The F2P value chain is ripe for fragmentation and the emergence of specialist funding, says Tenshi

We have the data and the opportunity

The F2P value chain is ripe for fragmentation and the emergence of specialist funding, says Tenshi

As part of a day-long user acquisition workshop, which was put together by Fiksu and Tenshi Consulting, a panel talk about funding and publishing options demonstrated the fast-changing market conditions.

"Publishing funding is now very rare," pointed out Gareth Edmonson, CEO of publisher Thumbstar Games.

"There are so many good games out there. It's not needed."

Broadening the conversation, Ian Baverstock of Tenshi Ventures said that developers need to think carefully about whether they want a successful game or a successful company.

"What do you actually want the money for?" he questioned. "You need to structure your company accordingly."

Money for something

Looking for alternative funding models, Edmonson said Thumbstar was now working with some small film financing companies to see if the model also worked for mobile game development.

Tax breaks are another option, although in the UK, the promised tax breaks for games haven't yet materialised and other government funding is more focused towards technical innovation than creative innovation.

Of course, once you have developed your game, there are plenty of options in terms of publishing.

Paul Flanagan of Estonian developer Creative Mobile said the success of its Drag Racing game meant the company was branching out into publishing.

"We have a volume network. Drag Racing has 1 million DAUs, which means we have a good way of testing whether it's worth doing a publishing deal with a developer," he said.

However, Ian Baverstock warned developers that the days of them just handing over their game to publishers was over.

"There are publishers who will take your product to market, but as a developers you need to know how to launch a game," he stated.

"Even if you're not successful, you need to know how to launch a game - the decision making etc. If you let the publisher do it all for you, you might have a failure and no knowledge why.

"You have to be in the rinse-and-repeat loop. Developers can't stop at development. You need to find a partner who will let you see what's going on."

Fragmented value chain

Indeed, combining the funding and development process, Baverstock predicted that the market would soon expand to provide opportunities for specialist funding entities.

"Throughout the development and deployment cycle, there are different risk and reward opportunities," he said.

"As the business develops, I think you'll see different specialists come into the market, just as happens in the film industry. But there will be more sophistication as we have more data in the F2P games industry.

"I think you could end up in a situation when one company will fund your launch UA campaign and another will fund the late stage. Then you just have to fund the high risk creative development work."

Which brings us back to the beginning...

Contributing Editor

A Pocket Gamer co-founder, Jon is Contributing Editor at which means he acts like a slightly confused uncle who's forgotten where he's left his glasses. As well as letters and cameras, he likes imaginary numbers and legumes.