How to start your own successful Escape Room Company for only $7,000

In August of 2013, Dr. Lindsay Morse and I co-founded Puzzle Break, the first American-based Escape Room company. We opened our first room in Seattle with an out-of-pocket investment of just $7,000 and it’s not unreasonable to conclude that we changed the world for next to no money. Our story has become something of a legend. From a public relations and vanity perspective, I couldn’t be happier with our story being told again and again. Unfortunately, there’s context to our journey that is often lost in the telling and I’d like to take a moment to reach out to the folks thinking about starting an escape room after hearing about Puzzle Break.

In July of 2015, Marketwatch published a historic article on the explosive growth of escape rooms. The author and its sources (including yours truly) offered some breathtaking stories and figures of outrageous growth with minimal investment.

“Nate Martin…invested $7,000 of his own money in 2013 to get the business off the ground. He recouped his initial investment within a month. Since then, the business has been profitable every month and, conservatively, is on track to gross over $600,000 in 2015. ‘Some months are record-breakingly fantastic,’ he says. ‘Some are only very good.’”

Pictured: Many folks' perception of Escape Room entrepreneurship.

Pictured: Many folks' perception of Escape Room entrepreneurship.

It's a very exciting article the importance of which cannot be overstated. Dozens, perhaps hundreds, of escape room operations began with future entrepreneurs reading about the get-rich-quick-and-easy stories outlined in the Marketwatch piece.

Regretfully, many of the folks entranced by this and similar articles failed to fully comprehend exactly how different the escape room landscapes were when we started Puzzle Break in 2013, when this article was written in 2015, and what things look like today.

I’ve written comprehensive annual updates on the history of Puzzle Break. I cover a multitude of topics ranging from general entrepreneurship to nuance game design elements and everything in between.

From my second year update, I explicitly addressed the gold rush I had inadvertently helped create:

“In many ways, the gravy train is already over. I touched on this in my reddit post last year, and went into a bit more detail in an interview with Market Watch July this year. In late 2013-early 2014, it was the wild west. Anyone with $10,000 could open the first escape room in their city (in the US, where we have been shockingly late adopters on this) and bask in the glow of buckets of free press & hordes of first-time players. The landscape today is very different. Most cities have several escape rooms. There's still enormous room for growth in the industry, but the increased competition has A. dramatically increased the barrier to entry and B. stripped away some of the extreme novelty. The local paper of record isn't beating down the door of the 6th escape room to write an article.”

Pictured: Those same folks if they open an escape room without ample market research.

Pictured: Those same folks if they open an escape room without ample market research.

I wrote this in September 2015. It was true then, and the situation today is even more severe. Saturation is here in many American markets. There’s an arms race to create the biggest, baddest escape rooms around and its progressing at a break-neck pace. Individual Puzzle Break rooms can now cost upwards of $100,000 to create. Consumers are becoming educated and sophisticated, and they no longer automatically respond favorably to bargain-basement or poorly designed offerings. There are absolutely still opportunities in the escape room industry in America, but they must be carefully chosen, strategically planned, and skillfully executed. And it’s (almost certainly) going to cost a lot more than $7,000.

Related reading: The Biggest Myths in Escape Room Competition.

So, how can you start your own escape room company for only $7,000? Easy: hop into a time machine to 2014 or before!

-Nate

Called the "Founding Father of Escape Rooms," Nate Martin is the Co-Founder and CEO of Puzzle Break, the first American escape room company. Puzzle Break is headquartered in Seattle with locations in Long Island, Massachusetts and on Royal Caribbean ships. Prior to Puzzle Break, he was a senior executive at Microsoft and Electronic Arts. He has shipped software used by billions of users as well as some of the most beloved video games of a generation. @GuyFromTomorrow on Twitter.

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