New Legends Studios - Seed Deck 2014

Competitive Mobile Gamesthat are fun to watch, fun to play.

Notes‣ This is the “reading” deck used in the seed round of New Legends.‣ We used another version for meeting presentation, which had much less text and some

slides were removed / different.‣ I did add the Extra Slides part from the presentation version, which contains many

different slides used to show additional data potential investors may ask about.‣ We used this deck around Q3/Q4 2014 so there should be more accurate/up to date

data out there by now.‣ We used the term “watchable games” instead of “eSports” as many investors didn’t

know the term and understood it completely wrong initially.

‣ I got a lot of help from many people in the games & startup industry, and enjoyed manyof the free resources out there for entrepreneurs. Releasing this deck is a way of givingback a little. I hope it will help others in some way.

‣ If you want the powerpoint version or just found this deck helpful and want to get mecoffee in return contact me on twitter at @civaxo or check civax.net

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http://civax.net/

Veteran TeamOhad BarzilayCEO, Co FounderBackground: Mytopia GM (acquired by 888), later COO & CCO. Grew team to 50 in 3 studios. Deepmist Studios CEO, Beit Berl Academic Staff.

Ian MacLeanArt DirectorBackground: Award-winning illustrator and animator, Worked for Sony, Zynga, Google, Irem, Paizo, Universal, A Bit Lucky.

Eric SeufertHead of Marketing at WoogaBackground: Currently Head of Marketing at Wooga, author of Freemium Economics. Previously Digital Chocolate, Skype.

Eitan ReisinChief Product + Ops, Co FounderBackground: Head of Mytopia biggest studio & Game Designer, previously Game Client Team leader.

SagiHead of DevelopmentBackground: Mytopia‘s Game Technology Lead across all studios.

Ron KorenVP R&D at Novidea SoftwareBackground: Mytopia CTO and VP R&D. ZazmaVP R&D. Designed the team’s initial server architecture and DevOps.

Advisors

X.CEO at [undisclosed]Background: Angel Investor, Multiple times CEO, (remain private).

Investors

‣ All members have 4 to 13 years industry experience.

‣ All are hands on with engineering backgrounds.‣ Launched & operated games together for +3 years,

generating ~$1M monthly revenue.

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Market Size Opportunity

‣ Sharing & watching gameplay videos is huge phenomena - more spectators than cable TV networks.‣ Currently all top games streamed are PC/MMO games (competitive multiplayer games). ‣ Mobile is the perfect platform for streaming & watching – connected, has cameras, always with players.‣ Mobile Games is biggest growing sector in the game industry (CAGR: Tablet +47.6%, Phones: +18.8%) ‣ Making fun-to-watch mobile games taps into the huge opportunity to bridge the two sectors.‣ Key Technology enablers are now starting to release Mobile SDKs (Twitch, Everyplay, Kamcord)

2016E2016E Game Industry: $86.1 Billion 2016E

Mobile GamesPC/MMO Games

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Game Spectators > TV channels‣ Twitch.tv is a website where players stream live game sessions and watch videos of other players.‣ Has more viewers in prime time than MTV, MSNBC, E! and CNN.‣ Was acquired by Amazon for $970 Million on August 2014.‣ Recently released it’s streaming SDK for mobile devices.

565K495K

780K773K625K

Number of average prime time viewers

Source: New York Times, 27 August 2014 (http://turm.us/1qfyz4s) based on Nielsen, twitchapps.com 5

~$70 Million Monthly Revenue


Not Free-To-Play game


(connected to twitch Sept 2014)

Industry Players

Data based on Twitch most watched games

Top Titles on PC / MMO(that streams gameplay)

Titles on Mobile(doesn’t stream yet)

Titles on Mobile(that streams gameplay)

~$200 Million by EOY

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Forest Tribes: Rise of Heroes

Prototype Video Demo: http://turm.us/NLSdemo1

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http://turm.us/NLSdemo1

Forest Tribes: Rise of Heroes‣ Free-to-play, Mid-core, Cross platform (iOS +

Android)‣ Competitive Turn-based Strategy game with Battle

Cards mechanics – Clash of Clans meets Hearthstone

‣ Built to be fun to watch as well as to play: ‣ Simple basic rules, easy to pick up – hard to

master.‣ Designed to generate dramatic moments‣ Play sessions fit mobile gameplay‣ In-Game streaming and community system

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What makes a game watchable Impact on Performance‣ Competitive – Clear Winners / Losers ‣ Extremely High Engagement

‣ Simple Rules – easy to understand, yet allow depth ‣ Viral Acquisition – players stream events, shares, talk

