Financial Realities of Indie Development
When it comes to the gaming industry, the billions bandied about regarding AAA titles often lead many to think that if your game scores a hit, you are essentially set for life. Unfortunately, the reality is that indie developers often have to pinch pennies or face deficits despite strong sales. Omer Develioğlu, co-founder of Northend Games, offered a breakdown of how $560,000 in income over five years for sales of his games ended up as just $134,000 split two ways, with $73,000 in his and his co-founder's pockets, leaving the co-creator with only $15,000 per year.
The $560,000 gross figure refers to sales for two titles, Northend Tower Defense and Deepstone Rift (Early Access), both sold on Steam for a total of 135,000 units. An impressive 53.3% of these sales came directly from China.
The Impact of Refunds and Platform Fees
The developer noted that regional refund rates were disproportionately large, with $134,000 going immediately toward refunds at a rate of 22%, well above standard averages. After accounting for this, the gross current tally stood at $426,000.
Valve takes a standard 30% platform fee on Steam for developers below the $10 million threshold. This resulted in $127,000 going to Steam, leaving approximately $297,000 for the developers before other deductions.
Taxes and Publisher Cuts
U.S. withholding taxes also applied, taking a 5% slice and bringing the total down to $287,300. Additionally, an Asian publisher took care of PR, distribution, and marketing in China, Japan, and South Korea, taking a cut of $115,000 and leaving the take-home total at $172,000 before local taxes.
Develioğlu did not fully clarify the exact percentage of the publisher's cut, though the $115,000 fee likely refers to sales in Asian countries where the majority of the volume originated.
An independent review of the figures assuming no publisher, lower Asian sales volume, and a reduced refund rate showed that the net amount would have remained nearly identical.
Final Takeaway Earnings
Thailand's tax authorities levied a 15% digital product tax, removing $26,000 and reducing the remaining pile to $146,000. Split 50/50 with his co-founder, Develioğlu earned a personal total of $73,000 for five years of work, averaging roughly $15,000 per year.
While this modest amount allowed him to pursue game development as a full-time occupation in Thailand—where the average annual wage is approximately $5,280—it fell far short of the riches typically associated with a half-million dollars in gross software sales.
Finally, Develioğlu split this 50/50 with his co-founder at Northend Games, for a grand personal total of $73,000 for five years' work, or roughly $15,000 per year of work. As the developer notes, he lives in Thailand, and this comparatively small amount is still more than the country's average wage, letting him make games as a full-time occupation. (For reference, the average wage in Thailand is around $5,280 a year).
But as he says, despite making half a million dollars in sales, instead of buying a Lamborghini, he still drives a 2012 Mazda.
