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Today I’m talking with Jason Chapman, General Partner at Konvoy Ventures. They are a seed stage fund, investing in the infrastructure technology, tools, and platforms of tomorrow’s video gaming industry. With Jason, we decided to make this episode a more of a discussion, around the topic of user generated content platforms, as it’s of big interest for both of us, as we’ve seen UGC become one of the dominating topics of 2020.
Hi, Jason, welcome to the podcast.
Jason Chapman 2:41
Hi, Jason, welcome to the podcast. Hi, again. Thanks for having me. Appreciate it.
Joakim Achren 2:47
Yeah, it’s great. Great to talk with you about all the cool stuff that, you know, we’ve been planning this for a while now to do do this chat. There’s so much here. But first, how did you make your way into venture capital and to go and start convoy ventures?
Jason Chapman 3:03
Yeah, I think, you know, most people have the story of launching a venture fund, it’s kind of two stories. One is, you know, either you worked at a very large fund, like an Excel a Sequoia was there for quite a long time, and then decided to spin out maybe with a couple other principles and lunch around fun. That’s one track people typically do. Another track that is common is you know, you built a very successful company, you sold it, you IPO there’s a large exit, and then you go and join a large venture fund as a partner, or you just start termined Hey, I’m gonna go join with few friends and watch our own fund largely anchored by our own money. I was neither one of those. So I don’t fit the mould on either one of those stories. You know, my my favourite investors do fit those moulds. My research my background was I was in research at IBM, before this, and I focused kind of on two things. One was machine learning and computer vision. And while I was there, I had a lot of different clients sets across the fence across games, and across kind of fin tech and what I call hedge funds. And so that was my first test into kind of, you know, the back end of gaming, which is what we’ve kind of folks, that convoy. And while I was there, I just determined that, hey, I’m going to launch a research project and see, is there enough deal flow to watch or fund around the strategy of, Hey, can we invest in things that aren’t just purely Game Studios. And I did that in 2017, with my two, two co founders and partners, Josh and Jackson. And we were overwhelmed with deal flow in about 1000 companies apply. And story after that is essentially I pitched a lot of great founders in the industry and said, hey, look, this is my thesis, I’d like to invest into pretty much everything else in gaming as my core thesis for the fund. And we had a lot of them were crazy enough to back us and we really appreciated them and now that’s kind of our story and how we inserted into watching a VC in gaming. So that’s, that’s my story. So any encouragement anyone is looking to watch in the fund. It doesn’t have to be one of those two tracks. You created with it. And I know I have a bias. But I think generally speaking, technical investors often have an edge specifically and note the gaming entertainment world as we continuously move more towards tech, heavy investments. So that’s my story. And then, you know, before this, just as a person that I grew up in Africa and Latin America and Asia as a kid. And so that’s where I fell in love with games. And it’s never it never stopped just changes the game that I’m in love with. So that’s my story.
Joakim Achren 5:28
Was it like, did you know a lot about these see, like, let’s go five years backwards. Like, it’s already something that you were thinking about the doober thinking, that’s an interesting, you know, place to build the next 1020 years of your career. You know, if you had told me,
Jason Chapman 5:45
let’s go seven years back, that I would be a VC, I would have laughed at you. I thought, probably at the time, you know, I’m very happy and research, I love product development, I love being an engineer, I love building. So fast forward a few years into that, I started getting itch for personal investing, and really finding that, hey, I think I’m a pretty good engineer, there’s definitely a lot of engineers better than I was. And I often found myself kind of being a happy bridge between business and product. And that is something I love to do. And when I found out that VC kind of gets to do that more, that is something that really drew me in. And, you know, generally speaking, I look at VC very similar to research, there’s a lot of different projects going on, you have to really get in depth with it to understand if you want to delve into that and deploy resources towards it, whether it’s time or money. And so I actually feel like that trained me really, really well to do what I do today, which I probably would have laughed again, I never thought I would do this, but I love it. You know, I love getting to talk to our founders and get in the trenches. And just think about, you know, general business problems or product problems. That’s something I guess unique for us is, you know, we get 40 into product, because that’s where two of the three GPUs actually come from myself included.
Joakim Achren 7:00
Yeah, like really want to dive a bit deeper here into investing before we go to today’s topic. But yeah, I’ve been spending some time now thinking about angel investing, and how that could be a way to, to level up the whole gaming industry in the field. Like, how could that help? From your perspective? Like, what do you think like, is that a great way to address the needs of those early stage founders?
Jason Chapman 7:26
Yeah, I think so I can tell you how we work with angels, and how I’ve seen them be extremely helpful to founders. So we have a lot of gaming founders who’ve exited. We’re also angel investors outside of our funds, who have partnered early on and do that 25 to 100 K, check into a company kind of either first money in, we work with those guys a lot. And we have a lot of our funds. Because often what happens is, you take yourself for example, you know, you find a startup, as you’ve done before, and you’re like, this is a really good deal. Jason, you want to take a look at it. And I’m like, fantastic. And if you say, hey, look, I’m putting 25 can that obviously, you know, to me as a as a VC perks my head up, right? Because I’m like, okay, so he feels very convicted about this opportunity. Let me take a look. And this is the exact reason we have a bunch of angels in our fund, right is because we want to work with them, not only because I enjoy working with them as people, but generally speaking, they have a set of knowledge that maybe us as a team do not just like you, right, you’ve launched in company in a market that I do not have a tonne of experience. And and that’s something that I love. Right. And so absolutely, I think it’s huge, I think it’s important to note the right angels. So I think we’re seeing a lot of people that have watched studios that have done a really good job, and then they’re starting to see other studios, which is fantastic. I’m hoping to see if we get more and more angels that are kind of in the periphery industries like cloud or you know, security software, that start to then bring that knowledge also to games, because there’s a lot of business models that work in other industries, that would be really, really well and games that haven’t been tried yet. So that’s, that’s something I’m looking forward to. But absolutely, I love working with angels, because they’re usually very passionate, and they’re usually builders themselves. And who else better to have in the corner of the founder, you know, that’s true. Yeah.
