Season 4, Episode 12: The mobile gaming fundraising market (with Annina Salvén)
Nov 20, 2024
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In this conversation, Annina Salvén, COO of BIT ODD and former CFO at Next Games, shares her insights on the evolving mobile gaming landscape. She discusses the fundraising challenges faced by startups and the significance of a diverse investor base. Annina contrasts the mobile gaming scene from 2016 to today, highlighting new revenue opportunities and user acquisition strategies. They also explore Helsinki's emergence as a gaming hub and the changing dynamics of game publishing, emphasizing collaboration as key to success.
Annina Salvén's return to mobile gaming emphasizes the importance of strategic career choices and the impact of industry innovation on personal passion.
The evolution of funding in mobile gaming reflects tighter venture capital standards requiring startups to demonstrate traction and realistic valuations.
Helsinki's gaming ecosystem faces challenges with declining new startups, highlighting the need for a balance between established companies and emerging talent.
Deep dives
Transition to BitOdd and Career Journey
The guest discusses her career path leading up to her current role as COO of BitOdd, which began with her exit from Netflix. She reflects on taking a break from gaming and finance, allowing her the opportunity to consider her next steps critically. Engaging with the team at BitOdd reignited her passion for the gaming industry, particularly due to the innovative vision of the leadership. Her experience underscores the value of strategic career moves and the importance of timing in professional development.
Challenges in Nordic Gaming Startups
The conversation highlights the historical context of Nordic gaming startups, particularly the challenges of gaining venture capital in the early 2010s. Noting the evolvement from skepticism about raising large sums to a period of robust growth, the guest discusses how industry sentiment has shifted. This narrative reveals a cycle where early venture funding was scarce, making later successes like IPOs more impactful. Consequently, the capital landscape has transformed in ways that require new gaming ventures to adapt to more rigorous funding metrics.
The Need for Talent Development in Gaming
A critical insight shared is the lack of diversity in experience within the gaming talent pool over the past years. The guest emphasizes that an over-reliance on senior professionals produced a stagnation of young talent entering the industry, leading to an imbalance. This resulted in fewer innovative game creators capable of pushing boundaries within gaming development. Thus, the need to foster an environment that blends experienced and emerging talent becomes paramount for the industry's future success.
Investment Trends and Valuation Issues
The discussion shifts to current trends in mobile gaming investments, noting a significant shift in how venture capitalists assess and fund gaming startups. The guest notes that the standards for funding have tightened, as VCs now require demonstrated traction and realistic valuations before committing to investments. This significantly alters the landscape for emerging companies that previously relied on inflated valuations without metrics to support them. As a result, the conversation illustrates a crucial period of adaptation for studios striving to secure funding in a more prudent marketplace.
The Evolution of Helsinki as a Tech Hub
The guest reflects on the evolution of Helsinki as a gaming and tech hub, noting both achievements and concerns in the industry. While Helsinki boasts a concentration of major gaming companies and the talent they attract, there is concern about the decline in new startups emerging in the ecosystem. This sentiment is coupled with the understanding that without fresh, innovative ventures, even well-established companies might reconsider their presence in the city. Ultimately, fostering a thriving ecosystem that balances established players with new entrants is crucial for maintaining Helsinki's standing in the global gaming landscape.
My guest on this week's episode of the podcast is Annina Salvén, the COO of BIT ODD, a Helsinki-based gaming studio that was recently profiled by the WSJ. Bit Odd raised $18MM in a seed extension this month, following on from the €5MM seed round it raised in 2022. My fund, Heracles Capital, is an investor in both rounds.
I asked Annina to join me on the podcast to discuss the current state of venture fundraising for mobile gaming. Specifically, we cover:
Why Anniina returned to mobile gaming, given the challenges;
How the 2016-era of mobile gaming compares to today;
The distribution challenges now relative to 2016-2018;
The opportunities in mobile gaming now from a revenue growth perspective;
How mobile gaming start-ups should think about exit opportunities;
The process for BIT ODD in raising its Seed extension;
What mobile gaming start-ups should look for in an investor;
The cross-platform gaming opportunity;
Whether games publishing is still viable;
Helsinki's evolution as a mobile games development hub.
Thanks to the sponsors of this week’s episode of the Mobile Dev Memo podcast:
Vibe. Vibe is the leading Streaming TV ad platform for small and medium-sized businesses looking for actionable advertising campaign performance.
Clarisights. Marketing analytics that makes it easy to get answers, iterate fast, and show the impact of your work. Go to clarisights.com/demo to try it out for free.
INCRMNTAL. True attribution measures incrementality, always on.
Interested in sponsoring the Mobile Dev Memo podcast? Contact Marketecture.
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