The Playfish Effect

It’s no accident that John Earner, a star social gaming developer, is behind Space Ape Games, an under-the-radar London start-up that is aiming to become “the Pixar of mobile gaming.” Earner is a member of the city’s Playfish mafia. Like the original team at PayPal, which famously went on to create the next generation of exciting companies in Silicon Valley, Playfish alumni are having a huge impact on London’s gaming sector.

Since U.S. gaming conglomerate Electronic Arts purchased London-based Playfish in 2009 in a deal worth up to $400 million, members of the team have gone on to either create or go to work for at least 20 London gaming start-ups, including new ones like Space Ape Games and Plumbee and high-growth gaming companies like and Mind Candy. (See the graphic for specifics.)

The effect on the city’s gaming sector is even greater when you factor in the number of Playfish alums now working for big companies, like Microsoft’s next-generation gaming studio in London.

Of the members of the Playfish founding team, only former CEO Kristian Segerstrale, now executive VP of EA Digital, is still working for Electronic Arts and he will be leaving in the next two weeks to work with start-ups, including those founded by Playfish alum. Some 118 of Playfish London’s former employees belong to a Facebook group, getting together regularly for curry dinners and pub meet-ups. The ties run deep. Many worked together before they came to Playfish and have now created new start-ups with other Playfish team mates.

The team’s career moves — and the decision most made to stay in London — are worth noting as there is often much handwringing when the city’s best companies are sold to U.S. acquirers. Such concerns fueled 10 Downing Street’s decision, at the urging of local venture capitalists, to initiate a change in stock market rules to try to persuade the UK’s most promising young companies to grow big and stay at home.

To be sure, many of Europe’s best start-ups either move to the U.S. or are purchased by American companies rather than remain at home and grow into billion-dollar businesses. This has a negative impact on Europe’s economy, since the best and the brightest entrepreneurs move out and the technologies that will underpin the future go elsewhere.

Europe does need to build tech companies the size of a Google or Facebook that remain headquartered here. But even when companies are sold off to U.S. firms the impact on the European ecosystem can be positive. Niklas Zennström, who famously sold Skype, first to eBay and then to Microsoft, stayed in London and created Atomico, a new venture capital firm. Skype alums have a “mafia” of their own. Saul Klein, for example, who formerly ran marketing at Skype, is now a partner at Index Ventures and is co-founder and chairman of Seedcamp, the London-based microseed investment fund and mentoring program.  Eileen Burbidge, who left Skype before the eBay acquisition, is a founding partner at Passion Capital, a London-based seed investment fund, and Skype alum Taavet Hinrikus is a co-founder of London-based currency exchange start-up Transferwise.

As important as Skype is to the European tech scene, EA, a three-decades- old American game maker, has done more than any other company to ensure the importance of London’s role in the global gaming industry.

London has long had strengths in gaming but when social gaming came along the momentum moved to the U.S. That is changing. Europe is — for the first time — producing venture-backed category leaders across the digital space, churning out gaming developers such as Mind Candy, the company behind the wildly popular Moshi Monsters game;, a London-based cross-platform social games company best known for its Bubble Witch Saga, one of the most popular games on Facebook; as well as Rovio and Supercell, both based in Finland; Germany’s Wooga; Russia’s ZeptoLab; and Turkey’s Peak Games.

“I have stayed in London because of the Playfish network and also because it is now easier to start a gaming company outside of San Francisco, a sentiment agreed by many, including Silicon Valley folks,” says Earner.

European gaming companies are proving more adept at monetizing the next generation of gaming than their U.S. rivals, by focusing on quality of game play and innovation. “Zynga’s first games were all about land grab, rather than quality,” says Kevin Comolli, a partner in the London office of Accel Partners. “Zynga definitely had a clever way of working the Facebook platform for virility but now we have moved on from there. The next frontier is coming back to what the UK and Europe are really good at: internalizing social features, combined with good game IP and good mobile skills.”

For instance, Supercell, a tablet-first company behind the wildly popular Hay Day and Clash of Clans, has gone from zero revenues to being IPO-ready in an extraordinarily short period of time. That company, too, has a Playfish connection. Segerstrale, Playfish’s former CEO, is also part of Initial Capital, the Playfish Founders’s seed fund, an investor in Supercell, and he introduced the founder to Accel, which ended up investing $12 million into the company in its Series A round.

The Silicon Valley Connection

The back story of the Playfish-Accel connection illustrates how the strengthening of ties between Silicon Valley and the UK benefits the ecosystem in London. Earner, a former U.S. naval officer, first got onto the radar of the Silicon Valley arm of Accel in 2008 when he was working for Sony Computer Entertainment America’s Playstation Network and Playstation Home. During the seven months he worked at that company Earner, who handled product management, business development, and content production, established a virtual goods pricing model and set prices, and brought aboard game publishing partners EA, Activision, and Ubi.

