Fool's gold

The rise and fall of mobile content companies

and the future ahead

@benjaminjoffe  |  CEO,  Plus  Eight  Star  BuzzCity  Developer  Garage  |  Singapore,  2010.11  

@benjaminjoffe  

4  years   1  year   5  years  

•  CEO,  Plus  Eight  Star  |  www.plus8star.com  – Best  prac2ces  from  Asia’s  digital  space  – Research,  Strategy  &  “Innova2on  Arbitrage”  

•  Speaker    100+  talks  in  16  countries  

•  Advisor  

•  Investor  in  Asia-­‐based  global  companies  

Angel  Investor,  Advisor,  Keynote  Speaker  

Mobile  Monday  Beijing  

4  years  37  events  

130  speakers  3,000  par2cipants  

For-­‐Side.com  (Japan)  

For-­‐Side  Story  

•  Market  cap  was  over  US$2B  – Acquisi2ons  worldwide  – Plunged  

•  Today:  US$110  million  (2010.11.24)  

•  From  ring  tones  to…  e-­‐books?  

Tapulous  

•  2009.12        $1M/month  

•  2010.10        bought  by  Disney  (US$35M?)  

•  Downloaded      35  million  2mes  

•  Revenue  2010    $15  million?  

Can  you  build  one  today?  

•  Early  entry  (before  iPhone  SDK)  

•  Bought  content  from  developer  

•  Concept  copy  from  DDR  

•  What  next?  

ngmoco:)  

•  “Next  Genera2on  Mobile  Company”  –  12  million  users  –  50  million  downloads  

•  Funding  ~US$45M  

•  Bought  by  DeNA  US$300  million  (+  100M?)  

•  Revenue?  

Deal!  

•  KPCB  Holdings  (32.72%)              $98M  •  Ins2tu2onal  Venture  Partners  (25.31%)  $76M  •  Norwest  Venture  Partners  (13.46%)      $40M  •  Neil  Young  (9.52%)                $28M  •  Bob  Stevenson  (9.52%)              $28M  •  Google  Ventures  (3.65%)              $11M  •  Maples  Investments  (1.81%)          $5.4M  

High  Produc2on  Value  

Who  buys  today?  

•  Japan    DeNA,  GREE:  x100M  in  the  bank  

•  Korea    Maybe  Nexon,  NC  Soo,  NHN?  

•  China    Tencent?  Others?  

•  US      Disney  

•  Others?  

Issues  with  the  app  economy  

•  User  acquisi2on:  Media  /  App  Stores?  

•  Virality  &  Mobile  silos  

•  Reach  –  60  million  iPhones  –  X  million  Android  phones  (app  store  fragmenta2on)  –  7+  million  iPads  by  end  2010,  30+  million  in  2011?  – How  about  low-­‐end  phones?  

•  Defensibility:  IP  +  Game  mechanics?  

Fools’  Gold?  

•  Global  developers  on  par  with  Silicon  Valley  

•  Race  to  the  borom  

•  Copycats  

•  Building  sustainable  cash  flow  

GREE  (Japan)  

GREE  

•  Market  cap:  US$2.9  billion  (2010.11.24)  

•  From  web  +  ad-­‐based  SNS  to  mobile  +  gaming  

•  Ad  push  

•  Revenue  2010:  US$400M+  – 60%  profit  margin  

DeNA  /  GREE  offering  

Celsys  

•  Mobile  Comics  

•  US$500M  /  year  market  

•  Leading  solu2on  provider  

•  IPO  Nov  4,  2010  

•  Revenue  US$32M  (E),  20%  profit  

Zappalas  

•  Mobile  fortune  telling?  

•  Subscrip2on  +  new  currency,  games  –  2.2M  paying  subs.    –  285  staff  

•  US$34M    (May-­‐July  2010)  –  28%  margin  – Over  US$100M  in  2010  (E)  

What  to  do?  

•  Distribu2on  

•  Service  vs.  Product  – Business  model  – Sustainable  business  

•  Dealing  with  “fast  followers”  

Ques2ons?  

More  about  “Innova2on  Arbitrage”  

Thanks!  

www.plus8star.com  

benjamin@plus8star.com    

benjaminjoffe  

hrp://twirer.com/benjaminjoffe    

www.linkedin.com/in/benjaminjoffe    

www.slideshare.net/plus8star    

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