Why is Granola like that?

I run a small videogame controller business, Granola Arcade, that I started in 2022. Over the years it has changed shape and size, and played different roles in my life. It’s currently firmly a “side project” taking up a couple hours of my time per week, and the occasional side quest to improve one aspect or another of it. At its peak, it was my full time occupation, processing up to 100 orders per week. Although it never grew to a point that I could feel comfortable relying on it, and new entrants into the market caused a significant decline in sales over time, I still consider the business to be a major success and one of the things I’m most proud of building in my life. I attribute that success mostly to the way I structured the business - because there was a lot of uncertainty going in, my primary goal was to remain flexible and manage risk. From the start, I was ready for Granola to scale to a full-time job, stay as a side project, or fail and disappear completely. I thought I’d write up a few of those decisions here.

Goal setting

I was very explicit about my goals going into the Granola project. It was very useful to have a rubric to evaluate future decisions against; when other people ask me for advice on starting a business, I always ask them what they want to achieve with it - how big they can imagine it growing and how small it could be and still be worthwhile. Defining what success and failure look like up front will pay all kinds of dividends later. Granola’s goals were:

1. Stay out of debt!

Plenty of people use debt to start a business but I chose early on to make sure Granola was profitable as soon as possible. I had purchased a 3D printer already, but I had to make sure that I could print enough cases that I wouldn’t immediately need to buy another one. There are some up-front costs to start any business (forming an LLC, getting a registered agent, etc,) but I knew I had to reduce any recurring costs to a minimum.

2. Make it scale cleanly from side gig to full time.

It was important to design my controllers to “make sense” to build a handful of them per week, or churn through a large quantity all at once. My per-unit cost should not change significantly and I should be able to handle spikes in order quantity that come with new games or big events, or marketing pushes.

3. Make it easy to update my products.

I’m not a trained designer, I’m not a pro-level gamer, and I have no idea what I’m doing. Honestly, I’m a “measure once cut twice” kind of guy. I want to choose materials and processes that let me iterate quickly, and correct mistakes as quickly as I can. I don’t enter long term contracts with manufacturers, and my choice of materials (3D printing, commodity keyboard parts, custom PCB makers) allows me to very quickly adjust my designs if I need to.

Marketing: What worked for me

Open Source

I make all of my controller designs freely available online. I do technically restrict you from selling my current “flagship” models commercially, but anyone is free to remix the design and take any learnings from it that they want. This is not a decision I made because of the morality of it (though it doesn’t hurt that it gives me pleasant feelings,) it’s something I did for marketing and functional reasons. I don’t think this is the right choice for every business, but I do think it’s the right one for mine. Granola exists in a broader ecosystem of open source designs - the firmwares I use, GP2040-CE and Haybox, are both open source, with strong communities working on them, and me being open source as well helps me tap into those resources when I need them. It’s also important to say that controllers are pretty simple to open up and understand; if someone really wanted to steal my IP they could do it easily and escape any legal consequences. There have already been some high-profile lawsuits between controller manufacturers and I do not think that pursuing litigation has won any credibility for those companies. I generally believe that if I have any “competitors” it isn’t my peers in the indie controller space, it’s the larger corprations like Sony and Microsoft that control my fate much more directly. I believe it is better for me to pool my resources with the other indie controller companies and g I generally believe that if I have any “competitors” it isn’t my peers in the indie controller space, it’s the larger corprations like Sony and Microsoft that control my fate much more directly. I believe it is better for me to pool my resources with the other indie controller companies and grow the pie together, rather than trying to fight over scraps.

Community connections

Keeping my designs open source and participating in that community helped me get the word out in the controller and maker space, but for gamers it was important to connect to the fighting game community (FGC) directly. I tried a number of different marketing tactics, from ad buys to attending events to social engagement. I learned over time that the less authentic you feel and look, the less value you get. This basically wrote off ad buys completely - advertising in general gave pretty terrible returns on investment, and I believe that’s because people see through it. What did work was engaging with influencers and sending free controllers to all sorts of people in the community, big and small. Sponsoring small events paid more dividends than big ones. I did occasionally pay creators directly to create content, but most of the time just sending a controller is sufficient to get people’s attention. The rewards here are pretty unpredictable - but with my margins, if I am able to sell just one or two controllers because of one I gave out for free, that was a good enough ROI to justify it.

Provide the best support

Face time with your customers is the only structural advantage a small maker has over a larger corporation. I have plenty of anecdotal evidence that providing good support led to more sales down the road, and even providing replacement parts for free with no strings attached hasn’t contributed more than 5% to my bottom line. While it can be annoying at times to answer the same questions over and over (it’s probably my least favorite part of the job overall) I recognize it’s incredibly important to my overall success. Providing good support is as much a marketing activity as anything else, and gives you an opportunity to learn more about your customers and the common issues they experience.

What about the products?

I want to spend time in future posts talking about my specific products and what I learned building them. I don’t discount that they had a lot to do with my success. But all of my designs were informed by my goals as a business and the ways I put myself out there into the world. If you start from that perspective, build goals and think about how you communicate, you will find you’re also able to build great products.