Most gaming studios fail because they run out of cash while making a successful one. Believe it or not, money is VERY important in making a game hit.
Yash Gandhi, an expert on finance and treasury, shares how studios can manage their money to extend runway and make smarter financial decisions.
Building a Great Game Isn’t Enough. You Need to Stay Alive Long Enough.
Ask most founders what keeps them awake at night and you’ll probably hear the same answer: cash.
Studios spend months, sometimes years, building games before meaningful revenue starts coming in. Even once a game gains traction, money doesn’t arrive instantly. User acquisition costs are paid upfront, while returns from those cohorts often take two to three months to flow back.
That timing mismatch quietly creates one of the biggest financial challenges in gaming.
According to Yash Gandhi from Felicity Games, treasury management isn’t about magically fixing this problem. It’s about making sure every rupee is working while you wait.
“Cash goes out now. It comes back later. Treasury management can’t eliminate that gap, but it can soften the pain.”
Instead of letting idle cash sit in bank accounts doing nothing, studios can generate safe returns that partially offset the natural delay between spending and earning.
The Gaming Cash Flow Problem Most Founders Underestimate
Unlike many software businesses, gaming companies spend aggressively before they know whether players will stick around.
For successful user acquisition campaigns, payback commonly takes 60 to 90 days.
That means founders constantly live inside a working capital gap.
Treasury management makes this waiting period less painful by ensuring idle cash continues earning until it’s needed again.
“Treasury management won’t solve a studio’s cash flow problem. Good games and good monetization do that. But it’s a low-risk lever that every disciplined studio should use.”
Review Different Numbers at Different Speeds
Many studios review finances once every month because that’s what accounting requires.
Yash believes that’s too slow.
Different numbers change at different speeds, so they deserve different review cadences.
User acquisition spend
- Review every week
- CPIs and ad auctions change constantly
- One bad week can quietly burn a large amount of cash
Cash position and runway
- Review every two weeks
- Frequent enough to catch burn-rate changes
- Infrequent enough to avoid unnecessary noise
Strategic financial review
- Monthly
- Hiring decisions
- Fundraising
- Product roadmap changes
“The faster a number can change, the more often you should look at it.”
When Runway Starts Shrinking, Every Team Has a Job
Many founders think shrinking the runway is purely a finance problem. Yash disagrees. He sees it as a company-wide response where every department adjusts simultaneously.
Growth should stop gambling
Pause experimental acquisition campaigns immediately. Redirect spending toward channels and player cohorts that already have proven payback.
Growth shouldn’t stop.
Guesswork should.
Product should focus on retention
Acquiring new players becomes more expensive when cash is tight. Keeping existing players engaged becomes significantly cheaper.
Quick live events, retention improvements, and engagement updates can extend player lifetime without requiring massive acquisition budgets.
“A retained user is cheaper than a newly acquired one.”
Finance should make idle cash productive
Finance teams should identify:
- cash needed for salaries
- upcoming vendor payments
- tax obligations
- genuinely idle funds
Only after understanding that picture should they decide where surplus cash can safely earn additional returns.
Founders should begin fundraising early
One of Yash’s strongest recommendations is surprisingly simple. Don’t wait until panic sets in. Start fundraising conversations while the company still has options.
“Raise from a position of ‘we corrected early,’ not from a position of panic.”
The Warning Signs Come Earlier Than Most Founders Think
Financial crises rarely appear overnight. The warning signs usually show up months earlier.
Yash recommends paying close attention when there are roughly six to eight months of runway remaining, based on the average monthly burn over the last three months.
That isn’t an emergency. It’s the moment to begin making adjustments.
Waiting until only a few months remain dramatically reduces the number of good options available.
Before Cutting Costs, Build a Clear Picture
Many companies respond to pressure by immediately freezing hiring or cutting marketing.
Yash recommends slowing down first.
Start with measurement.
Map every expected payment and incoming receivable across the next two to three weeks for a clear understanding of cash position.
Only after building that picture should leadership model different spending scenarios across every department.
For example:
- What happens if UA spending drops by 10%?
- What changes if product investment drops by 20%?
- Which cuts meaningfully extend the runway?
- Which cuts simply damage growth?
“You can’t fix what you haven’t measured.”
Three Treasury Mistakes Young Studios Make
After working with gaming businesses, Yash sees the same mistakes repeated again and again.
1. Parking money in ordinary bank fixed deposits
Traditional bank FDs often provide lower returns while locking money away longer than necessary.
Safer alternatives like liquid funds, treasury bills or well-managed corporate instruments can offer better flexibility.
2. Managing treasury informally
Many studios leave investment decisions to whoever handles finance internally.
Without structured treasury planning, cash often sits in inefficient instruments that don’t match payroll schedules or expected burn.
3. Holding excessive emergency cash
Founders often keep much more money idle than necessary because they don’t clearly understand upcoming receivables and payables.
Better forecasting allows surplus cash to earn returns without putting operations at risk.
“Studios often over-hoard cash ‘just in case’ because they don’t fully understand their payment timelines.”
When Money Gets Tight, Cut the Right Things First
Cost reduction shouldn’t be random. Yash recommends ranking expenses by how close they are to proven revenue.
Cut in this order:
- Experimental user acquisition
- Non-essential software and vendor contracts
- Travel and discretionary spending
- Headcount as the final option
This approach protects the systems that actually generate revenue while helping preserve team morale.
“Cut waste before you cut people.”
One Weekly Habit Every Gaming Studio Should Start Today
If Yash could recommend just one financial habit for every studio, it would be surprisingly simple. Every week, create an eight-week rolling cash forecast.
Track:
- Expected receivables
- Salaries
- Vendor payments
- Software costs
- Taxes
- Other planned expenses
Updating this spreadsheet takes around twenty minutes. The visibility it creates is worth far more.
“A simple spreadsheet updated every week is the foundation for every other treasury discipline.”
Ending it…
Great games don’t fail only because of weak gameplay. Sometimes they simply run out of time.
Treasury management won’t replace strong retention, profitable user acquisition, or a great product. But it gives studios more breathing room while those systems mature.
For founders, that extra runway can be the difference between shutting down early and finding the next breakout hit.
About the expert
Yash Gandhi
Financial Controller, Felicity Games
Yash Gandhi is a finance and treasury professional at Felicity Games, where he works closely with gaming studios on cash flow planning, treasury management, and financial strategy.
His experience spans fundraising, working capital management, and helping teams make smarter financial decisions without slowing growth. Yash believes disciplined cash management gives studios the runway they need to build better games and scale sustainably.
