Bergaming
- 1. ”An investor view of gaming startups” BerGame Bergamo - March, 5th 2013 Niccolò Sanarico Associate, dPixel www.dpixel.it - nico@dpixel.it twitter.com/il_nico 1
- 2. First, some introductions Me, bullet-pointed: - MSc in ICT Engineering, PoliMi - MSc in Compure Science, UIC@Chicago - MBA, Oxford University - Today: Associate & dealflow manager @dPixel - Board Member and #1 fan, Mangatar - Past: ICT Consulting & Corporate finance experience (Neptuny/Moviri, Strempel&Co) - Ever: Geek & Tech Passionate Opinions are mine, unless otherwise stated 2 2013 - dPixel
- 3. Today’s menu • Of VC, the environment and everything • dPixel, Venture Capital Advisor • What I look for in a gaming startup 3 2013 - dPixel
- 4. What exactly is Venture Capital? cashflow corporate lifecycle ongoing growth continuing growth ongoing maturity early ending turnaround of growth time early insolvency early stage expansion stage seed start-up first second third late stage later stage stage stage stage stage stage - Venture Capital Turnaround Financing Growth Capital types of Private Equity Buyouts + debt involvement 4 2013 - dPixel
- 5. A selection of the Italian VC scene Expansion Early Stage Later stages stage Reveunes “FF&F” Time • Small investment • Average investment (€ • Significant investment (> • (< € 1mil) 1mil to €10mil) €10mil) • Business start up • Business development • Business Discontinuity • Hands on approach • Round A, B, C, D (Acquisitions, turnaroun ds, vulture…) 5 2013 - dPixel
- 6. A value proposition for VC Not Just cash! - Leverage the VC partner’s experience Active Investor - Strong focus on product, customer and go-to-market - Help in planning&recruiting (CxO, bizdev, etc..) - Support & coaching to the management team Collaboration - High standards for performance, management & integrity - Eccellenza nell’execution - Access to strong network when required Relationships - Access to international markets - Co-investments with other VC funds, support in fundraising - Efficient use of cash Efficiency - Holistic approach to resources - Create value for all stakeholders 6 2013 - dPixel
- 7. Today’s menu • Of VC, the environment and everything • dPixel, Venture Capital Advisor • What I look for in a gaming startup 7 2013 - dPixel
- 8. The Italian innovation factory • Our Team is at the core of innovation in ICT and Internet in Italy • Strong proprietary dealflow: 1600 business plans received between 2010 and 2011, >600 in 2012 • Since January 2011, we launched Digital Investments SCA SICAR, a Venture Capital fund, of which the Seed Compartment is currently active • In 2012 we launched a new scouting initiative, the Barcamper – www.barcamper.it • We are advisor for Telecom Italia’s Working Capital Accelerator project • We have built and still growing strong international relationships (Kauffman Fellow Program, Silicon Valley, Startup Sauna) We help talented entrepreneurs in creating successful enterprises 8 2013 - dPixel
- 9. Our Portfolio 9 2013 - dPixel
- 10. Where do we invest E-Commerce: Italian market Mobile Apps: 25B app download worth 8B$ in 2011, +20% with in2011, market will reach $25B by respect to 2010 (*) the end of 2015 (*) Internet & Cloud Computing: booming Digital Media market ($3.7B in 2010, €10.5B in 2015) (*) Bioinformatics: Expected market Smart Grid: market size size in 2015: $5B will double from €5.6B in (*) 2010 to €9.6B in 2015 (*) INFORMATION & COMMUNICATION TECHNOLOGY Life Sciences Clean & & Medical Devices Green Tech (*) Sources: gartner.com, techcrunch.com, scottmadden.com, ibtimes.com, repubblica.it 10 2013 - dPixel
- 11. What do we look for Team Track Record Commitment - Be ready to expand internationally Global entrepreneurs - Innovative, motivated, with track record - Ambitious and with the ability to execute - Aligned to shareholders interests and motivated to create value - Opportunity to dominate a market segment Market Oriented - Ability to capture market more important than market size - Market segmentation and targeting are key to success - Fast mover / first mover advantage? (R)Evolution - Revolutionary and evolutionary technologies: disruptive or improving? - New business models Visionaries Execution Traction 11 2013 - dPixel
- 12. Today’s menu • Of VC, the environment and everything • dPixel, Venture Capital Advisor • What I look for in a gaming startup 12 2013 - dPixel
- 13. What I look for in a gaming startup 1. Traction. 2. Retention. 3. Pipeline. Let me elaborate a bit 4. Awareness. 5. Ok, well, Team. 13 2013 - dPixel
- 14. Traction “Quantitative evidence of market demand” - Naval Ravikant • Show traction! • Ideally, in order of relevance: 1. Profits 2. Revenues 3. Active Users (MAU/DAU) 4. Registered Users Remember: you build it bottom up! 5. Traffic • Don’t have it? That’s ok, but know how to build it. Have a plan. 14 2013 - dPixel
- 15. User Retention “The percentage of a user segment who used your service in period A who also use your service in period B, where period B comes after period A.” - An answer on Quora • In the gaming world, it means players have fun with your game, and are willing to return. • So, I expect games to be fun. – IMHO, one of the key aspects of game design. – 1-day retention – 1-month retention • Understand what makes players come back. 15 2013 - dPixel
- 16. Pipeline • The Gaming industry is not anymore only about the Hollywood-style “multi-million dollar hit” • New distribution channels+gaming platforms -> web, mobile, social networks, OUYA • Fast development cycles -> graphic libraries, gaming frameworks • Fast game evolution cycles -> social, location-based • Do not rely on a hit-or-miss single title, find a vertical market, aspire to become a hit-factory*. *but be ready, as hardly every title will be a hit 16 2013 - dPixel
- 17. Awareness • As a team, you should know your strengths … • … and your weaknesses • Understand your player acquisition and retention drivers. Be able to explain them. • Ask “why” things happen. Observe. Act. 17 2013 - dPixel
- 18. The team, a MUST have • 2 / 3 founders • Complementary skills • Chemistry/ ability to execute • Statistically proven + nobody invests in one- man-bands Would you bet on these guys? 18 2013 - dPixel
- 19. Farewell Niccolò Sanarico dPixel srl Via Filippo Turati 38, Milano nico@dpixel.it - 334 585585 3 twitter: il_nico 19 2013 - dPixel
Editor's Notes
- #6: Crowdfunding: e.g. SiamoSoci (circa!), AngelList (circa!) o piattaforme di crowdfunding reward-based-Ancora non regolamentato, in attesadeidecretiattuatividellaConsob in Italia. Grande opportunita’ ma ancoragrandiinterrogativi.
- #15: Idealmente, ilmodomigliore permostrare traction parte daiprofittifino al traffico, in ordinedecrescente di importanza.Il modo in cui costruisci traction, all’opposto, parte dal traffico per arrivareaiprofitti.
- #16: Cisononumerositrattatisu game design, sulconcetto di divertimento. Nessunbisogno di essereaccademici, ma il game design puo’ e deveessereconsiderato come un’attivita’ progettuale e non puramentecreativa. Understand what makes players come back. Build, Test, Act.