Joakim Achren 9:12
Hey, now, let’s talk about what we wanted to talk about today. Which is it?
Jason Chapman 9:17
Let’s do it.
Joakim Achren 9:18
Where will the next billion gamers come from? I think that’s a super interesting topic. A lot of people are saying that now we have 3 billion, but like five won’t be that far. way in the future. Yeah. What what comes quickly to your mind on on the whole like premise there of like, when we went from two to three, like what’s going on? Yeah, it’s
Jason Chapman 9:41
I you know, I think Yeah, generally speaking, you know, something always kind of lead with with people that are new to the industry is, you know, 1990 500 million people play video games. Today in 2020. You see numbers floating between 2.5 to 3 billion wherever we are in that actual spectrum. So it’s an exponential growth. And that’s definitely been fueled by a lot of different things. You know, generally speaking, I think it’s two things that have fueled it to where it is today. It’s the, you know, the social element that has been fueled by the internet. And so, you know, gaming is now just inherently very social, where instead of, you know, playing by yourself, we’re playing with your friend next to you, if you know, you guys remember kind of like 64 days where you’d play Diddy Kong Racing, or whatever it is, and you’re, you’re gaming next to your friends. But that’s the only time you can be social in games, that is not just totally changed, right. And I think that’s fueled it where, at any point in time, I can go play with other humans, which is almost always but not always, because I’ve a lot of games, or I love playing computer as well. But love playing with people. So I love that part. That’s fueled it. And the second is, you know, more and more of the world is just coming online. And so I think that is what’s fueled us to this point. And I kind of think the next three things that are going to drive us to the next billion gamers, it’s going to be UGC. Absolutely. And I think we’re seeing this now, like with the proliferation of, you know, Roblox and Minecraft, and, you know, Halo moving towards a platform with their forge community, which I love to talk about a little bit more, which huge Halo fan, so love that. A lot of franchise. That’s one thing. Secondly, yeah, the developing worlds coming online, I think we’re at about 46% of the developing world has internet that’s up about 6% over the last two years. So I think that’s going to just continue to push this. And then thirdly, and this is I know, we want to talk about this as niche communities. I love the evolution of new niche communities and games and how we’re kind of building games for groups that people didn’t have games built for them before. And that’s, that’s, I think, where we’re gonna get next billion people, so developing world, etc. and niche communities. It’s kind of a three thoughts. Do you have anything you want to add to that? I don’t know. Those are kind of my.
Joakim Achren 11:53
Yeah, I want to start. Yeah, I think UGC works in a way, like differently. What did did previously, like I started doing UGC, with my first company in Facebook, back in the day, it was like, as a business owner, I didn’t really know what I should be tracking regarding is the business going forward? Are we retaining more users? That was one metric? How do we keep users in this UTC world? I think the the models there regarding motivation for creators, when you can have the best tools create the most, like personalised experience that you want to develop, deliver for your audience. Like that didn’t exist 15 years ago, which now with Roblox, and those kind of platforms, like hiber, even Minecraft, where you can like customise a server and open it up to a different kind of models. I think the those tools weren’t there back then. And now, it means that the developer has really good leverage From the creators who see opportunities for themselves as well. True, like, how do you monetize that content? I think that’s, that’s what unlocks the possibilities. Now that didn’t exist before. There’s a lot of reasons but that’s, that’s sort of like, the big beef there for sure.
Jason Chapman 13:20
When you think about you see, you know, something that I think a lot about is, you know, how do you make your platform job a job creator, right, like, and this is Kevin, kind of something I think about a lot with, you know, I think Roblox has done a really good job with this where, you know, you’ve actually enabled millions of creators to have jobs. And so how do you how do you enable that? And I think you’re absolutely right, like the tool sets to do so. That is tough, right. And this is something a theme that I love to invest in personally, is platforms that create jobs, right. And there’s two kind of instances of that are three instances now that our portfolio, and that’s something I love to do, right, like dorians doing this for niche communities for storytelling games. Really excited to see that team launch later this year. Also, no hiber you mentioned them like, that was a huge part of my thesis of, you know, Roblox is on this really well, I think there’s an interesting way to make this even a lower barrier to entry for creators to then monetize in the future. And then, you know, offer them giving shameless plugs to my my portfolio right now, did this for streamers. But this is a theme, you know, I always tell people, like, hey, if you create jobs for other people, and you’re creating a platform to do that, please talk to me because you know that that is how you, in my opinion, change an industry, right? And that’s how you change. I don’t know, just the general outcome for people who have saved them from really bad vocations. They don’t actually want to get into and that’s something I, I personally am very passionate about is like everyone should be in a job that they feel they add value to and they have meaning in and you know, that’s something I love investing into. So
Joakim Achren 14:54
yeah, yeah, like all the tools that are now just in the last few years. Yeah, thinking about like how the model, the creator economy model really, like came up with substack old enough road tools, everything in place, and that’s happening in gaming for sure as well. So just wondering like, what is something that’s still lacking in that sector? So we have now Dorian was doing storytelling, UGC. You specifically have Roblox hiber doing like these kind of like more like 3d virtual environment experience is. I think there’s still like, how do you on lock them? The same aspect for people who, who are not fans of either of those activities?
