Turkish Gaming’s Market Movers

Hi Everyone. Welcome back to another issue of Master the Meta. Last Sunday's most popular links included: VentureBeat's interview with Playtika CEO Robert Antokol, our newly released Premium report on Sandbox, and details surrounding Axie Infinity's new Builder's Program. With that, let's jump into Wednesday's issue.

Crypto Corner #10: Crabada, A Decentralized Play-And-Earn Idle Game on Avalanche

In this Metacast Crypto Corner episode, Ryan Foo and Tender join your host Nico to take a deep dive into Crabada, a fully decentralized Play-and-Earn Idle Game on the Avalanche network.

Set in an undersea world filled with fierce fighting Hermit-Crabs called Crabada. Players are invited to breed, lend, rent, and battle crabs represented by on-chain NFTs to earn cryptocurrencies with real value.

You can find us on Spotify, Apple Podcasts, Google Podcasts, our website, or anywhere else you listen to podcasts. Also, feel free to shoot us any questions here.

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#1: Gaming DAOs: A New Way of Coordinating Gaming Communities

Decentralized autonomous organizations (DAOs) started making waves in 2021, but their impact in gaming has thus far been overshadowed by the rise of NFTs and the advent of "play-to-earn" business models. In 2022 and beyond, DAOs will have a meaningful impact on the way gaming organizations operate, fundraise, build communities, and even develop new games.

In this piece, we will explore the fundamentals of DAOs, their appeal as an organizational structure, their current uses in the games industry, and their future outlook. Along the way, we’ll also explore some of the operational challenges that DAOs will need to overcome and dive into some case studies of the most prominent DAOs working in games today.

Key Takeaways:

DAOs had a big year in 2021, but their impacts on gaming have been overshadowed by the debates around “play-to-earn” (P2E) business models.
DAOs feature five unique differentiating factors when compared to the traditional organizational structures found in gaming today: tokenized ownership, decentralization by design, automation via smart contracts, increased transparency, and ease of capital formation.
Many DAOs are already operating in the games industry. These can be broadly categorized as either gaming guilds, incubators and accelerators, or game developers.
Game developer DAOs face greater operational challenges than other types of DAOs operating in the games industry, which has likely slowed their adoption at this early stage of web3 gaming.
Many opportunities to utilize DAOs within the games industry still remain unexplored. 2022 will see a major increase in interest among investors, industry professionals, and fans seeking to leverage the distinct capabilities of DAOs.

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#2: Turkish Gaming Startups Raise Hefty Funding Rounds

Turkey Spyke — *Source:* *Dream* & *Spyke*

Just two days apart, Spyke Games announced a $55 million seed round and Dream Games revealed it raised $255 million Series C. Both companies are based in Istanbul.

Spyke Games' $55 million seed round was entirely funded by Griffin Gaming Partners. Except that it’s one of the largest seed rounds in history, the raise itself is nothing out of the ordinary: Spyke boasts a senior team of Peak veterans. To name a few, the CEO (Rina Onur Sirinoglu), as well as the founding team's expertise in product (Barkin Basaran) and tech (Fuat Coşkun) come from Peak Games heritage. While the seed round itself was to be expected, the size of it is bound to raise some eyebrows. A fifty-five-million round would be an outsized seed round anywhere, let alone in Turkey, where a more typical high-profile seed round is still in single-digit millions.

The round may be pre-revenue, but it is not entirely pre-product. Spyke's first game, Royal Riches, offers a casual slot experience very reminiscent of Moon Active's behemoth game Coin Master. A fully playable version of Royal Riches has been out since September, but Spyke hasn't started scaling up its marketing yet. Presumably, Griffin and Spyke have high expectations for the game, and the seed round will empower Spyke's marketing war chest as it faces Moon Active head on. Perhaps the PR announcement isn’t the full story and there’s more than meets that eye of Spyke outside of Royal Riches.

Just one day after, Dream Games' $255 million Series C raise eclipsed the news of Spyke's seed round. We wrote about Dream Games last July when they raised their Series B. Since last summer, Dream has further grown Royal Match, now clocking an impressive $475 million forward-looking 12-month run-rate.

