Learnings from a decade of company building
MAG celebrates 10 years in 2020. With over 250 million people who’ve played our games, we are now a leader in word and trivia games on mobile.
Every day around two million people in over 180 countries across the globe play one of our games. The road to get where we are now was far from obvious or easy, but it turned out that with great people a promising business can turn into a pretty great one. In this article I am sharing some of my thoughts on our journey through these first ten years of game development and company building. I hope you can find a few things to learn from or be inspired by in our story.
How it all started
When starting a company, it is hard to overstate the importance of having the right founding team. You need a team that trusts each other, challenges each other’s ideas, thinks in new directions and takes risks together. That is absolutely essential to make it longer than a year or two into the journey of company building.
Our founding team all knew each other well as we had been working together for several years before the inception of MAG. It has been such a strength for us to be a group with a high level of trust in one another and without any big egos or selfish agendas. We just wanted to build something great together in a way that we could all be proud of. I will always be grateful for having had the opportunity to work with my co-founders Roger, Fredrik, Anders, Johan and Kaj during this first decade of MAG’s history.
Staying alive!
The history of how things got started is often written with the blessing of hindsight, where it is easy to see a clear path from start to finish. In reality that’s rarely how things actually play out. We didn’t start MAG with a vision of enriching people’s lives (our current vision) or to create and promote casual multiplayer games that our players love and that we are proud of (our current mission). Of course we had dreams but from the start it was actually much simpler than that as the company was bootstrapped and needed to be able to feed the six of us based on the short-term financial outcome.
We set out to build a profitable games business leveraging the opportunity that the App Store had provided. When starting a business without external funding, your mission simply needs to be to stay alive to fight another day. Of course, doing it together with good friends while creating games we all loved playing made for a fun challenge.
Finding the first hit game
What can we create that is likely to be profitable and within a time frame we can afford to fully dedicate to this project? This is a key question for any small team with a limited budget. We needed to be super efficient and not waste time on ideas without potential or with a long development scope that would make us run out of money. We looked for holes in the market that we as a team felt both capable of filling and passionate about developing. This ended up being highly polished word games localized to non-English European languages.
Back in 2011, word games were a very underserved market where we felt we could make a difference. In less than three months we, together with our newly hired Art Director Felix, built Ruzzle — a game that ended up being downloaded more than 60 million times whilst reaching the #1 most downloaded game ranking in several of the biggest western markets, including the US. The combination of a great looking product, some clever growth marketing strategies and perfect timing made these months spent developing the game absolutely transformational for us as a company. None of us involved in the creation of Ruzzle will ever forget the thrill of seeing player numbers skyrocketing and the game spreading organically across the globe.
A fork in the road
If and when success happens, it will put the founding team of a company to the test. Do we play it safe and harvest the fruits of this initial success? Or do we play the long game and try to build something bigger, more valuable, with the risk of losing it all?
This is a far from obvious decision in a hits-driven business like gaming. The odds of striking gold a second time are stacked against you. Are you willing to bet on your future ability to find the right talent, refine the very best ideas and manufacture your own luck in the form of a high enough hit rate?
More often than not it doesn’t work, and you might end up wishing you’d played it safe to begin with. Luckily for us, we all agreed to play the long game and a combination of grit, luck and choosing the path of combining our own development with M&A has led to a great outcome.
Currently running three studios in two countries and having a well balanced portfolio of games makes the next decade much more likely to end well than the first one was — given our odds in 2010 as a small team around a single desk with no prior experience of game making.
How do you keep that original high-performing culture?
The path from the six original founders to today has been filled with ups and downs. Recruitment is hard to get right from the beginning and, as the company evolves, it might not fit everyone who joined during an earlier phase. It can also be challenging to introduce new ways of decision making, planning and knowledge sharing as the group grows to cover multiple ongoing developments, people from different disciplines and backgrounds and external expectations in terms of business performance.