Jason Chapman 15:45
Yeah. I always use my wife as an example in this actually where she is not, what you would think of is she wouldn’t classify yourself as a gamer. She does play games, but and I kind of think she’s the perfect fit for somebody who doesn’t feel like they’ve had games built for them. Yeah, that intrigued her, right. She loves interior design, this the passion of her she’s very artistic, you know, and in glue created a game right for this, where you can go build and design and buy things and build your home. And that is something that, you know, it’s caught her eye, right? I think, you know, games like that, that are unlocking creativity and people, you know, generally speaking in maybe in the other arts, and how do you like gamify? That experience? Right? Like, you know, we’ve looked a lot about UGC elements for for music, like, if you’re a creative person, but you don’t know how to play the saxophone? Could you still create something in that in that medium? And that’s the type of stuff I like to see is like, how do you lower the barrier to entry for creators? And you know, as a developer myself, right, I’ve, I’ve actually been disappointed often with the no code engines that have been claimed, because I will get on there. And I’m like, absolutely. This is not no code, I still have to be able to write lines of code. And yeah, I can, because that’s what I did before. But, you know, most people aren’t going to take the patience to write a script, right. And I think that’s something I’m actually looking for more proliferation. And I think there’s a couple groups that are trying to do this well, and I really commend them for that. But generally speaking, I’ve been a little disappointed there. So I think there’s opportunity and then I loved when he said ahead of this call, you know, we’ve talking back and forth about the sub stack for games. I want to see somebody do a subscription to modders right, like where? I mean, if people subscribe to streamers, why are they subscribing to people? content creators for building cool, like, Halo? mods, right? Like, I would totally do that. I totally
Joakim Achren 17:39
agree. And so if the week kind of thing or something, yeah,
Jason Chapman 17:42
yeah, like a level of the week, or like a weird gameplay of the week, like, absolutely. Like, if I you know, if I subscribe to doctor disrespect, or anyone like that, like, I would definitely subscribe to my favourite modern Forge. Right. And so,
Joakim Achren 17:55
you know, I mean, like,
Jason Chapman 17:56
Yeah, because, you know, they’re producing product I want, which is entertaining. So that’s definitely something I’m thinking about. Yeah. Do you think you could see that in mobile? How would you see subscription to modern mobile? Because that’s, I don’t know how that would work personally. But that’s something I’m interested in trying to figure out. If somebody could do that. I think it’s sort of like there’s some stuff like that happening. subscription wise, like modded environments. So we have a startup in Finland, who is doing like a Minecraft day care
Joakim Achren 18:28
for like kids. So they’re, they’re basically like, you know, they have a modded server, which is safe, they have a teacher there who’s guiding the kids. And they’re not small kids, it’s like seven to nine year olds, who are familiar already with gaming. But it’s, they’re really seeing good numbers with this kind of early tryouts of having a subscription model where then the parents are now allowing the kids to go into safe environment where they know that they have interaction. So it’s, it’s not a solo play. It’s multiplayers It’s a super interesting way you can call towards that tangent of how do you then bring that to the leisure of adults and people who want to do something besides watch Netflix? You know?
Jason Chapman 19:19
Yeah. So interesting. Right. And I think, you know, I remember talking about the, the Minecraft daycare. And, you know, I think generally speaking, that’s hitting a massive pain point right now, right with with parents, just, I mean, every parent I know, right now is very concerned globally, right, like feature of education for their children, right, like, and I’m not an educator, so I speak with a lot of grace for those who listening that, you know, do know a lot more about education than I do. But generally speaking, like, I think, you know, there has to be a new way of potentially thinking about caring for your kids and also educating your kids and I think games is a big part to play in that right and this is You know, it’s still a little bit of a tangent here. But you know, our attention spans have been shortened dramatically. We have been trained to have short attention spans by just about every application we use. And that impacts how kids learn. And so how do you learn and teach kids in short form? And I think gaming is probably one of the most compelling arguments for me on that where, you know, how do you how do you get a kid and so I’m not surprised that daycare and Minecraft is super well, because you’re tapping into teaching kids in a format that they like to learn in, we’re just taking care of them. And that’s, those are both just great missions. So that’s awesome.
Joakim Achren 20:40
Yeah, thinking about this attention for any human like, people are learning to multitask with their devices and the real world, interacting in both at the same time, like watching TV, but still being on the phone and going through your apps, like, you know, you have five to six apps that you always go through. So that that model could be a place where somebody could come along and, you know, inject some kind of experience that utilises the it sort of feels like, do you have Candy Crush there, of course, one of your six apps that you’re launching, but could that be much more than that? Like, what is hypercasual? doing? It’s also invading that kind of realm? How could you bridge the gap between the real world activities and what’s going on your phone and think about cross platform play? Yeah,
Jason Chapman 21:32
yeah, I think that kind of that passage of time, you’re like, watching, I feel like, when I sit down to watch a show, I either make a decision, I’m gonna watch something that I’m gonna pay attention to, or I’m watching kind of just passive entertainment. I mean, it’s just kind of in the background that I’m sort of loosely, caring about, and I’m on my phone doing a million things, right. Like, know, whether I’m on Instagram, or if I’m on my email or from LinkedIn, whatever it is, or if I’m trying to become a day trader on Robin Hood, which I’m not very good at. So you know, that’s, if anyone has tests for me now. So those are the types of things I typically turn to. Absolutely. And I think that you’re right, right, you know, when we look at the growth of hyper casual, I mean, specifically speaking, you know, a lot of that’s been growth in over the last couple years, right, a lot of aggressive entered by hyper casual for downloads. Now, obviously, the majority of that is women, too. And I always kind of joke with my wife that she’s able to multitask a lot better than I am. And I think, you know, like, are we actually capturing that, that that value? Well, where she can watch a show, play a game, and be talking to me at the same exact time? I can’t do that. And so thinking through like, hey, how do you? How do you merge those experiences, and maybe design a game for that exact experience? I think you could argue Candy Crush might be the best example of a game built for that, that moment in time. But I think a lot of people might be missing that, just like that kind of. That’s who your player is. And that’s when they’re playing this game. They’re not playing this game commuting. They’re playing this game, in that weird social entertainment. Circle. No, no
Joakim Achren 23:03
sound. Yeah. Yeah. Thinking about the kind of, if you put hyper casual casual core gamers, like, it still goes in thinking about like, what is the niche audience, then, that is not yet being catered to? Yeah. and expanding from there towards like, there was a big deal about like, what epic has been doing, when they’re there kind of approach with fortnight with the publishing model that they have, and also the the revenue share that they’re doing with the developers who they’re publishing, like, you know, they want to cut the 30% down to 12. And they want developers to invest that leftover cash back into development, which basically helps the whole industry, I think that that’s an interesting move, in a sense, like, how do you unlock the next billion players to come in? Is by just experimenting like crazy.
