I personally know plenty of indie game successes so it's definitely doable.
Generally:
* Keep things small and focused.
* Make games, not game engines.
* Keep control of your revenue streams early on. Sell the game yourself and consider platforms such as Steam or XBLA bonuses. If you can't sustain yourself without those platforms you probably won't make it. Use that extra revenue for expansion of your studio or your ambition.
* Marketing and PR should be a primary focus, alongside game development.
* Scope scope scope. If you're first product is an MMO you'll fail. If you think your first few products will be able to compete with anything on a store shelf you'll fail. A good game with personality is not dependent on your underlying tech nor does it require novels of content. That's why many of the successful indies start with 2D games drenched with style. A good game is a good game.
Generally:
* Keep things small and focused.
* Make games, not game engines.
* Keep control of your revenue streams early on. Sell the game yourself and consider platforms such as Steam or XBLA bonuses. If you can't sustain yourself without those platforms you probably won't make it. Use that extra revenue for expansion of your studio or your ambition.
* Marketing and PR should be a primary focus, alongside game development.
* Scope scope scope. If you're first product is an MMO you'll fail. If you think your first few products will be able to compete with anything on a store shelf you'll fail. A good game with personality is not dependent on your underlying tech nor does it require novels of content. That's why many of the successful indies start with 2D games drenched with style. A good game is a good game.