In 2014 we made an important decision as a company to try and create an organization with highly empowered teams. The purpose was to make sure people with the most intimate knowledge of a game were in charge of the day-to-day decisions. In order to enable teams to make their own decisions, we had to focus on making sure knowledge and information was spread effectively across the company even as we grow. This knowledge sharing has manifested itself in different ways during the years. Currently it takes the form of weekly demonstrations, regular AMA sessions, MAG jams, the yearly MAGCon event and Slack groups for public and private sharing. As the company grows, we continue to evolve in terms of both culture and traditions. This is a never ending process that is fueled by our own experiences as well as by new people joining, bringing their perspectives and skills to the table.
We believe that psychological safety is a key success factor for teams and have always emphasized the right to fail and the importance of sharing, questioning and re-evaluating how things are done. If a company becomes too hierarchical or political, things will slow down and you risk working on the wrong things for the wrong reasons. Super talented people from some of the greatest companies in the industry have joined MAG for this reason during the last few years. They know that they will get to do their best work in a free environment that is focused on trust and value creation instead of politics or vanity.
Kill your darlings and nourish the Evergreens
With a company full of creative and innovative people, you will never lack ideas to work on. The challenge is always to figure out what ideas not to work on in order to stay focused. We have developed a process for evaluating and refining ideas that results in spending as little time as possible in the early stages of development where you have too many unknowns. We want to quickly find reasons to stop a project so we can start working on something else with bigger potential. There are some clever ways of being efficient at this, as we described in an earlier Medium article from MAG.
Having a company culture where killing projects is considered normal is crucial in mobile games. You also have to consider the fact that a successful mobile game never really dies, but rather that you will keep developing this evergreen game continuously. The question becomes how to balance how many people should service the older, proven games against how many people should spend their time trying to come up with the next big thing.
Something that surprised me and many of my peers who got started in the industry around the same time was how our original hit games way exceeded our expectations in terms of staying power. When we launched Ruzzle in 2012, we could never imagine a future where in 2020 that game would still be a very meaningful and profitable game with hundreds of thousands of daily players.
After having launched games basically every year since 2012, we now have a portfolio of games of different ages and in different stages of their life cycle. This gives MAG a stability that only comes with time. In the early phase when your entire business revolves around the first game, it’s very hard to compensate when that game eventually starts to decline. But as the years go by, every new game adds to a more stable pie and you start to perform more predictively as a business.
The Exit — Selling or going public
As the business grows, so does the expectation from external investors to get a return on their initial investment. For a games company the most common outcome is selling the business to another, larger, games company that wants to complement its portfolio or simply grow its overall business. In the Nordics we have the opportunity to take relatively small businesses public on the Nasdaq First North stock exchange, which makes it possible for founders to keep running their companies while letting earlier investors exit if they wish. We decided to take this route after speaking to a few other companies that listed on Nasdaq First North before us. One could argue that gaming companies aren’t suited for being public. Gaming is a hits-driven business, which makes it more unpredictable compared to more classic industries like mining or truck manufacturing, to give two Swedish examples. But the free-to-play business models have turned games into ongoing services with more predictable long-term revenues, instead of solely being an extreme hit-or-miss game launch business. This in turn has made it easier for investors to understand and trust games as an asset class to invest in.
I am happy that we took MAG public instead of selling as we have been able to continue to build on what we have in a way that we are confident is best for players, employees and shareholders.
The next 10 years
After an eventful first decade as a games company we can now look forward to ten more years of building entertainment for a global audience. The foundation we’ve built is strong in terms of our culture, game portfolio, infrastructure and marketing capabilities. But most importantly we have incredibly talented teams that know what to do and how to do it. Our way of working makes us adaptable to a rapidly changing environment, where decisions are made close to where the action is and with the players’ experience top of mind.
Gaming is the biggest entertainment industry in the world. Bigger than music and movies combined. Everyone on the planet has a gaming ready device in their pocket and we are building highly accessible games with that audience in mind.
I can’t wait to see what MAG can create in the next decade of our history.
Good Times ahead!
