This year’s Superbowl featured an interesting type of coming out: the multiplayer smartphone game. Traditionally, game companies make money but not the kind that it takes to pay for a Superbowl ad. This year, two big titans decided to slug it out and one was the clear winner over the other.
Audiences will no doubt remember Supercell’s commercial with Liam Neeson. Definitely made to endear the brand to those watching, but this commercial did not serve to give Supercell any significant revenue bump. Instead, Machine Zone’s Game of War received the honor thanks to Kate Upton dressed as the goddess Athena.
Machine Zone is a Palo Alto based company with about 300 employees. It’s based in a tiny warehouse, where Gabriel Leydon toils away with his team creating the strategy MMO game. Leydon’s game is consistently ranked among the top in its genre, and the game is believed to be netting roughly $1 million in revenue per day thanks to a highly competitive player base.
Leydon’s game relies on a freemium model, which is the trend for free to play games these days. Companies encourage a competitive player base, but set limits on what they can realistically do without paying. Millions will download for the casual experience, thousands of so-called “whales” are the ones keeping the lights on.
While the company still trails behind the likes of Supercell, its founder takes cues from the coin-op industry of yesteryear. He claims his goal is to make games that encourage fast decisions, with the impulse to check on the outcome of those decisions.
About the Author: Samuel Phineas Upham is an investor at a family office/ hedgefund, where he focuses on special situation illiquid investing. Before this position, Phin Upham was working at Morgan Stanley in the Media and Telecom group. You may contact Phin on his Samuel Phineas Upham website or Facebook.