Last night I went to the SEA Spring Showcase to listen to Mark Otero’s story. I’ve followed him somewhat over the last year or two. Not stalker like follow but I always take notice when I see or hear his name. Stories like his are unfortunately not common in Sacramento. He built KlickNation, a video game company in the county that supposedly lacks the creative talent for such an endeavor. I myself am guilty of childishly lambasting an NPR advert for a job that to me appeared to require too many tech skills for one single individual residing in this county in particular. Listening to Mark, I realized how ridiculous and contradictory some of my ideas and feelings are. On one hand I believe that MOOCS and online education in general have made it possible to learn anything, anywhere. On the other I also believed that I needed to get the hell out of Sacramento in order to locate the creative team that could deliver me the promise land of innovation. In Mark’s story passion trumped experience and led to the creation of a very successful game and the company’s purchase by EA/Bioware.
How did Mark do it? He talked himself into it for a year and a half or so. He was getting promotions at work but his heart was yearning for something more and his work started to suffer. I’m sure all you budding entrepreneurs can relate to that. Mark’s a bit different from most I’ve met though. Instead of chasing the dream while safely harnessed to his day job, Mark decided in order to to find the courage he needed to pursue his best use he had to “burn the ships.” For Mark this meant selling the home he had invested in extensively and loved, selling his possessions and moving back in with his parents. How many of you are ready to do that? I told my wife about this and she jokingly (I hope) told me that if I decided to do that she would burn my mom’s house down. Fear not mom, I intend to stay in my humble home.
What did Mark do next? Well, he did just what I would probably do. He slept a ton, ate junk, and watched TV for a few months until he grew bored of that. Personally, I think breaks like that are essential. I’m much more productive if I get that kind of time every year or two however the corporate grind doesn’t generally allow for that. The better companies offer sabbaticals but I’m all for unpaid time off if you need it without stigmatization.
Back to Mark and his boredom. Next, he took the cash he had from his 401K, bought the failing coffee shop on the corner of P and 16th, and turned it into Mochii Yogurt. The little shop was immediately profitable and he coded aps with his partner in the upstairs office while using the profits from Mochii to keep afloat. Most of his attention was spent on ap creation and his sister fortunately stepped in to manage Mochii while simultaneously working full-time elsewhere. Mark made it clear that his family played an important role in his success.
How did he go from coding atop a frozen yogurt shop to KlickNation? The hard way, through 30 failed aps and multiple partners. According to Mark, he was trying to chase the successes that had emerged out of Silicon Valley and follow the winning recipes. He was also relying on Ad Sense and it was not working. They had aps with significant numbers of users but the click through rates on the ads were not enough to make a profit. Mark mentioned that Facebook charges companies for each user who installs your product. This makes turning a profit all the more difficult. My take-away was that your product better have virtual goods built in if you want to survive.
Mark turned a corner when he decided to go after his true passion: video games. They needed a team so they posted an ad on craigslist highlighting that the pay for services rendered would be “shit” or nothing but in exchange you would be a part of something “fucking” amazing. They received 40 applications. The emerging team had little experience but passion made up for it. I think Mark said that the development cost was around 50-60k all in all. They did try in feed the team pay for server space. A 40k line of credit paid for FB advertising during launch and at that point it was do or die. That’s when the money started to roll in and Mark’s status changed from lunatic to brilliant entrepreneur.
I wish I had Mark’s presentation and I know SEA was recording because it’s definitely worth watching. I’ll post it here if I find it. Full of f-bombs and hilarity as well as life lessons. The lesson I got from it was this: believe in yourself, burn the ships, believe in yourself, your going to fail a shitload, believe in yourself, your going to fail a bunch more but you will learn, believe in yourself.
MARK OTERO? (bio from sealink.org)
Mark Otero is a serial entrepreneur and a social game expert who co-founded Sacramento-based KlickNation in 2008—one of the fastest growing innovations companies in the Sacramento region—and nurtured it into an energetic multi-million dollar operation that quickly became one of the leading makers of core social games for Facebook®. With a reputation for creating astonishingly fun, ferociously addictive games that run on social networks, KlickNation caught the attention of entertainment giant, Electronic Arts Inc., who acquired the start up in late 2011. Today, Mark heads up BioWare Social for the global leader in digital interactive entertainment. Mark received his Bachelor of Science degree in Computer Science from the California State University at Sacramento (CSUS) and his Masters in Business Administration with a Marketing concentration from the University of California, Davis in 2007.