Chapter 48. Purple Games (1)

The number of young people enjoying games worldwide continues to grow, especially in emerging countries, where the growth is terrifying.

Not only China and India, but the game industry revenue in Southeast Asia and Africa has also increased explosively every year.

Therefore, global IT companies are fiercely competing for this massive market, and mergers and acquisitions are actively underway.

The most famous company in this field is Weichat.

Weichat, the largest company in China and the world's largest game company, has swallowed up game companies worldwide based on its massive Chinese market and formidable financial power.

A typical example is Riot Games.

This company, located in Santa Monica, USA, developed Tournament of Legend (TOL), also known as TOL.

Despite being released nearly 10 years ago, TOL is still the most popular game globally, with millions of players and over 200 million viewers for the annual esports tournament.

Although the headquarters and management are all American, 100% of the company's shares are owned by Weichat.

Nfl and Gubl are actively promoting game sales in the smartphone app market.

While games account for less than 10% of the app market, they generate over 80% of the revenue.

Additionally, Gubl, Nfl, and NS are all preparing cloud gaming services, aiming to stream games from the cloud to devices without downloads.

The game industry is growing rapidly, even now, as it did 10 years ago.

As seen in the success of Battle Island, the impact of a successful game is beyond imagination.

I nodded and said,

"That's why I'm on my way to invest in a game company."

The game I am about to invest in will achieve a success far greater than Battle Island.

* * *

StarGate Studio.

This company, located in Santa Monica, is a game company with 30 employees that primarily takes orders from large game companies rather than developing and releasing its own games.

Charles Griffin, Ken Atley, Steve Bostick, and Rufus Bailey, employees of this company, often played together after work.

They eventually decided to leave the company and create the game they wanted to make.

Each of the four contributed $50,000 to found Purple Games. They became co-CEOs, and each held 25% of the company's shares.

To save money, they worked in Charles' living room instead of renting a studio.

Game development was a difficult but enjoyable task. With their experience, development progressed quickly.

Unlike AAA games, which require significant capital and manpower and are hard to deviate from established formulas, indie games have the advantage of allowing developers to pursue their desired direction.

After a year of development, Purple Games released their first game, "Hammer Warrior," a 2D side-scrolling action game, priced at $9.99.

The game, released on Stream, recorded about 40,000 downloads, generating $450,000 in revenue.

Although it wasn't the huge success they had hoped for, they were satisfied.

The important thing was that over 40,000 people bought and enjoyed their game.

Buoyed by the success of their first game, they immediately started working on their second game.

Charles spoke about an idea he had been thinking about.

"What about a sandbox video game? Starting from a small village, you can freely enjoy using blocks without a set goal."

Sandbox games have the advantage of high freedom.

Moreover, since they don't require much attention to graphics, they can be developed at a low cost, making them a popular genre for indie game developers.

The famous Minecraft also started as an indie game.

However, it was later acquired by NS for $2 billion and is now the best-selling game in the world.

After Minecraft's incredible success, sandbox games flooded the market, but none could match its success.

Or even come close.

"I think it would be good to have multiplayer elements, inviting other users to the village you've created."

"It would be great if users could create mods to expand the game world."

"What about adding various activities like building, hunting, and fishing?"

As the development direction was set, ideas poured out. They named the game Block Valley.

The start was smooth.

Charles worked on the scenario and concept, Ken drew the designs, and Steve and Rufus implemented them through programming.

However, various problems began to arise during development.

Without a clear goal, it was easy to become boring, and the bugs in the physics engine and loading issues caused by the characters' various activities were problematic.

To prevent this, they had to limit the freedom, but doing so made it no different from a regular RPG.

The initial development period of one year passed quickly, and they were now in the third year. However, development had not progressed much and was still stuck in the same place.

Being able to go in any direction also meant it was easy to get lost.

Sometimes, they felt their game was the best and became proud, but the next day, they felt it was just a pile of data and became depressed.

The money they earned from "Hammer Warrior" had long been spent. They worked part-time during the day and continued development at night.

Steve tried to convince Charles to pause development and create "Hammer Warrior 2." With existing fans, they could at least make a living.

