2 steps publishing, an alternative way to raise funds

It could work assuming you have the skills to make the necessary sales and you adjust the plan. You are going to have to account for many other expenses than just getting the game made. A website, advertising, shipping materials, licenses, etc.. This and you won't sell every copy. You'll need to send out a few review copies and then there is always shrinkage.

Another down side is you have not included any salary for yourself. If you self publish you will be working many hours to get the game sold.

Sounds similar to our business model thinking when we started. Didn't work out too well for us til we started listening to other people's ideas. I thought everyone would buy games made out of wood. A fellow gamer suggested that we make piecepacks. Sold more piecepacks the first month than all five of our other titles combined. The other titles are long gone, but sales of piecepack continue years later. Good advice. The same person was one of the people who suggested we should start making dice towers. And that's when the business really started to take off - in fact I would venture to say that hobby gamers are still more likely to recognize our dice towers than any of our game titles.

The important thing about the business model you end up with is that you like doing what you do, whatever part that is. Some people can do it all - design, artwork, sell it, make it, demo it endlessly at conventions. Others are good at one or two of these things. There are much better salesmen than me, so I found one and now he reps us. He gets us places we wouldn't be able to get in otherwise with our products, points us to opportunities that we wouldn't find out about - he also advises on what will sell and what won't. In other words, he likes to do everything that I'm not particularly good at. For his services he gets part of every sale. Since many of those sales were sales I would not have made otherwise, I find it a very reasonable arrangement.

Also, we do alot of work with self-publishers. Sometimes it's making a few hundred games, other times its POD-based and even being the their sales and fulfillment arm to the trade and direct to the customer. Depends on the publisher's choice. This is a corollary to the "listen to other people, they're smarter than you" theory. Almost all of this now robust line of business comes from referrals from people we've done work for before. This seems to work well, people design games but don't want to mfr them, or go overseas where minimum order is 2k, 3k 5k, but we will do small quantities or even one at a time POD. Customers get what they like, we do what we like. Sounds simple, but it took a few years to figure out...

So figure out which parts you want to do yourself, then get some good advice from others who like to do what you don't do too well - and then I think you'll like the results better.