Jason Chapman 24:03
Yeah. And I think that’s a good example of epic, you know, fueling? No, because it’s not just kind of getting back to that point of like, creating more jobs in the industry, like fueling growth in the industry like giving, giving more of that budget back to trying to, you know, obviously, everyone, everyone’s probably looked at, you know, the drama between epic in Apple and Google and, you know, all the we can have a whole podcast just on that. But generally speaking, I agree with you. I think that’s a great way, I think we’ll look into like, what communities aren’t being reached. Like, I think there’s a lot a lot in the post Roblox age of first, specifically women. And this is what led us to andorian honestly, where, you know, once you know, once, there’s a younger woman, you know, over the age of 18, a lot of games aren’t built necessarily for for her, and that’s something we’re looking at quite a bit. I also think there’s a lot of geos and I think we’re gonna see more geo focus games where like, something Heron Africa, I haven’t seen a tonne of games built for that region. And I think that that is just spot primed. I also lived in Mozambique for quite some time. So that’s my hits close to home for me. So I’m looking for that type of thing as well.
Joakim Achren 25:14
Yeah. Yeah, recently had this webinar with Mitchell from net speak games. And we were talking about this game literacy for what people have, like they’re, they’re familiar with certain games that they’ve played previously. So as a, as a game developer, you don’t really think that, hey, we need to teach match tree mechanics to all our players, because 80% will already know mastery if we’re doing a mastery game. So you can skip that part and go into like, what’s fun and new. That also unlocks a lot of room for that experimentation to actually start happening. You don’t need to go crazy, you can just think about like, what is the extension for this audience loves? The Candy Crush is the hyper casuals, what kind of experience like spectrum should they have going forward? Do they want, like, similar convenience to the gameplay? Is it more elaborate? Usually the more elaborate like, audiences don’t really go for the more elaborate they usually stay where they are already. But it’s it’s it’s more different kind of things regarding flow and the emotional side more like nailing down the right kind of emotions and like storytelling, do you
Jason Chapman 26:33
think that that will draw new players? Or do you think that will just keep old players engaged though, because, you know, if you’re just deploying new mechanics, for an existing audience, you know, what I kind of always say is like, for instance, I don’t think, you know, and I love the Call of Duty franchise, I’ve played every single one. And I love them still. But you know, they’re not, they’re not drawing in my opinion. 100, you know, tonnes of, they’re not going to draw on the next billion gamers themselves, because they’ve served that audience so well, and they’re monetizing that audience over and over again. I just don’t know if that is, is that the way we get the new gamers? Right. And, yeah, personally, I think, I think not, but maybe incremental growth like but it’s not going to be like, A ROBLOX style growth where we got so many gamers, in my opinion from like these younger creators that fueled that growth. Everyone’s like that, like, Yo Kim can build on Roblox. I can build on Roblox and then that that kind of happened a lot within like these, you know, younger communities of creative people. And then they got a lot of players too. So I don’t know, that’s kind of how I’m thinking about it of, you know, genre that’s really interesting. Also, to me, like that is kind of a spin off and maybe sort of hitting a little bit what you’re talking about is shooter looter, right, like, is that a new enough genre? That’s kind of a tangent a fork off of shooters, that would grab a bunch of people that didn’t really get drawn specifically to a traditional shooter, like, I don’t know, it’s like, so maybe the question we’re asking ourselves is like, is a fork enough to grab a new community? Or does it have to be something completely different? And I think of it kind of like a GitHub repo, like, Are we just starting new? Or are we literally forking off and building off of the base? And that’s the growth that we’re gonna see. I lean towards a new a new thing. But I don’t know if you have thoughts on that.
Joakim Achren 28:25
Yeah, I’m thinking like, there’s new games that’s read through word of mouth, like couple of these big games coming in come, like every year. I think there’s always that excited audience that will jump on it. But it definitely feels like that word of mouth also spreads to the audience who, who might have just been looking for some big game to play for the next few years, yet they haven’t found it. And they sort of like churned away from gaming. And thinking like, fall guys feels like one of those games, which really, like activated a lot of people again, for something fresh, then red Hill games in Helsinki, who are doing like a, like a tactical shooter, for like, men in their 40s and 50s. Who definitely don’t fit the kind of life the audience like playing eSports shooters. So it’s how do you draw back the people who have churned out is also interesting. And I think that that word of mouth and, like spreads also, to new gamers
Jason Chapman 29:31
will pick it up because they’ve, they’ve seen that this is a there’s a recommendation out there for trying this things out. I think like actually, the red Hill example is a perfect example of kind of a hybrid between the fork and the new because I call that the like, the perfect age for people that love golf, right, like 14 to 15 year old men like and like really, you know, I play golf. I’m not good at golf, but I do golf because I like to be with my friends when I golf. And so I’ll go out there and I’ll make a full Myself and I’ll swing the club and, and everyone can laugh at me right and I love doing it but and I totally get people that also never want to be in that experience, but they still want to have friends and time with their friends. And maybe they don’t want to just go to a bar and get a drink, right? And so I think they like the tactical shooter Redhill is doing with 40s and 50s. It’s feeding that need of 40 to 50 year olds that want to socialise with each other, and maybe didn’t find a game like they don’t want to go on CSGO because you have to have insane reflexes and I and coordination to be somewhat competitive, right? Still my favourite game of all time. So I’ll throw that out there. And I’m still working on becoming better. But you know that I think that’s a good example of like a tactical shooter, something everyone understands, in my opinion, who’s played most, you know, first person shooters are but you know, it’s fitting a need of a new model, a new new age demographic that hasn’t been served well running.