The Accel team in London introduced Earner to Playfish and he joined the company in 2008 in Silicon Valley as its first game producer. Accel also provided another crucial intro for Earner: Facebook. Accel, an investor in Facebook, arranged meetings for Earner with Mark Zuckerberg and key executives at the social media company. The Facebook connection ended up being crucial for Playfish. Earner is credited with figuring out how to monetize Playfish’s big simulation game, Pet Society, which at its peak was a number one game on the social network, and helped shepherd it once it was live. Earner went on to help launch Restaurant City, also a huge hit on Facebook. These two games inspired competing ones from Zynga and many other developers, and helped provide the revenue and traffic numbers that led to its eventual sale to EA.

Along the way Earner became a general manager/VP of Playfish London Studios, managing a studio of 90 people and establishing deep ties with London’s gaming community. After the acquisition, Earner helped EA to develop a variety of other titles on Facebook using existing intellectual property, including soccer management game FIFA Superstars and Sims Social.

Earner left Playfish in early 2012 to become an entrepreneur-in-residence at Accel Partners in London. After only a few months, he co-founded London-based Space Ape Games, along with Playfish alum Simon Hade and Toby Moore, the former CTO of Mind Candy. Seven other Playfish alums — Simon Hade, Ke Ren, Joe Raeburn, Pedro Rabinovitch, Lu Aye Oo, Stephen Courtney, and Adam Sullivan — have also joined the Space Ape Games team. The company has raised $2.6 million in venture capital. Its backers include Accel Partners.

“John has collected a super impressive team around him,” says Accel Partners’ Comolli. Although is too early to say whether the company will produce blockbuster hits, “the ingredients look really impressive,” he says.

Another of Space Ape Games’ backers is Connect Ventures, a London-based early-stage fund launched last January. One of the founding partners is Bill Earner (ex- Amadeus Partners), who also happens to be John Earner’s brother.

Space Ape Games has so far released one game: Call It: Football, an iOS game in which users compete with other players as they make predictions about what will happen in specific parts of American football games as those games are being played live. Call It: Football has a five-star rating in the iTunes store.

For the most part, though, Space Ape Games, which is just seven months old, is still in stealth mode. Its next title won’t be sports-related but Earner isn’t saying much more, other than that the company will focus exclusively on mobile and table games.

It’s not surprising that Space Ape Games is gunning for mobile and tablets. A Juniper Research study of the fast moving mobile and tablet games market (released in February) predicts that the rapid take-up of tablets, combined with the growing acceptance of in-game purchasing and virtual currencies, will result in an estimated $3.03 billion of sales in 2016, reaching over ten times the $301 million figure calculated for 2012.

“There is a revolution taking place again in gaming and it is on mobile,” says Earner, who says he wants the company to become the mobile equivalent of Pixar.

In Silicon Valley’s mercenary culture, teams rarely work together for more than two years, says Earner. The single biggest factor contributing to the success of Playfish and other European gaming companies is experienced teams who have worked together for a long time. Many members of Playfish’s original team had previously worked together at Macrospace and other companies. And after they left Playfish some of them continue to work together in new start-ups.

Supersolid is a case in point. Ken Fejer, Playfish’s former creative director, who Earner credits with being one of the “biggest brains” behind Pet Society, has launched the London-based start-up with two other Playfish alumni: Michelle Chuang and Tommy Chuang. The three previously worked together at Macrospace and GLU Mobile before joining Playfish.

Supersolid’s first game, called Super Penguin, launched in August last year. It has had 5.3 million downloads so far, across iOS and Android, and has a huge fan base in South Korea. So why base the company in London? “We have colleagues from Playfish and most of our contacts are here and it feels like London is really booming right now, so many gaming companies are starting up,” says Fejer.

Plumbee, a social casino gaming company launched by three former Playfish alums 18 months ago, is pioneering both social casino games and sports betting with real money on Facebook. The company, which has raised $3.8 million from Paris-based IdInvest, has launched its first social casino game, called Mirror Ball, on Facebook. The game, which will soon be available on Apple’s iOS platform, has 1.2 million active monthly users and is currently the ninth largest social casino game globally and the fifth largest in terms of revenue, says Plumbee co-founder and CEO Raf Keustermans. While the company does not disclose its revenues, he says they are “well over one million a month.”

Plumbee is literally spreading its bets. It has a 50% stake in Bonza Gaming, a London-based sports betting company that makes games that are played for real money. The company, which has launched a title called Bonza Slots, is the first game played for real money to be accepted on Facebook, ahead of established players like Betfair, William Hill and Ladbrokes, says Keustermans.

Other Playfish alums have opted to join established star gaming start-ups. For example, Catharina Lavers Mallet, an executive producer at Playfish London’s studio, is now helping build a London studio of 50 people. Like Earner, Mallet is American. And she doesn’t plan on leaving London, where she has lived since 2009. “The thing about Europe is that people tend to stay with their employers a little longer,” says Mallet. The tech scene in London is “large enough that you feel like there is movement without it being overwhelming, but small enough that you feel like you have a network.”

Working with Playfish was a special experience, she says. “I full out bawled at my own leaving do — not one of my prouder moments — but I think it says something about the strength of that team,” says Mallet. “We created something together that goes beyond the products; we have formed a community.”

Eric Sylvers contributed to this report.




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