The Future of Digital Entertainment: Why We Invested In Holyo.com. Why Again. Why Now.
At Wildstyle Network we believe that, in this crisis-coated economy, the truly ambitious and talented entrepreneurs are now most likely to solve the greatest challenges we face. To achieve that it takes great people, a commitment to developing deep relationships with customers, and entering untapped markets and territories. We’re happy to announce an additional investment in one of our angel fund’s portfolio companies, HOLYO. Here’s why:
Recognising the achievements of a great founder-funder
As founders with deep expertise in product and operations, the Holyo team invested their own money in Holyo’s success. This convinced us to top-up every € spent with our fund’s money.
Why is the founder-funder story important? Well, the founding team has proven themself to be an invaluable asset of the venture. Now we can focus on co-developing the venture without any strings attached and with full steam ahead.
The WSN Angels & Startups team is proud to work with a balanced mission driven team here at Holyo and we’re excited to see what we will achieve together in the years ahead as the founders are looking to expand their ideas into untapped territories.
Speaking of balanced teams: Behind market need and funding, unbalanced teams are the third most significant contributing factor to startup failure. Balanced teams lead to successful early-stage ventures beacause they are…
- …providing varied perspectives.
- Balanced teams define a startup’s culture, which can make or break the business when the company grows or struggles (which is inevitable at countless points in a startup’s lifetime)
- Synergy in balanced teams lead to bigger pictures
- Balanced teams capture more funding (Stanford Business School study). When VCs or partners ask a hard question, a good, dependable team is essential in order to be able to answer the question from multiple angles.
- Balanced teams are accountable and have clear separations of responsibilities. In any collaborative setting, not having a clear separation of responsibilities always ends in disaster.
How we at Wildstyle Network value our Investments in Startups - before and after investing
Each of the M’s relies on different signals. A signal is a trigger for an action, either to buy or sell something. It’s mostly generated by analysis. That analysis can be human generated using technical indicators, or it can be generated using mathematical algorithms, possibly in combination with other market factors such as economic indicators.
However, we have to admit, that these signals are often times also experience and gut feeling. So let’s not overvalue the algorithmic part ;)
Momentum: Most attempts to quantify tech company health have almost exclusively focused on momentum. This is necessary but not sufficient. Momentum is when a variety of volume and frequency signals including social media, news/media, sentiment, and partnership and customer momentum are stronger than in other markets we look into.
We look at these on an absolute and relative basis vs peers/industry comparables. The relative piece is critical as it ensures that for example, enterprise software companies who may get less media attention or who spend less time on social media are not penalized versus consumer-focused tech companies. Holyo operates in both markets — B2B and B2C. So we have to continiously understand and monitor the signals.
Market: Simply said: You need a trendy and fancy market which sees momentum. Being in an out of this space means fewer investors, partners, media and more. It just makes everything hard to promote. You don’t want to be a daily deals company today.
Money: This category is about assessing the financial health of a venture, i.e. are they going to run out of money? Here we look at the burn rate and the quality of the investors and shareholders that may be part of the company as well as their financing position relative to industry competitors.
In other words: We need active co-investors to continiously back a company.
The COVID-19 crisis made the Holyo Team grow beyond what’s possible: New Markets, fresh Ideas
During the COVID-19 crisis (we’re still in the middle of it), the gaming and digital entertainment industry rose about 25%. While all the big players grew along with market, the team at Holyo beat the market by outperforming the average market growth by 3x. This is, as the paragraph above stated, a strong signal for us.
Focus on untapped Markets, next gen Banking Consumers and invisible Margins
Egypt, Nigeria, Saudi Arabia — is where the numbers grew exponentally. They team entered the markets with several assumptions. Some were wrong but most of them were correct.
Right before the crisis, the team at Holyo was already travelling to these markets to understand user behavior, local culture and the specific language gamers and digital entertainment enthusiasts are using.
When Customer Experience Design trumps Marketing: Holyo builds Network Effects and self-sustaining Programs at the Speed of Light
Product teams are leveraging quantitative and qualitative data almost equally to inform their decision making. Most team members at Holyo are Data Product Managers at their heart.
Marketing at Holyo means reading data, developing a CX means looking at the click path and interviewing customers.
Data isn’t always quantitative, and different types tell you different things. The team at Holyo performs this very well. From a variety of sources:
- Internal feedback from sales and marketing teams
- Data from customer conversations (social media and customer care)
- Product/platform usage data on a weekly/monthly basis
- competitive and survey data
Often times, the data part is not well structured in new ventures. We at Wildstyle Network help our portfolio companies to understand how to drive the data conversation with several playbooks.
From the very beginning, Holyo tracked metrics and managed their business through dashboards and analysis. This way they can drive their business, learn quickly and can adapt and optimize faster than their competitors.
This Playbook highlights the different ways global product teams use data to make decisions. Whether you’re looking to adapt your product to accommodate changing user needs or to improve the customer experience, the best decisions start and end with data.
We are happy to join the Holyo team on their global journey to explore untapped markets and their mission to become a critical component in the digital entertainment industry.
(Steve Nitzschner, Head of Investment Committee at WSN Angels & Startups)
Learn more about the Holyo team’s mission and their Five Pillars of success: Holyo.com/about