Joakim Achren 30:52
Yeah. Yeah, it’s so much about like, how do you unlock new territory? So like audiences, and age is really something that is worth tapping into. in that sector?
Jason Chapman 31:05
Yeah, so we got age, ages, new audience, maybe don’t consider and then we’ve got I think gender is always one that you should be thinking about two and then there’s, ah, God, maybe those are the three buckets to think through. And you can create either a fork of a new fork of an existing game to try to fit one of those three, or you just have to create something totally new. like MIT like a fall, guys, right? That was just it the world by storm. And I haven’t studied that job, I think called genre, a genre well enough yet, but that came out of nowhere for me, right? Like, I was like, all of a sudden the entire world is is freaking out. Playing this.
Joakim Achren 31:44
Have you thought about like these other new platforms? Well, technologies, think about blockchain. Virtual reality, augmented reality, are those technologies that could broaden the the whole range of the games market. What do you think? Yes.
Jason Chapman 32:03
So we we’ve spent a lot of time in blockchain and AR and VR, and a couple other modes that I would say are new formats for for attracting new gamers. The thing with blockchain for me, which I haven’t, you know, typically, when you look at blockchain technology games, you have described the database question, it’s like, why don’t you just use a standard database? Why are you using blockchain in this game? An argument that a founder rightfully push back on me when they asked that question, they’re like, there is an audience of people that are crypto enthusiasts, that potentially could be gamers, because but they like crypto so much, they will then become a gamer. You know, I think there’s an argument there. I don’t know how large that community really is a people that purely will play games just because they want to use crypto in a real world environment. Yeah, you have to be a real enthusiast to do that. To date, I haven’t seen a very compelling argument for blockchain and games, I think, generally speaking, everyone cites the transferability of assets between one title to the next. I think that, you know, obviously, everyone has their walled gardens right now, they’re not very incentivized to do so. And the only way this will take off is if a group like fall guys, or, you know, a new fortnight that goes viral has this feature. And every then every user then gets trained, saying, Hey, I expect to be able to take money or like my assets out of this game and easily move it. But you know, why on earth a games company, openly subject themselves to that? I don’t know. I don’t know. I mean, you’ve you’ve run studios before, like, how would you think through somebody pitched you and said, Hey, I want you to use blockchain in your game, because I want to be able to move assets from your player base outside of your ecosystem. I mean, I would probably buy thought would be why on earth would I do this? unless my users literally had pitchforks at the fences, demanding that you do that? Yeah,
Joakim Achren 33:54
yeah, I actually have a analogy for this from like, because next games, we’re working with external IP. And when you’re negotiating with a Hollywood studio, usually you have a minimum guaranteed. Yeah, so if someone comes to my gaming studio with a blockchain technology, they can fork up a minimum guarantee, you know, of like, few million. Yeah, let’s do it. Let’s try it out. And you can earn it back through what you make out of the technology isn’t that kind of approach, I think is like doable. Especially, you can reinvest those kind of investments back into more game development. I think, going back to the ideas like in gaming, if there’s ways to explore new stuff quickly. That’s the better option always. If blockchain somebody comes along with blockchain, which is unproven, it really is not that easy selling it to anybody really. It’s you have like a million things that sort of sound better at the moment. And, unfortunately, but yeah, waiting to be something there
Jason Chapman 35:04
I am too. And, and I know I’m sounding like a hater on this call. And that is definitely not my perspective. Like I own crypto, I’m excited to see, you know, less walls and more open gardens right for people to play in. And I think there’s a lot of people trying to pioneer that. We haven’t made a bet in this space yet, because we we haven’t seen, we did actually a survey of a lot of gamers and less than 1% said that they would demand this kind of functionality. And we’re like, that’s that’s it? Like, it’s just not this decided that it’s been needed. I think it will happen. Just when and I think it’s we’re quite a ways away from that. So I don’t look at blockchain as as a, a formation for a niche audience that brings in the next you know, let’s call it almost I think about it, like a block of gamers, let’s call 100 million people a block, right? Like, I don’t think that’s going to be the cause for 100 million new gamers to come in. I do think that AR and VR will do that. And I see some really cool stuff. Generally speaking, we haven’t invested into any of it, because we still think it’s too early. And, you know, people have been been thumping the VR AR train for, you know, over a decade, right? Like, and, oh, in five years, I love that answer, like, oh, in five years, it’s gonna be really great. Like, we’ve been saying five years for I think about 15 or 20 years. But you know, it keeps getting pushed back. But I do think that is an actual medium that when we have, you know, the barrier for entry continues to lower for people to buy headsets, new great titles get released there. Yeah, I should play a really, really cool game is an NFL game in VR is really neat. And I, I think that that’s going to bring new users, right, because that stuff that my parents would put on and be like, Oh, my goodness, this is so cool, right? And if my parents think is cool, that’s usually a good indication that it’s a new, no, an age demographic, that isn’t gaming, to be honest with you. So maybe I could get in an older age through VR and AR actually come in and play games. Like that’s interesting to me. Yeah, absolutely. How do you think about really quick modding, fitting into UGC and kind of like bringing in niche communities like, yeah, this is, you know, obviously, something that’s tilted heavily towards PC, generally speaking, at least historically, and I think we’ve seen a couple examples in console, and also mobile. But, you know, one example that I always think of as no big bang racing, right, they had, you know, 8 million levels created by players. That was a huge success thing. It started in 2016, roughly, and was a good example of how do you deploy and I know that, you know, you guys also did some UGC, mechanics previously, so we’d love to hear your thoughts on mobile. And you’ve seen what what are we looking at there? Because that’s, you know, obviously huge growth, biggest population of gamers. How do we make UGC happen more in a more preferred way across the industry? and mobile?
