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Rand Fishkin announces that Snackbar Studio raised $2.15M from 38 angel investors for its first indie game, using the funding model he created at SparkToro. He explains how the structure works, shares the pitch deck, and open sources the 12 incorporation and funding documents for other founders to use.
We link to the original and never republish it. All credit to Rand Fishkin.
Key takeaways
- Fishkin's model is one priced round from individual accredited investors, sized so the company can run profitably without raising again if the first product does even moderately well.
- Founders can repay investors their initial sum at any time, after which everyone shares in profits through dividends, and founder salaries stay capped until that repayment.
- Neither company has a board or investor veto on a transaction, but investors get repaid first in an acquisition and are protected from dilution and share class tricks.
- Almost all 38 investors came from the founders' personal networks, and Fishkin says raising this way is very hard without people who know and trust you and have cash to invest.
- The hardest part of the raise was a polished, playable demo: 4 people worked full time for 9 months before funding, versus about 3 months of research before SparkToro raised.
Who it's for
Founders with a network of accredited investors who want a profit-sharing alternative to VC, publisher funding or bootstrapping, especially in a field where venture money is a poor fit.
Why it's worth your time
It pairs a real, open-sourced alternative funding structure and pitch deck with an honest account of what it took to raise the money, including the limits of relying on a personal network.
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