The Game Developer's Crash Course in Lifetime Value (White Nights Conference Prague 2017) The official conference website — http://wnconf.com

1. THE GAME DEVELOPER'S CRASH COURSE IN LIFETIME VALUE:
CREATING A MARKETING BUDGET AND FUNDING YOUR GROWTH

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WHAT DOES POLLEN DO?
Early access to funds, paid direct
to your bank account
Seamlessly finance marketing
spend through top ad platforms
Unbiased guidance for UA
campaigns & financial planning
We give app developers early access to revenues they’ve earned from the app stores, so they
can rapidly reinvest in the resources they need to grow their business faster
Creating a marketing budget and funding your growth

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THE CHALLENGE: THE APP
PLATFORMS ONLY PAY OUT
REVENUE UP TO 60+ DAYS
AFTER YOU’VE EARNED IT.
LAUNCH
You’re earning money from day 1
This is your money
trapped in the payment system
Platforms release
your cash…
Creating a marketing budget and funding your growth

4. Creating a marketing budget and funding your growth 4
MARKETING BUDGET
7 STEPS

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STEP 1: MIND THE FU**ING GAP
Financial challenge
If you’re stuck in a cycle of spending / waiting for the payout, you’re going to need to
keep replenishing your UA budget from another source
Solutions?
Credit card or other external source such as your seed fund, which can spell trouble
for your relationships with investors, and limit your ability to raise further investment
Without a plan to plug the funding gap, even the most successful and well-funded app
developers can run into financial problems fast
Creating a marketing budget and funding your growth

6. Creating a marketing budget and funding your growth 66
STEP 2: ALIGN DESIGN & BUDGET
Reinvest
into advertising
Acquire more
users
Receive your
earnings
Game design + budgeting = $
• Aligning game monetization with appropriate
budgeting, especially critical in the early
stages of your app
• Build custom budget to account for your app’s
unique characteristics

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LTV: Put simply life time value is the amount of revenue you expect to
generate from a single user in the time between downloading the app and
abandoning it
Factors: You need to be able to understand the different factors that
influence LTV for each cohort throughout the app marketing funnel
Users: Calculating your future profits confidently requires detailed analysis of
profitable cohorts
Funnel: Also look at how effective your marketing funnel is for each
profitable cohort and how this can be optimised
STEP 3: KNOW YOUR LTV
Creating a marketing budget and funding your growth

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STEP 4: MAP YOUR PAYMENTS
Creating a marketing budget and funding your growth
Align your calendars for efficient operations
App stores (Apple, Google, Amazon, etc.) and ad networks (Fyber, IronSource, Tapjoy, etc.) calendars have different payment cycles -
overlay your projections accordingly

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How long before
you receive the
revenue?
Understand and
optimize costs to
acquire a user
The revenue
they will
generate
++
STEP 5: MARKETING FORMULA
Creating a marketing budget and funding your growth

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The app stores are intensely competitive and you need to
ensure you have the funds to promote your app and
acquire users effectively.
But how do you finance user acquisition without a
substantial marketing budget when your revenue is tied up
in the app stores?
THE REALITY IS THAT YOU
NEED TO SUPPORT YOUR
APP WITH PAID UA
Creating a marketing budget and funding your growth

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Unlock the value of your
earnings to fund growth
Think of your accrued app
store earnings as an untapped
asset
Creating a marketing budget and funding your growth
STEP 6: USE YOUR REVENUE TO
YOUR ADVANTAGE

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KEY BENEFITS FOR DEVELOPERS
Do more with your money at an earlier stage: Earlier access to
your revenue enables quicker investment into user acquisition earlier, so you can
maximize your app’s growth potential at critical points in the app life cycle
Keep control of your business: Using revenue recycling reduces
reliance on external capital which dilutes your equity, or involves revenue share with
publishers
Improve your chances of Self-Publishing success: You can
capitalize on your revenues, especially from free traffic events (featuring, influencers,
etc) to finance your growth and self-publish
Creating a marketing budget and funding your growth

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KEY BENEFITS FOR INVESTORS
Sustainability: Early access to cash means SMB/SME developers have a better
chance of survival, ensuring a healthier ecosystem in the long term, as top-level
incumbents are replaced by newer players, generating new users and sales
Improved capital efficiency: VC backed companies are able to deploy
their venture money more effectively as they don’t need to tie up a chunk of venture
financing into marketing spend
No dilution or revenue share: Pollen VC provides an alternative for
companies who are seeking to strengthen their cash flow position without the need to
raise more equity capital
Creating a marketing budget and funding your growth

14. Understand payback periods, and how to avoid cash flow gaps
Model financials based on metrics to show how much UA you
can fund, and how quickly you can grow
If your cohorts are not delivering, optimize your marketing
funnel and deploy capital when ROI is positive
Pollen VC created Financial Forecaster - a tool using readily
available metrics of retention, ARPDAU, and CPI to help developers
understand and model LTV
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STEP 7: OPTIMIZE CASH FLOWS
Creating a marketing budget and funding your growth

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STEP 5: OPTIMIZE CASH FLOWS
PLANNING A MARKETING BUDGET FOR MOBILE GAMES
calculator.pollen.vc
calculator.pollen.vc

16. Creating a marketing budget and funding your growth 1616
WHO SHOULD USE FACTORING?
Is your marketing profitable?

17. Creating a marketing budget and funding your growth 1717
WHO SHOULD USE FACTORING?
Use financing (bank, factoring, venture, angels) only if you are ROI positive

18. CASE STUDY: TIMING + $ = $$$
Creating a marketing budget and funding your growth 18
No marketing, organic only
$5-10 a day
Start paid UA
Use revenue recycling to reinvest in marketing
From $200 to $60,000 a month

19. @PollenVC
calculator.pollen.vc
denis@pollen.vc