a legal or tax professional to determine whether or not this applies to you.
Your online gaming company can also be legally formed as a cooperative, sole proprietorship, corporation (S-Corp or C-Corp), general partnership, limited partnership, limited liability partnership (LLP), or limited liability company (LLC). If you choose this method, form an LLC or a corporation.
Register For Taxes:
As with any type of business, you’re going to need to pay taxes on your gaming website’s profits. However, suppose you’re looking for legal protections through an LLC or a sole proprietorship. In that case, you can still set up an online store as a separate entity that will allow you to form an LLC or register as a corporation without giving up ownership of the website.
In addition, those businesses formed as corporations pay lower taxes than those organized as S-Corp or C-Corp because they are considered “pass-through” entities and do not have their own tax liability.
The lack of a dedicated server has kept gamers from moving from arcades and computer labs into their homes. With a website, you can have your own customized server, which allows gamers to play on a secure network. This will also allow gamers to easily find each other and create or join teams for specific games or tournaments if needed.
Obtain Necessary Permits and Licenses:
Many different permits and licenses must be obtained to operate an online gaming store – some more complicated than others, so don’t forget about these required filings while you’re planning out your business structure!
Once you have your legal filings in order, you can begin looking for financing options for your business. Again, this will vary depending on if you are starting an online gaming company or a traditional storefront.
This should give you an idea of how to start and maintain an online gaming business. While it can be a lot of work at first, the benefits of having your own company outweigh all the sacrifices you will need to make. Just remember that once gamers get hooked on your website, they may find it hard to stop playing, which means more money for you.