However, Charles opposed this. Despite intense discussions, their opinions did not converge, and Steve threw up his hands.

"I can't do it anymore. You guys can continue or stop as you wish."

Thus, Steve Bostick left the company.

With one of the four gone, development became even more difficult.

The remaining three were in a gloomy mood.

While they were deeply involved in development, the trends in the gaming industry were rapidly changing.

It was uncertain whether the gamers, who had become more discerning, would continue to enjoy their game. However, they couldn't give up now.

After three years of development, they had to see it through somehow.

"Maybe we bit off more than we could chew with our skills."

"We don't even have money for bread. What should we do?"

"Should we try to find an investor?"

"Would anyone invest in our game in this situation?"

"What about crowdfunding?"

Crowdfunding is a method of raising funds by publicly sharing a project in the development stage and receiving investments from anonymous individuals.

Recently, indie games have sometimes succeeded using this method.

Of course, there were far more failures. Tens of thousands of indie games are released each year worldwide.

Including those that were never completed or were not released due to lack of commercial value, the number would be even higher.

How many of these games successfully raised funds?

"Let's try it."

They wanted to see if their game had any commercial value.

Charles uploaded the game's trailer, development plan, concept, and design to Kickstarter, the largest crowdfunding site in the United States.

The fundraising period was three months.

The target amount was $500,000.

However, at this point, various incidents related to indie game crowdfunding were happening.

One indie game received $1 million in rewards before release but turned out to be a copy of another company's game. Another company that raised $650,000 disappeared without releasing a game.

Plagiarism, quality degradation, and embezzlement of development funds were chronic problems in the indie game industry, and the damage was passed on to other developers.

Not even $10,000 was raised in a month, and the funding was on the verge of automatic failure due to not reaching the minimum amount.

The three fell into despair.

"We need to get an investment."

"But we couldn't get one."

"We probably won't make it."

Charles regained his composure and said to his colleagues,

"Wait a minute. It's not over yet."

"Is there another way?"

"Let's try to find an investor."

"How?"

"We need to send emails."

Large game companies, console manufacturers, and ESDs have dedicated departments to support indie games, similar to how large corporations support promising startups.

Some indie game companies that received such support have achieved huge successes, leading to acquisitions by large game companies or becoming major game companies.

The most active company in such investments is Weichat, the largest IT company in China.

Therefore, they decided to first send an email to Weichat's indie game support department, but a message arrived.

[We were deeply impressed by your game on Kickstarter. I would like to meet you to discuss investment.]

"Who sent this email?"

"He's Korean and says he's coming here."

"Let's meet him. There's no harm in meeting."

Charles nodded.

"Right. After all, he's the first to recognize the potential of our game."

* * *

Charles and Ken met the sender of the email at a café near their studio. A young East Asian man and a blonde American appeared before them.

The East Asian man shook their hands and said,

"Hello. I am Han Miru, CEO of Continu Capital."

"Continu Capital?"

"Yes. We are a company that specializes in investments."

Charles and Ken looked at each other.

"Have you heard of it?"

"No. It's the first time I've heard of it."

Of course, it was. The company was only created a few days ago.

The American introduced himself.

"I am David Rockhart, a lawyer."

After the introductions, they ordered coffee and sat down.

Han Miru said with a smile,

"I have seen your game in development. I really wanted to meet the people behind it, and fortunately, I have the chance today."

Ken couldn't hold back and asked,

"Are you really going to invest in our game?"

"Yes. I plan to invest $1 million initially."

The two looked at each other.

It was twice the amount they had aimed to raise! With this, they could survive for two years.

"What are the conditions?"

Han Miru said as if he had been waiting for this question.

"I want 50% of the game's shares."

"50%?"

They all agreed to give up a certain percentage of shares in exchange for investment.

However, ...

'$1 million for 50% of the game means our game is valued at $2 million.'

They earned $450,000 from their previous game.

What about this one?

Charles had pride in the game they were making. He didn't want to give up his rights for a low price, no matter how desperate they were.

'$1 million for 50% is ridiculous.'