Reinout, the podcast host, is a games investor and strategic business consultant specializing in the games industry. Each week Reinout releases two new episodes of his games podcast show to his gaming industry audience from all over the world.
The games podcast currently has over 24 episodes, providing you with expert knowledge and the latest and greatest information in the world of gaming. This includes interviews with a highly-talented network of gaming professionals, sourced from years in the industry to share their experience and insights on all things gaming.
Here you can read the transcript of today’s episode.
Episode 4, Click on Play here under and listen; https://podcastgameconsultant.com/episodes-games-podcast/
Also some feedback from several gaming people about fundraising and marketing. And I share with you some companies that I find interesting to keep an eye on.
Lets start, and you know, if you have feedback, questions, scoops and more, mail me at firstname.lastname@example.org, and I wouldn’t mind if you would share this gaming podcast with friends and collegues.
Before starting with the regular items, I wanted to address GDC 2020, Monday til Friday, March 16ht and ending March 20th in San Francisco. I reached out to Rafael and Brian from Informa with the question “Is the corona virus going to be an issue or not”. Their answer was; “GDC is planned to take place as scheduled in San Francisco, CA. We are actively monitoring the novel coronavirus (2019-nCoV) outbreak and are complying with the guidelines set by the local government, the Center for Disease Control and the World Health Organization (WHO). We encourage you to visit the following sites for additional information:
The safety of attendees and sponsors is our priority and we will continue to provide updates, as needed, leading up to the event.”
Mobile Gaming revenues are growing. According to Sensor Tower worldwide consumer spending in games grew around 13% across all stores, from $55 billion in 2018 to $62 billion in 2019. I needed to know more about this are did also ask Craig from Sensor Tower what to expect in 2020 and if he could share with us some other highlights. Unfortunately no answer, which is a shame.
His comments were; In the next one to two years, mobile gaming will be the fastest growing gaming segment. We expect most growth in the mobile gaming market to come from emerging markets, primarily South East Asia, India, and the Middle East. The mobile gaming markets in East Asia (China, Japan, South Korea), the US, and most of Europe will grow but not quite as fast as it has during the latter half of the past decade. Console gaming will pick back up when the next generation of consoles launch, but it’ll take at least another year before people spend the majority of their budget on game software. Therefore, mobile is once again the market to watch in the coming two years.
Little advice for the game developers out-there?
There’s plenty of opportunity in unexplored genres on mobile still. But creativity isn’t limited to genre. Through art style, theme, game mechanics, play modes, and many other elements, a game can be unique and be a hit.
It’s also important to realize that mobile gaming is not such a different thing from PC and console gaming. At least, not as different as we used to say. We’re seeing a lot of mechanics that work in core and mid-core games translated into mobile experiences and those can be quite successful.
Aside from what I described above, some stray observations for the year are:
Rise and fall of misleading advertising in playable ads: one of the most surprising trends of 2019 was playable ads for mobile games that marketed a game through a mechanic that was hardly or not at all used in the games being marketed. Even more surprisingly, it turned out that the marketing strategy worked. After installing the game and finding the core gameplay loop was completely different than the playable ad, a lot of players might quit, but a large part of these people stuck around. There are signs that this was a temporary trend as players are becoming aware of the tactic
I did a quick mail out with questions concerning marketing and their 2020 focus to some people. First one is Mike of Rogue Games. Challenge for 2020 in marketing? Getting a return on advertising spend (ROAS) and driving down CPI’s.
He said, when we first automated bid and budget management for Facebook, and have since expanded our automation, based on our tests, we’ve adapted our tool to Facebook’s current requirements and continue to see significantly better profits than prior to applying automation.
Another topic of particular interest to Phoenix Games is how to use ad monetization performance data for UA targeting. They have to play catch-up in this area because historically their games have been super strong on the IAP side and somewhat neglected ad monetization, but that has been changing now.
Interesting. So since I had Oliver’s, CMO of Lockwood, attention anyways as a company on my watchlist, his thoughts on marketing; Focus on creative and build highly automated systems that manage the bids and budgets and don’t become a drug-addict of user acquisition.
As for the challenges, he is seeing that hypercasual is stealing the impressions and that google and facebook black-boxes make it hard to optimize for long-term value. His focus will be on new channels that own media like Tiktok and more sustainable growth tactics.
Funding & acquisitions
Besides the news that Kolibri Games sold a majority stake to Ubisoft. I asked some interesting people their feedback on funding, pitchdecks and their focus for this year.
