Mojiworks and Messaging Games
I’m very excited to finally be able to announce our investment in Mojiworks. Balderton has had the excellent fortune to work with some great games companies in the past — Natural Motion (acquired by Zynga), Big Fish Games (acquired by Churchill Downs) and Wooga (still going strong!) — but it has been a long time since we made an investment in the sector.
The reason for the long gap in our investment in this area is driven by our thesis that category-defining games companies emerge and succeed when new platforms for gaming disrupt the market creating moments of opportunity. We’ve been waiting for such a disruption for a while and my partner Rob’s post explains more about our thesis and why we believe the huge growth in platforms such as Facebook Messenger, Apple iMessage and Whatsapp, represents one of these moments of opportunity. The time is right.
But beyond spotting and believing in a new platform, a key challenge in investing in games companies actually comes with the successes. As Rob outlines in his post, a successful new games company quickly generates significant revenue, and so unlike consumers and business software companies they do not always require continual venture investments. As a result, when investing in this sector we have to invest early and follow one of venture capital’s classic cliches and ‘invest in the team’.
In the case of our latest investment, the process of selecting which team to back was particularly tough.There are only a few companies pursuing messaging games, but they all have strong teams with track records of success. But, once we spent time with Matthew and Al at Mojiworks, we knew we had to work with them. Matthew has started three companies before, including co-founding Wonderland Software which was sold to mobile group Zynga in 2011.
Matthew stayed with the business and ran all of Zynga Mobile in the UK, driving that team and its growth through Zynga’s IPO.
Al, who has been Matthew’s closest friend since their schooldays, has also been his long time partner in crime, and was a co-founder and chief technical officer of Wonderland. A big part of what drew us to Mojiworks was that this was the band getting back together. Between the two of them, the guys have worked in senior roles at an incredible list of games houses — Lionhead Studios, Zynga, Codemasters, Linden Labs — and have worked on some iconic games titles.
Of course we aren’t the only ones to be excited by the potential of a new platform being taken on by a team who has done it all before. Sunstone and Lifeline have already invested in the company, and Rob and I are both looking forward to joining the board alongside Petteri and Yacine.
And the fact that Rob and I have both blogged about our investment in Mojiworks and will both be joining the board is worth emphasising. As I’ve written before, we’re unusual at Balderton in that we are organised as an equal partnership. As I say to every entrepreneur I meet — this is a good thing for companies we work with: you don’t just get one champion at your investment firm, you get the whole team as everyone is equally incentivized to help you succeed.
But our equal partnership structure doesn’t have to just be about what happens after we’ve made an investment, it can also be about what happens before.
In this case, coming from different angles, Rob and I were both intrigued by this market; we joined forces, worked on it together, and eventually found the company we both wanted to work with. I hope this sort of approach will grow to become a template for venture over time.
I think our industry is one where individual ego and obsession over track record ‘ownership’ gets out of control, and collaboration could actually deliver better results. In that sense, I hope Mojiworks is just the first of many.