To quickly run through the key numbers (run rates from SensorTower):

Last July, the Series B valued Dream at $1 billion; Dream had a $290 million 12-month run rate.
Last week, the Series C values the company at a whopping 2.75 billion; Dream has a $475 million 12-month run rate.
In other words, the valuation of the company is up by 175%; the scale of Dream's business is up by 64%.
The $2.75 billion valuation implicates a 5.8x forward-looking gross bookings multiple.

The bigger you grow a singular product, the more difficult additional top line gains become. Thus, while Dream's previous rounds were all about Royal Match, the latest raise hints at investors betting on revenue growth from new games as well. The team that delivered Royal Match is certainly worth the trust. However, splitting the company’s razor-sharp focus from one blockbuster product into supporting a live game and building new is not a trivial challenge. Time will tell which genre will be the target of Dream’s next conquest—and when we shall see it.

Turkey has certainly become a hotbed of mobile free-to-play in the recent years, not least because of Peak. Everyone knows Dream Games by now, but companies such as Loop Games, Bigger Games, and most recently, Spyke, also share some of that invaluable Peak DNA.

We're all standing on the shoulders of giants, in some form or another. Clearly, some of the most fearsome giants of today in casual mobile games come from Istanbul. (Written by Miikka Ahonen)

📚 Content Worth Consuming

Infrastructure & The Future of a Decentralized Web (BITKRAFT): “In our view, the emergence of blockchain technology, a foundational layer of the Web3 tech stack, has started a seismic shift in the gaming industry. That said, there are 2.7 billion gamers in the world. Meanwhile, DappRadar calculated just over 1 million daily active blockchain game wallets in October, and popular blockchain game Axie Infinity reported 2.7 million DAUs in November. There are clearly barriers that must be overcome to realize mass adoption — let alone a large, real-time, shared, and persistent virtual environment, such as the “metaverse”. We cover these barriers in detail in our previous Insights piece, but they include high and volatile transaction fees, slow transaction speeds, and a complex user experience.” Link

Clash Mini — Contender or a Pretender? (DoF): “Clash Mini is one of the three Clash games Supercell announced in April of 2021. The first of the three to hit the soft launch was Clash Quest. You can describe it as Legend of Solgard (published by King) with a Clash IP and some minor metagame tweaks. As expected from Supercell, Clash Quest is a polished game. But quite frankly, the game felt underwhelming both from product position and gameplay experience. The second Clash game was Clash Mini, which entered soft launch around three months from writing this article. If you haven’t been playing and following Clash Mini off the jump, here are a few facts to catch you up to speed. The first two weeks' key metrics were quite positive. The strong golden cohort effect hints at a high interest from the core audience and a good early LTV curve. But beyond that point, Clash Mini sank in the charts. So at the moment, it seems that it hasn’t been able to keep players engaged (and paying) for a long time.” Link

Lessons on Designing Effective Virtual Game Economies (1kx): “For a virtual in-game economy to maintain economic equilibrium — the relative stability of its core currency and items — it must balance the rate of asset issuance with the rate of asset consumption/demand…Luckily, virtual economies have existed for decades and there are many precedents of failed experiments and hyperinflated games that we can learn from. We hope to introduce how previous virtual economies have deployed sinks, along with available data on the efficacy and popularity/reception of different strategies. We also comment on new balancing tools available to community & culture first p2e games.” Link

NYC Digital Games Industry 2021 Economic Impact Study (NYC Media & Entertainment): ”NYC is poised to become a leader in the video game space. The city is home to Take-Two Interactive, one of the leading video game publishers in the world. We are one of four cities (along with Los Angeles, Houston and San Francisco) that dominate the E-sports job market. And we are a hub for casual and hyper-casual games, which are great for passing the time waiting for the subway. We also host two of the largest gatherings: Games for Change for game creators and social innovators to drive real-world impact through games and immersive media, and Play NYC, the biggest multi-day game convention for developers to introduce new titles to the gaming community.” Link