‣ Skill is the biggest factor for winning, but luck can affect ‣ High Retention

‣ Unpredictable – anything can change until the end ‣ Develops Brand Loyalty

‣ Socially Inclusive – Encourage social interactions, events ‣ Works across genres (Midcore / Core genres)

‣ Foster Professional Players that fans learn to know and follow ‣ Becomes part of marketing strategy

‣ Allows creation of professional leagues and real world events ‣ Advantage over similar games / Clones

Fun-to-watch Games DNA

‣ Essentially, a fun to watch game (or sport) match is a sequence of dramatic moments.‣ Requires a specific approach to game design and integration of specialized game technology‣ Not every game is fun to watch (e.g. puzzle games, pure luck games, repeatable/grinding gameplay)‣ The virality and high retention of these games significantly lower the User Acquisition costs.‣ Forest Tribes is designed & developed to hit all these points, with it’s competitive turn based gameplay.

Why is this different than other games

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Production Timeline

Q22015

Q42015

Q12016

Q42016

Q12017

Q42014

Q12015

Q32015

Q22016

Q32016

Forest Tribes (Smartphones)

Forest Tribes: Rise of Heroes (Tablets: iOS + Android)

New Game

Preproduction

Production

Soft Launch

New Features

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Technology

*In-GameCommunity

SystemDB

Analytics

Game Client

Game Platform - Unity

Server 3 +

Game Server

Server 1

Server 2

DB Server 1

Mixpanel

Internal

DB Server 2

DB Server 3 +

Android Client

TabletsPhones

iOS Client

iPadsiPhones

Possible Future Clients

PC / Web / Consoles

Game Admin

Twitch.TV

YouTube

Others

Others

Technology‣ Cross Games Infrastructure: built in modules to allow usage in other games.‣ Unity Platform: Developing on Unity allows us to compile the games across all platforms.‣ In-Game Community System: Internal community management system is built to offer all

game related game forums, posts, videos and more to be available within the game. ‣ 3rd Party SDKs: Incorporating 3rd party SDKs allows using latest services from top providers

(Twitch, YouTube, Analytics services, Customer Support and more).‣ Administration Panel: Allows real-time management of all game players, assets and balancing.

In-Game Community (Internal mockup) Twitch feed of a streamed mobile game (actual, from Twitch)

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Financial Projection for FT:RoH

Quarterly Q4 2014

Q1 2015

Q2 2015

Q3 2015

Q4 2015

Q1 2016

Q2 2016

Q3 2016

Q4 2016

Q1 2017

Q2 2017

Q3 2017

Income - - $ 123,222 $ 398,894 $ 833,806 $ 1,504,714 $ 2,005,781 $ 2,866,711 $ 4,081,975 $ 5,607,011 $ 7,189,829 $ 8,154,687

$-

$1,000,000

$2,000,000

$3,000,000

$4,000,000

$5,000,000

$6,000,000

$7,000,000

$8,000,000

$9,000,000

Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017

Income by Quarter

‣ Assuming additional growth round of $2M at Q3, 2016

‣ Initial Gameplay Prototype – Q2, 2014 (done)‣ Raising First Round – Q3-4, 2014 (in progress)‣ Soft Launch – Q2 2015 (6 months dev)‣ Break even – Q4, 2015 (5 quarters from seed investment)

Financial Assumptions & Milestones

eCPI ARPDAU Stickiness

Soft Launch $1.5 $0.10 16%

Global Launch $2 $0.15 24%

12 Monthsavg, post global launch

$3.5 $0.35 36%

Milestones

Assumptions

Now Raising

Targets

Marketing36%

Salaries48%

Others16%

$1M

‣ Hire Key Employees during Q4, 2014 - Q1, 2015‣ Soft Launch in Q2 2015

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Join us to create New Legends

Ohad Barzilay, CEO

[email][Israeli mobile number]

[US mobile number]

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Extra Slides

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Mobile Games Worth Broadcasting

‣ Players sharing and watching gameplay videos is a huge recent phenomena, gaining more viewers than cable TV networks.

‣ These players gain fans, sponsors, compete in leagues and some become stars, generating millions for themselves and the game developers.

‣ Almost all of the games watched and streamed are free to play PC/MMO games.

‣ Mobile games is the fastest growing sector in the game industry yet have very few games worth streaming or that offer sharing video. This, while mobile is the perfect platform for streaming games and watching videos.

‣ We bring these two worlds together. We’re an experienced team developing competitive mobile games that are fun to watch as well as fun to play, and enable streaming and sharing of gameplay video from the mobile devices.

