Potential Escape Room Owners: Your Napkin Math is Flawed

Repeat after me: Escape rooms are not a get-rich-quick-scheme.

There’s a cohort of individuals who have taken the plunge into escape room entrepreneurship without doing the research necessary to succeed in this business.

We’ve beaten quite a few of these points over the head many times in talks and posts, but there’s one thing that we didn’t delve into, that I think bears some thought: money.

Stylized image of US currency strewn about.

Escape room napkin math

There are an awful lot of potential escape room owners, players, and even journalists who run through this basic mathematical exercise and draw some painfully faulty conclusions about the escape room world:

How much money will an escape room make per year?

$30 per ticket * 8 players * 8 hours per day * 5 days per week * 52 weeks = $499,200 per room per year.

You can tinker with these ballparks, but the inherent assumption is that an individual escape room will pull in roughly half a million dollars per year.

If you open multiple rooms, that number multiplies.

Where can these calculations go wrong?

Weekends & perception

Most escape room players visit companies on weekends. As a general rule, if an escape company isn’t busy on the weekends, there’s a good chance that it’s suffering.

If you’ve only played a few games, the odds are pretty good that you’ve visited escape rooms on weekends and seen a bustling business that’s likely dead on a Wednesday afternoon.

Most escape room owners tell us that they make the overwhelming majority of their money from Friday through Sunday and on holidays.

Player count

In the early days of escape rooms, all of these games were crammed to capacity. Setting aside the fact that an escape room at capacity is usually a subpar experience… it’s also not so realistic. And the higher the capacity is, the lower the odds that the room will be full.

You can expect 3, 4, 5, or maybe 6 players per session.

Long opening cycles

If you’re a new company, it’s going to take you so much more time to open your doors than you’re expecting.

Designing and building games is a lot harder than it looks.

If you’re testing properly, that takes time… and so do the subsequent iterations.

Then there’s local code, zoning, and inspectors. Zoning boards and inspectors can make a complete mess of your life and add months (plural) to your timeline.

All of this time will pile up while you have an active lease and you’re bleeding money with no opportunity for revenue.

Slow seasons

Depending upon where you are operating, some regions have a lot of seasonal business. You might have nearly dead months. You never know.

Chaos

Like it or not, chaos is a factor.

Players will break things. Replacements will cost money. The worst case scenario is room closure.

There are also issues like flooding, fires, and all sorts of natural and unnatural disasters that could damage, halt, or flat out destroy your business. Fires have happened at least 3 times in North America alone.

That napkin math isn’t totally wrong

It’s important to know that some companies really do pull in a ton of money per room per year. Even still, it’s probably not half a million dollars. That number is incredibly optimistic.

Many of the escape room businesses that pull in lots of cash were early entrants who built up strong SEO, captured media attention, and picked up a lot of word-of-mouth awareness… all of which were easy to do when they were the only show in town.

There are new entrants into the business who succeed, but they have to work a lot harder, produce better products, and be a lot more cunning than the early companies were.

The early pioneers had their own problems to solve, but more recent businesses have a steep hill to climb to make inroads against the established companies.

Reset your expectations

Escape rooms don’t work like Field of Dreams. People might not come. They likely won’t come in the droves that your napkin math projected.

If you aren’t prepared to lose money in your first year of business, then you should consider another line of work. Maybe you’ll be cash flow positive, but if you aren’t prepared to be in the red, then you’re setting yourself up for failure.

Figure out how you’re going to get up and running and then how you’re going to fill your company from Friday night through Sunday.

In the mean time, ask yourself this…

What happens if you only sell enough tickets to fill up on weekends?

$30 per ticket * 4 players * 8 hours per day * 2.5 days per week * 52 weeks = $124,800 per room per year.

This might still be an optimistic number, but it’s going to be much closer to an accurate and achievable ballpark.

I’m not kidding that this might be optimistic. I am certain that there are escape room owners reading that calculation and wishing that they were actually sold out on weekends.

Do your math carefully and make sure that you’re financially able to weather a harsh start-up. There’s plenty of money in escape rooms and immersive entertainment, but don’t buy into the illusion that it’s easy money.

Why open an escape room?

Don’t get into escape rooms because you think that it will make you rich. It probably won’t, especially if your heart isn’t in the right place and you don’t have the skills or money to make it work.

Get into escape rooms because you love them. Because you want to design games. Because you want to bring fun and joy into people’s lives.

One thought on “Potential Escape Room Owners: Your Napkin Math is Flawed

  1. This was such a wonderful read David. The points mentioned by you are true and factually correct in every way. Breakage and replacements cost a lot, especially when kids are involved. Escape rooms thrive on creativity, one has to constantly upgrade the business and include new games to keep the customers rolling in. It is absolutely essential to bear these things in mind before planning an escape room business. One must also not forget that customer feedbacks are bad too sometimes, and can affect ticket sales, in some cases maybe even a refund.

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