Joakim Achren 38:02
Yeah, there’s, in a sense, like thinking about the engagement there. Can you quick, how quickly can you figure out if the engagement numbers are strong enough, even for a game, which has a lot of UGC elements in it? But it’s it’s how good are the tools? How much engagement there is already? I don’t think it’s specifically for mobile and it different from many other platforms. It might be that the enthusiastic will be preferring a different platform for using these kind of tools. If you’re building an elaborate like Roblox experience. Yeah, mobile is probably not your place. And then then if you need to dumb it down, it might be it at all. We don’t have any creators here because they they love the tools that are on the PC environments. And that that that might be that’s sort of like for me feels like, okay, who do they then have in that ecosystem who’s willing to do something on mobile since there’s already a good audience on Roblox so it needs to be something totally different. I think Dorian is in a good spot to actually utilise UGC for an audience who prefers mobile Boston, like thinking about Big Bang racing, which was a UGC game made in Finland. That team I think struggled with the aspects of, hey, this, the promise of the game feels like it’s an arcade game sidescrolling racing game where you create levels. I think the depth just wasn’t there to be compelling enough for anybody to jump over from the PC, sort of where they’re familiar and comfortable working with UTC. So yeah, mobile is tough. If you want to do something more elaborate
Jason Chapman 39:59
Yeah. Now I’ve thought a lot about like simplistic mobile EGC. Right, like, and that’s, I think what I agree with you, like Julia and the team at Dorian are, why it works so well is because it isn’t super complex, right? Like you’re not creating these ultra massive platformers that have all these hurdles, like, that’s perfect for mobile, where you can honestly see the interface to build such a game, right? Like I, you know, I laughed, I was creating a game and Dorian when we were looking at doing due diligence on them. And I’m like, how it’s so easy. And that’s what I hope to see kind of, and maybe that’s a good example of what first threshold for mobile UGC has to be just how how, what’s the time to create a game? Like, maybe there’s a time threshold? Like, if you can’t create a game in five minutes? It doesn’t work, right? I don’t know, like, is that the, we always try to think of this internally for us is like, what’s the what’s the hurdle for success? And like, what is the founder asking us to believe? And, you know, I’ve struggled to come up with a criteria for mobile EDC, where I’m trying, and I often feel like the founder doesn’t even know what they’re pitching me. They’re like, I don’t really know what you have to believe, make this succeed. Other than, you know, beyond what’s called superficial, like, gaming’s huge, like everyone’s moving to mobile like, so. Do you have any, any thoughts on that, like a threshold for?
Joakim Achren 41:18
I think they’re there? Yeah. Think about like UGC games. There are tools out there already to create. Well, hyper casual developers, they’re, they’re creating new core gameplay experiences once a week, like an experienced team won’t have any issues, building out some cool, cool gaming experience. So it might end up that suddenly, we get more applications or games on the App Store for mobile, which, which are sort of like collections of these hyper casual experiences inside one game that might come up. I don’t know, is the value proposition, the right one for the hyper casual gamer, though? So it? It really depends? And is the the audience who is seeking for that kind of an experience where they, they have a lot of cool stuff, which is created by their favourite creators? Is it? Is it matching what the hyper casual audience wants? So
Jason Chapman 42:19
that’s a good question. I’m not a huge hyper casual player. Mostly, I do play. But I typically think of, you know, usually, Yeah, so the question is, like, do or is the hyper casual audience want to be creators? Like, do they want to create or do they just want to consume, and I tend to think specifically with younger demographics. People want to express themselves and not just go into one way entertainment, and want to kind of get into it into the mix and express themselves in, in creation, even if they don’t know it, if you give them the tools they will create. That’s my general thesis. I don’t have a lot of data points to point to that right now. for you in hyper casual, but that’s my hunch. And any happy to have someone smart, prove me wrong.
Joakim Achren 43:06
I think there’s a lot of discussion about the tic toc for gaming thing coming up at some point, what it will be? That’s a good question.
Jason Chapman 43:16
Tic Tac for gaming, you know, you know, who’s gonna be positioned? Well, to do that, you know, I’m, I kind of thought generally speaking, you know, obviously, with the tick tock pending sale and all that, you know, with Microsoft, like, why would I think that it would fit well, is because Microsoft really doesn’t have a lot for mobile at all. Right. And, you know, they don’t really have much going there. And so, yeah, tick tock for gaming has positioned well to do that. Maybe it’s Tick Tock itself with Microsoft. Right. Like, and I think like, I think that would be super fascinating. I, I, I tend to agree with you. I think that like, you know, absolutely, there should be a tick tock for gaming for mobile, I think. Absolutely. Absolutely.
Joakim Achren 43:57
Yeah. I’m so happy. I’m not doing any more like games at the moment. So I don’t need to come up with the concept.
Jason Chapman 44:07
Yeah, I’m asking, yeah, you’re just you’re just hanging out there in Finland and Shaolin and I’m asking you to think of the next billion dollar billion dollar mobile game. I love it. Yeah,
Joakim Achren 44:17
I think like, looking at the kids, like how they use Tick tock, and how they’re playing games, how loud it is, like both experienced so it sort of feels like there’s a lot of commonalities in consuming content like that, versus what a red Hill gaming shooter audience wants from a game. And just going back to the age, again, like how do we cater for different ages and like the demographics regarding that, like, what do you really want them on your devices?