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Mobile Games: $28.9 Billion by 2016

Mobile games generated $16 Billion in revenue in 20131

Source: NewZoo 2013 Global Games Market Report1 Actual numbers, source: App Annie & IHS Digital Content Report 2013. Projected 2013 revenue was $12.2 Billion, which may indicate projected numbers are under-estimated.

June 18, 2014: Juniper Research projects $28.9 Billion revenue 2016 (not $23.9B), $20.9 Billion revenue EOY 2014.19

Twitch bigger than MTV, MSNBC, CNN

Spectators Games are already HUGE on PC, Consoles

Source: KPCB Mary Meeker’s 2014 Internet Trends Report. StatCounter, 5/14. 20

eSports Games - Past

Source: InMobi, Mobile gaming cross market analysis 2014 Q2 21

eSports Games - Future


New Genre of Video = Spectator Gaming

Players -> Players / Active Spectators


Fans Trump Audience

Alex Carloss (Head of Entertainment @ YouTube)

Source: KPCB Mary Meeker’s 2014 Internet Trends Report24

Tablet growing faster than PCs ever

Tablet units growing faster than PCs ever did, +52% 2013


Phablets growing faster than phones

Phones with 5+ inches screens are taking over, even at Apple


Tablet Users: Loads of growth ahead

@ 56% of Laptops / 28% of Smartphones / 8% of TVs


Games Dominates on Tablets

Source: Flurry Analytics, Sep 2012 28

Rise of Mid-Core and Core Games

High ratio of Mid-Core & Core players tend to be paying users.

Source: NewZoo 2013 Global Games Market Report29

Source: Kabam, Internal Research data presented CasualConnect USA (August 2013)* ages 18 to 65; among mobile gamers only

Audience: Population By Gamer Type*

21 135911 9

100

95

107

US Europe Asia

CoreMidcoreCasual

Core:FPS/RPG/Fighting/MMORPG/MOBA

Midcore:Action-adv/Puzzle RPG/BCG/ CCG/ Sports/Racing/Empire/ Tower Defense/ Movie-based/ World-building

Casual:Puzzle/Hidden Obj/Word/IQ/Board/ Casino/Farm/City/Restaurant/ Business Mgmt/ Platform/Pet/Educational/Party/ Music/Arcade/Fashion/ Drawing/Fishing

Source: Kabam, Internal Research data presented CasualConnect USA (August 2013)

Audience: Demographics

‣ Age Differences are minimal across geos and gamer segments‣ Sex differs across geos and gamer segments‣ EX: Significant difference between core and casual in US and

between core in US and Asia


Audience: Engagement

36% 36%

16% 15%19%

18% 17%

35%40%

24%

more time

Less time

Midcore Segment

Mid-Core Segment:‣ Smartphone/tablet mid-core

has the largest increase and the least decrease compared to other segments

‣ Smartphone/tablet above all other platforms

Free to Play and Communal Gameplay

Source: Digi-Capital Global Games Investment Review 2014 Q1

Free-to-play and communal gameplay changing sector dynamics

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Free to Play and Communal Gameplay

Free-to-play and communal gameplay changing sector dynamics

Source: Digi-Capital Global Games Investment Review 2014 Q1 34


Audience: Conversion Rates

‣ Mid-core shows the highest regional variability

41%36%

48%

8%

18%27%

6% 9%14%

US Europe Asia

Core Midcore Casual

Smartphone Users = Still lots of upside

@ 30% of 5.2B Mobile Phone User Base


Mobile Usage continues to rise rapidly

@ 25% of Total Web Usage vs. 14% Y/Y


Image + Video Sharing Rising Rapidly

Source: KPCB Mary Meeker’s 2014 Internet Trends Report. 38

Mobile – the growing sector in games

Source: NewZoo 2013 Global Games Market Report

Mobile – the growing sector in games

Source: App Lift / Newzoo infographic


Gender by Device Type

Source: 2013 NewZoo Data Explorer

Share of Mobile Game Payers


Game Revenue Per Store


Rise of Mid-Core & Core Games


Source: Digi-Capital Global Games Investment Review 2014 Q1 46

Several games played in parallel


Time of Gameplay


League of Legends Revenue

Source: InMobi, Mobile gaming cross market analysis 2014 Q2

2011 2012 2013 2014

$70MAverage monthlyrevenue in 2013

217%Growth in MAU - July2012 vs. July 2014

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Not only top 10 - Samurai Siege

‣ Generates ~$2 million monthly

‣ Top Grossing Ranks:‣ iPad -> Games: US: 67, UK: 45‣ iPhone -> Games: US: 153, UK: 149‣ Android -> Games: US: 105, UK: 125

New Legends Studios - Seed Deck 2014

Business

Transcript of New Legends Studios - Seed Deck 2014