A practical beginners guide to starting a game company in the Netherlands

In this guide we’ll focus on the practicalities of starting a game company in the Netherlands. Any best practices on how to run and manage a game company are not part of it. It’s always important to do your own research as this is not legal or financial advice, however we hope that this guide will help you in your first steps!

I want to start my own game company! Where do I start?

The first thing you need to consider is if you want to be creating games for a living or as a hobby on the side. If you’re creating games as a hobby you don’t need to be a registered company to release on most popular digital platforms, as many allow individuals to publish their own work. You can find the required information at the platform documentation you want to release on. However, we would always recommend seeking out professional advice for your situation from the Chamber of Commerce (Kamer van Koophandel) and/or an accountant. As there are different criteria if you’re seen as an entrepreneur by the Dutch authorities for income tax purposes, VAT (BTW) and the Chamber of Commerce (KvK)

Yes, I really want to start a company

While complete books are written about the subject, make sure you do spend time thinking about what you want to achieve and how you plan to do so. This can be done by writing a business plan (or similar tools) and by going through this process it can increase your chances of success. For example think about your qualities, what your goals are, why you are starting a games company in the first place, what you’re building, how you’re going to build it, how you’re going to sell it, who your target audience is and what do you need to make it reality (financial and other assets). This may seem like a lot of work, but if you want to make a living you’re not only building a game but a games company as well.

A business plan and strategy don’t have to be perfect and will change over the course of time as you learn and grow. At the very least, it certainly helps you make choices for your company and identify gaps or blind spots.

Money

One particular topic in the plan that often comes up with new entrepreneurs is how do you get money required to build your company. Depending on your goal, this may require as little as a solo developer doing game development part-time to large amounts of money to sustain a full-time development team for years. Some options are: Your own capital (‘bootstrapping’), friends or family loan or investment, angel investment, venture capital, bank loan, grants or building capital through work-for-hire. Depending on your needs and situation, some are more realistic options than others and each comes with their own challenges, risks and downsides. Research and explore the different options and offset it against how much your game(s) will have to make to break even or be a successful hit (through direct game sales, microtransactions, advertisement or otherwise make money).

Choosing a business structure

Once you have a plan and are ready to register your company at the Chamber of Commerce, the first step (besides choosing a unique business name) is figuring out what business structure (rechtsvorm) is suitable for you and your company.

The linked tool can help you figure out what is appropriate for your business. This depends on if you are alone or together, your ambition, the business risk and profit. The most common ones are:

• Sole proprietor (eenmanszaak): “A Dutch eenmanszaak is a legal structure without legal personality. As sole trader you alone are responsible, and liable, for the company, its finances and its debts.”
• Commercial partnership (vof): “A commercial partnership is a company in which at least 2 persons work together under one common name. Every person who participates becomes a partner.”
• Private limited company (bv): “A private limited company, or in Dutch a besloten vennootschap (bv), is a business structure with legal personality. This means that the bv is generally speaking liable for any debts, rather than you as an individual.”

Especially when you start to do business with others (eg. contracting freelancers, doing contract work or applying for grants) it’s important that you are registered at the Chamber of Commerce.

Each business structure will come with its own cost, benefits and requirements. It’s highly advised to read up on each before registering to find out which one is most suited to you. If you are in doubt, you can get in touch with the Chamber of Commerce and they can help you on the way.

A sole proprietor and commercial partnership can be registered at the Chamber of Commerce by you (and possible partners) for €50, and a private limited company requires a civil-law notary. This generally costs between €400 – €800 (2020), and scales depending on the number of co-founders, holding structure and custom work.

Administration & Legal obligations

Each business structure also comes with its own requirements that you need to conform to by law. And regardless of structure or legal obligations, make sure your paperwork and administration are in order. This can be done through dedicated software or through (cloud saved) documents in folders. With a bv it’s legally required that an accountant checks your books before submitting it. A business bank account is recommended as it makes it easy to track your income and expenses, and in many cases required by your bank’s terms and conditions.

No matter whether you’re working with friends, family or partners, always put agreements on paper. You hope you never need them, but when disputes arise around ownership or money you’ll be happy that you agreed upon terms in the happier times. Furthermore, it ensures that you are aligned and thought everything through. For example when you are registering a bv you always have statutes (statuten) that describe the ground rules how your business operates, and more elaborate terms can be put in the shareholders agreement (aandeelhoudersovereenkomst). Similarly it’s important that you specify the IP rights so it’s clear who owns the intellectual property (eg. your game).

As with every business you need to keep an eye out on your cash flow so you know what money comes in and what goes out. It should never be a surprise when you’re about to run out of money, as you should have taken action months before that happens.

Hiring

Building games is often a team activity. For the first ‘employees’ you can start as co-founders to get things off the ground. Make sure you put the terms of your collaboration in writing with your co-founders (even if it’s a simple notepad document). Consider things like shares, vesting, salary (if any), roles and responsibilities, revenue sharing, and what happens if someone wants to quit.

When expanding the team you can hire contractors (have a contract ready and specify the work to be done), or hire personnel. The former makes you flexible in cost and team size, and the latter allows for long-term development of your team. Hiring personnel requires you to follow several obligations by Dutch law such as payroll tax, paying holiday allowance and providing healthy and safe work environments. Think about what’s right for you now and how it can impact your (financial) plans in the future.

Professional advice & services

If you feel like you could use some more help, know that professional help does not have to be expensive and is often worth the investment. It can cost you a lot more if there are issues later on. The most common ones when starting out:

• If you have general business inquiries you can contact the Chamber of Commerce (KvK) for free.
• For legal advice or work on legal documents, legal obligations or how to protect yourself and your business you can contact a legal advisor / law firm. Many can answer basic questions for free during an introductory meeting, and some work is highly standardized that it will not cost a lot until custom work is needed.
• Because every business structure has its own financial requirements and benefits it’s also advisable to seek out an accountant for advice and/or ongoing work for your business.

Check out the DGA Resources page for trusted partners, helpful resources, events and tips on navigating the Dutch games industry. We also have some business centers and incubators in The Netherlands, such as Dutch Game Garden, Game Bakery and Indietopia, that focus specifically on game company start-ups.

Official information from the Dutch government for entrepreneurs can be found on these websites: https://ondernemersplein.kvk.nl/ (NL), RVO (NL) and https://business.gov.nl/ (EN)

If this was helpful, please consider becoming a member of the Dutch Games Association to get additional resources and support. You will join a community of like minded entrepreneurs who want to see the Dutch game industry thrive. Join here!

Good luck!

Thanks to Maurice Kroes and the other contributors for creating this guide!