Jason Chapman 44:53
Yeah, that’s harsh. That’s crazy. Yeah, I I don’t know. Right?
Joakim Achren 45:00
No, no, no.
Jason Chapman 45:01
Yeah, no, it’s gonna be interesting. I think the next couple years, you know, with when it comes to just like identifying new audiences, it’s going to be, I think, I think we’re kind of primed for pivotal platforms to form right now. Like, you think about it, when was the last platform that really got launched? Right. And, and that’s kind of what I’m waiting for. And something that I think, you know, I’m really bullish on Halo, and the future of like, no chrisley at 343 is, like talked about it a lot where this don’t expect like Halo infinite to, right, like this is, this is the next decade plus of, of Halo. And I think we’re just going to see tonnes of these new platforms create, which then create the UGC element for people that weren’t creators before to build for the already kind of dedicated audiences, like, I’m waiting to see like, what, you know, besides Halo, who’s the next platform is gonna watch like, Where’s the next fortnight, right? Like, you know, where is that? Because, you know, in my opinion, like these things don’t have they do have a shelf life if you do not have an active UGC community building things for you where you’re essentially outsourcing game development to your your audience, which is just a brilliant business model. Right? Yeah. Actually kind of reminds me a lot of Have you ever listened to the founders of Duolingo talk but essentially, you know, if you get your if you build a platform, have clients that are paying you which is the players but then you have people creating content, you sell them to your players a year just facilitating transactions and handing Bhutan’s left and right. Right. It’s a brilliant, that’s a brilliant business model. I mean, I, I love that. And I think Duolingo did such a good job. With that. Personally, I’m excited to see more platform plays with with devices. And I don’t know if you have any thoughts on that. And the second thing I wanted to ask you about is what do you think the right ratio is to creators to players to achieve that kind of platform style of play? Like, what’s the, what do you think?
Joakim Achren 47:00
Yeah, well, I think it’s, it needs to be attractive for the creators regarding the monetization. Yeah, so depending on the business models, like there’s, there’s definitely going to be a lot of business model experimentation going on. And the younger the audience that usually the monetization then won’t be, as, I think, might not be as lucrative. So but if you go for, for like thinking about like, substack, as just, you know, disposable income for the people who subscribe to sub substack. newsletters, if you have something, which is a gaming experience with similar business model, similar, like disposable income for users, I think the ratio would be probably even like 2000 audiences for per creator, like one to 2000. And then you’re already pretty, pretty well off as a day job of just creating. So yeah, it just scales from there. If it’s less income, then you want to do like one, like 10,000 per creator. But somewhere in that range, I think it’s really interesting. But then, then it means that the nice audience won’t, might not be enough to actually sustain UGC, if you’re doing it for a group of players who have less disposable income in place. I think that’s,
Jason Chapman 48:25
that’s a good point. That’s a good point. So with a niche community is the UGC model feasible, long term. Right? It has to it has to be, you know, I guess our definition of niche needs to be defined, right? Like, is it 10 million people? Is it 100 million? What’s your total addressable market?
Joakim Achren 48:42
Yeah. And are there kind of like Venn diagram thing? Is that where you can actually bring into bigger groups where you dissect like, sort of middle ground for? For audiences? I don’t know that those kind of thoughts are, are definitely interesting. And one way to, like, I want to repeat this process, thinking about like, gaming should be a lot about experimentation and just trying out different things, different audiences, with the audience, first in mind. And then what do we build for the audience, we build something we see if it works, we run tests, soft launches, learning to that kind of process, I think will bring us more of these good games, bigger audiences
Jason Chapman 49:29
with that, like and this is I mean, you’re hitting it really cute. Philosophy and like development in general, like iterative cycles, right? And like, quick, iterative development, right. And that’s, that’s what I mean, one of my favourite things, like, as a developer, myself, like about gaming is is how quickly you produce things and get feedback on things. The product feedback cycle of a community that is vibrant, is literally minutes, right. Like it’s, it’s shocking, you know, I love also the audacity of gamers In the sense that, you know, it’s always like what as soon as something’s launched, everyone then starts to rip and try to mod it and make it better and be like, I can do this better. Like, there’s a lot of confidence in the community. And I find that hilarious and also very endearing at the exact same time where, you know, that is kind of what, at the essence to your point, gaming gaming and gamers are? Yeah, is just, we think we can do it better. We think we can make it a little bit more intriguing or have a better hook. And I love that I like and there’s very few places in the world. I don’t know where else actually where you could find a more engaged community. And they just care, right? Like, and they care a lot about the experience. And so absolutely, I I never in my mind questioning, are we going to keep pushing boundaries in gaming, because that’s just not the player base that’s like, that’s not in the DNA of gamers right now. Which is probably scary for people who run studios, often for themselves, like, you know, just nice thing about a vibrant community is that they’re vibrant, but they can quickly turn into a vibrant mob, as well.
Joakim Achren 51:09
Of course, that’s today
Jason Chapman 51:12
Today today for her Game Studios. Absolutely.
Joakim Achren 51:16
Hey, I have some final questions for you. Absolutely. You’re on my podcasts.
Jason Chapman 51:21
Absolutely. Now you got the surprise questions for me?
Joakim Achren 51:24
Yeah. What What’s your favourite book? Jason?
