Technorati.com | The four things startups need, to be sexy enough for an IPO
The San Francisco Bay Area (including Silicon Valley) is a hotbed for tech startups, particularly in mobile gaming. There are many mobile gaming success stories that started here, including Zynga, Glu Mobile, PlayFirst, and many others. And while tech insiders always seem to be looking for the next big thing, having nothing more than a killer app doesn’t necessarily position a startup to break out to the next level. As an example, our company Game Insight was founded in 2010 to break into the casual gaming market, which was, at the time, a brave new frontier. In 2014, our company has more than 250 million users worldwide, and not a single “killer app” got us there.
1. KNOWING YOUR NICHE
First, to position your startup to become a world-class contender, you need to be in the business of building products for which there are actual markets. It sounds obvious, but it’s also surprisingly, and heartbreakingly, common to see passionate entrepreneurs invest their time, money, and selves into projects that ultimately don’t have enough consumer appeal to support their startup’s long-term growth. It’s crucial to have your finger on the pulse of the market, and on your customers (and competitors’ customers). For mobile game companies, this means keeping up with what mobile game players are playing, and how they’re playing.
As we’ve seen, overall mobile game engagement greatly increased in 2012 to 2013, from an average session time of about one-and-a-half minutes to more than two-and-a-half minutes, and that the number of users who will play a game for longer than 10 minutes more than tripled, according to a Forbes report sourcing NativeX data. This ties directly into the trend we’ve observed of mobile game players looking for more in-depth, high-quality gaming experiences, which is why we are now developing more “core” game titles to support this growing audience of highly engaged game players.
2. SIGNIFICANT INNOVATION
Another key aspect of positioning your startup for success is innovation. Looking at the mobile apps space in general and the mobile gaming space in specific, competition is absolutely fierce. In 2007, Apple’s iPhone changed everything. The new, “wide-open” market for games, lowered costs and barriers, and fueled third-party titles. The App Store created the very first direct connection between developers and consumers that bypassed hardware providers and game publishers.
There are still bizarre new games like Flappy Bird that can come from out of nowhere and become big success stories overnight, but by and large, the mobile gaming space is becoming dominated by major players who have mastered one genre of game or another. Breaking out from the pack requires out-of-the-box thinking at all levels.
If your startup can successfully reinvent the wheel, this can be a great thing—however, you might do just as well by building a better mousetrap, creatively solving the problems that customers experience with current products to create a better, if iterative, product. Many game companies are looking to break out of the ruts of common game genres and common business models with real alternatives for an increasingly discerning audience.
3. YOUR GLOBAL READINESS
A third factor that will help your startup shine will be positioning yourself for strong international growth. In order to succeed in international markets, it’s important to know your audiences culturally and create custom-tailored content for their tastes. In terms of mobile, it’s also crucial to understand the infrastructure of any international market you’re trying to enter: which platforms, which operating systems, and which points of entry are available to you—whether that be working carriers to integrate your apps into their local application stores, or directly with hardware manufacturers such as Apple and Google.
A great example of building international partnerships would be Game Insight partnership with popular messenger app KakaoTalk (located in South Korea). KakaoTalk is the first mobile messenger to open its platforms to mobile games, monopolizing on the strong user base. Additionally examples of building international partnerships would be for gaming companies to partner and have their games pre-installed on new mobile devices or via local app stores.
4. HAVING REAL TALENT
The final factor in ensuring your startup’s success will be its talent. Yes, this is another obvious point, but it also bears repeating. It’s crucial to have leadership with a clear vision and strategy for where your company is headed, not simply next week or next month, but next year, and for the next several years. Working in mobile, it’s also obviously important to have great technical talent in the form of skilled coders and engineers who can support your technical vision. Of course, we’re all familiar with the race for talent, particularly in the Silicon Valley. Top engineering talent is this part of the world in short supply and carries an exorbitantly high premium! That said, top tech talent doesn’t reside solely in the Bay Area. There are numerous new markets where mobile and tech are booming, and brilliant new talent being discovered each day.
At Game Insight we have a San Francisco office, but are headquartered in Moscow. As you can imagine, we have an extensive network throughout Russia—which just happens to be one of the hottest new markets in the world for mobile. However, we haven’t been content to simply network with our nearest neighbors, and instead have recruited talent throughout Eastern Europe, and actually own and operate numerous remote development studios in these territories. Top talent can definitely be difficult to find in saturated markets... this is why it may not necessarily be a bad idea to conduct your search in new places. But wherever you go, it will always be important to create a strong corporate culture that will breed enough loyalty to hang on to your best talent once your competitors get wind of them.
By positioning your startup for success, you can get to that next level and finally start mulling over exciting decisions, like whether to accept a buyout offer, or consider holding out for a public offering. But that’s a topic for another day.