Daniel from Kolbiri Games gave me a quote I can use „Daniel said in a private conversation that Ubisoft is the best partner they could have hoped for”. May I, from this spot, say to Daniel and his team; big congrats and well deserved!
They have agreed with the people over at Ubisoft not to share anything neither do interviews…for now. So keep you posted if more information is being released.
A very interesting player in the field of M&A is Stillfront. I did ask Marina, head of M&A of Stillfront some questions like what their focus is, investment criteria and such. I did reveive great feedback. Their top priority is investing in evergreens, combined with building size and portfolio. A perfect example is their recent acquisition of Storm8, a great strategic fit as she described. Adding directly; we have a healty pipeline.
Stillfront is looking for stable, well managed small and medium sized gaming studios with LTM revenues (last 12 months) of 5-10 million dollars and a minimum ebit of 20%. Obvisiously cultural fit, motivated teams and proven experience in developing successful games. Thank you Marina for sharing this with me.
- More early stage funding for gaming and eSports: new funds (Griffin Gaming, Artist Capital, 1Up Ventures, Bitkraft, etc.). Some funds had first close and expecting second close soon.
- More Private Equity company deals: Blackstone has been fairly active (Murka, Vungle). Several of the other top PE firms want to do a gaming / eSports deal this year.
- Limited interest from China (besides Tencent and Netease)
- New digital media funds from some strategics (e.g. Vivendi)
Gaming Companies on my watchlist
These are not companies because of high revenues or high profile. I watch these companies because they are doing something smart or interesting. Every week I will mention a few of them.
First one is GameRefinery;
- I did mail Markus, CEO of GameRefinery, some questions. He was very helpful.
- Their mission is to be the leading mobile game market data provider with intelligence that explains why and how games succeed. They are doing this by delving into the very building blocks of mobile games, for example their features. This way you can understand the drivers behind the success of these games. This year they will be expanding their data offering to cover even deeper and wider dataset.
- The company was founded 5 years ago has 25 people. Headquarters based in Helsinki and people on the ground in London, Berlin and San Francisco. Soon there will be an Asian office too.
- Company is profitable and 2020 is expected to their biggest growth in their history.
- Furtheron he mentioned that scaling is important without messing things up but through having global presence his aim is to a globaly recognized must-have tool in the industry.
Second company is LockWood;
- Contacted their CMO, Oliver Kern. He did share some interesting details about the company.
- Lockwood Pubishing is the developer and publisher of Avakin Life.
- Avakin Life is a 3D Virtual World. An ever-changing universe of new people, places and experiences. You can create an avatar as unique as you are.
Then chat with the millions of people just like you, who hang out there every day.
- The company exists for about 8 years and initially created content for Sony’s Playstation home.
- More than 130 employees with offices in Nottingham, Newcastle, Lisbon and Vilnius.
- Interesting investors. Two worthwile mentioning; Hilmar Veigar Pétursson (CEO CCP), David Helgasson (Unity Founder)
- Ad revenues and non IAP revenues are about 40% of their total revenues. AppAnnie indicates IAP should be between 2.5 and 3M USD per month in gross revenues
- Challenges, he described, are integrating the new hires.
- Opportunities? too many he laughed, for example further distribution in the MENA and APAC regions and further development on monetization and user generated content
The third and last company on for today is Good World Games;
Founded by Gregory and Derrick, located in Miami, and an office in NY, employs 7 people, and publishes the platform GameTrove, which is a hyper casual platform, which includes hundreds of instant play HTML5 games, for the Traveling Gamer. They launched their platform less than two years ago and experienced rapid growth over the past 12 months with revenue having tripled.
They partner with bus, rail and airliners, as well as hospitality operators around the world to distribute their platform.
GameTrove is a subscription service through carrier billing. A nice detail is that they are live with top travel operators such as Greyhound busses, Eurostar, Virgin Trains, just to name a few.
How you ask? The operators embed GameTrove in their very own onboard infotainment systems for easy access by passengers on their personal devices. Mobile operators like T Mobile, Vodafone and others also partner with GameTrove.
The forecast of 2020 is looking bright, YoY significant revenue increase.
Opportunities for 2020 include additional distribution partnerships in Africa and North America with major travel operators. Challenges for 2020 include accelerating the pace of deployments following a sign distribution deal.
If you want to know more about these people and their company, you can find the transcript of this episode on my site with the links that will bring you to these gamings finest!
I think we covered it all. I do hope this was useful and informative for you. Love to get your feedback and input on topics that I should cover in the following episodes.
Until then, thank you for listening!