Jason Chapman 51:27
All right. And he would choose that okay. Yep. All right. So personal favourite book of for enjoyment is Ender’s Game. And so I have loved the entire Ender series. And so I’ve probably read that book, at least 10 times, whenever I’m just wanting to kind of relax and think through and so whoever, whoever hasn’t read that book, please do. It’s a fantastic story. I think there’s a lot of correlations, also the gaming world, for a business, or like kind of like a development book, a book that really changed my thinking as an investor is, is a book called pioneering portfolio management. It is dry, it is not going to be something you’re going to read and can’t wait to turn the page. The next that’s Ender’s games, if you want that go there. But it was it was written by a guy named David Swensen, who managed deals and down it still does, which is arguably one of the most successful endowments in history. I think he is probably one of the more underrated are not not as well known investors outside of I’d say, like endowment circles or venture fund managers. And I think there’s a lot to glean from that. And so anyone who’s interested in angel investing, I would really read through this. I’ve learned a lot about diversification risk from this. So yeah, that’s definitely a book I would encourage you to read. I have to ask you back. What’s your favourite, but I mean, I know it’s your podcast, but you have to you have to let me know as well.
Joakim Achren 52:48
Yeah. I never thought about it. I’m constantly checking back into a lot of books regarding Charlie Munger doing okay. Yeah. Yeah. So maybe Charlie’s Almanack is, is my
Jason Chapman 53:02
favourite. I haven’t actually read that one. It’s good.
Joakim Achren 53:05
Jason Chapman 53:06
man. It is. Yeah. My life changing?
Joakim Achren 53:09
Yes, it is. And it keeps on giving. That’s the cool thing.
Jason Chapman 53:16
There’s, I think that’s, it’s so cool. So in our day and age is that we have access to the thoughts of people that are so much smarter than we are. Yeah, in seconds. Right. And like, you know, that is new, right? And I think the distribution of information, right, like, it’s something I just love, right about the day and age we get to live in, where I don’t have to run to the library, you know, miles away to read a book, like I can literally download it. 25 seconds after we get off this call, right. Like, that’s amazing. It’s amazing. It’s one of the best things about our day and age.
Joakim Achren 53:50
Hey, do you have a story that has shaped how you approach your work today?
Jason Chapman 53:55
story about how I approach my work today? That’s a good question. So truthfully, it’s something that when I think about kind of my, my job and my vocation right now, right, I think about how I got my job, my first job out of, you know, at a university, I had a lot of people help me along the way. And so I, you know, literally the way I got my job was I had a bunch of alumni from my school that were all over the place, right? And I had 50 companies that I wanted to work for, I went and said, Hey, if I have alumni that work at this school, I’m going to, you know, ask them to refer me to a job. And I had a tonne of people help me out. And I got a lot of job offers that I probably didn’t deserve to be honest with you. And, you know, when I think about my work today, I know how much people helped me. And so often, you know, the way I try to think with founders is, you know, even if we don’t invest, what can I do to help you just because that’s what people did for me. And so you know, something I always kind of had People even that we invest in or don’t invest in is like, Hey, you know, people are helping you help people behind you as well, that’s, uh, you never know how it’s gonna work out or pay back forward. I also will tell you, it’s very gratifying when you help people, even if you don’t financially benefit from it at all. And so that’s something that I think of also just generally speaking, you know, I grew up in a lot of places that are very poor countries. And they’re not really jet necessarily a story, but just kind of a general mantra for me of just thinking through, you know, how do we use games, which can provide jobs to people everywhere in the world. And this is a language everyone speaks, everyone speaks entertainment, they like games, everyone is willing to try again. And that is something I am on a personal mission to do to bring jobs to the developing world through video gaming. So that’s something that very core to who I am. And I know, you know, I know, you probably feel the exact same way on that. And you know, that’s why I love this industry, because we can actually do that. So yeah,
Joakim Achren 56:07
yeah. Yeah, that’s good. One. Final question. What’s the way for entrepreneurs to get in touch with you and the folks at Coronavirus?
Jason Chapman 56:16
Well, you know, yoke is always a good first start. So if you got a good idea, you know, if you want to, you know, talk to him, he’s a good person to chat with chat, we chat frequently, but you can always just reach out to me on LinkedIn, pretty easy to find Jason Chapman on wave ventures, or just email me email@example.com those are, you know, we try to respond to every single person that reaches out to us, sometimes give us a little grace, we’re a little slow, depending on the week. But now, we want to hear from you, you know, if you’re touching this theme at all of UGC, or you know, job creation in different different parts of the world, like, talk to us, right, we love these things. And hopefully, you know, you know, yo came in my passion came through today, like, we love what we do, and love it. Right? Like, I love this industry. And so, you know, we want to support you and give the capital to the right partners. And so absolutely, but you know, I’m hoping you’ll Kim is going to become an investor alongside a lot of our companies, because he’s a smart guy. So you guys, whoever’s listening here would be lucky to have him as an angel investor. He’s the type of angel we always push push people to take money from so like he’s our guy.
Joakim Achren 57:24
Yeah. Thanks, Jason. Yeah. Oh, since some people your way as well.
Jason Chapman 57:29
I love it. I love it. I love it. I love it. Awesome. Well, our next our next chat, man, whatever, whatever it’s gonna be I’m sure we’ll think of some other crazy topics to talk about. Maybe like post COVID like, some kind of chat would be nice when that actually happens. Like, oh, man, maybe we’ll get to film that one in person. We’ll have beers together. It’ll be really great. We can just chat about how nice it is to see people in the flesh. Right?
Joakim Achren 57:55
Yeah. And what it does to the industry. Yeah, exactly.
Jason Chapman 58:00
What’s, what’s a different industry? I like that. Well, we’re gonna we’re gonna do that in like 12 months. We’ll do that one.
Joakim Achren 58:05
Yeah, hopefully not longer.
Jason Chapman 58:09
Hopefully. That’s awesome. Thanks so much for having me. I really appreciate it. Yeah, take care, man.