Many web3 game developers have struggled to get traction outside of crypto natives and play to earn gamers, but there is one company that has found some success at a heavy cost: Mythical Games. Amid the web3 gaming hype of 2021-22, the company secured over $300M in investments, approaching a $1B valuation.
Despite robust finances, Mythical Games faced challenges including user acquisition and an ongoing lawsuit against three of its former co-founders. The goal of the company is to build out a game ecosystem with web3 enabled games, a custom blockchain and token. While it has done all three, here we look at the setbacks and opportunities faced by a web3 game company that has the potential to grow, despite the bear market.
Blankos Block Party
Mythical Games’ first attempt at game development after creating its EVM compatible Mythos blockchain was PC title Blankos Block Party. The original design conceptualized by co-founder Jamie Jackson was inspired by blank vinyl character toys and the community of artists customizing them. As it shifted shape during development, the UGC (user-generated content) turned into small game-like levels. This helped the game develop its own aesthetic and IP which gathered interest from both Eastern and Western players.
Gameplay was a blend of racing and shooting that struggled to find an audience overlap between hardcore and social gamers. Originally it was intended to be a mobile game, but feedback from Apple and Google suggested it wouldn’t get through review. Compliance and working with mobile app stores was a major goal for Mythical Games, and also part of the reason it built its own blockchain technology. So Blankos Block Party was forced to launch on PC, initially through a download from its website.
The pivot to PC meant user acquisition became significantly more difficult. Eventually it would land on the Epic Games Store as the first live web3 game, though that store doesn’t have the huge presence Steam has. Mythical Games had ambitious goals for scaling player count into the tens of millions, but the cost of player acquisition, especially at a time when there was a gamer backlash against web3, meant that marketing spend had to halt so the company could focus on newer games.
While we can’t get the actual financial or engagement metrics due to the nature of its blockchain, CEO John Linden stated in our interview with him that it did monetize well with strong player lifetime value. Mythical Games also receives an unknown cut of secondary market transactions, though Linden stated it often accounted for 10%-15% of revenue.
UA costs and the web3 downturn of 2022 led to Mythical Games laying off 15% of its staff while canceling other projects to focus on more likely successes in 2023. The good news for Blankos Block Party is that the attitude around web3 games has changed enough on mobile for the company to begin working on a mobile port complete with changes based on the team’s learnings from its other games. The team has aspirations to continue to build on the IP as well.
Mythical Games was able to release two more games in spring 2023. American football game NFL Rivals saw the company work with the NFL and Players Association for official team and player licensing, and rather than focus purely on management, Mythical Games wanted to blend fantasy team-building with arcade-like simulation in the vein of NFL Blitz or NBA Jam.
After working closely with Apple and Google, Mythical Games was able to launch the game on mobile while keeping terms like blockchain and NFT out of the game, instead mentioning tradability and a marketplace. This tactic, reminiscent of Reddit's "digital collectible" NFTs, sidesteps a potential backlash. The game revolves around collecting player cards from real teams in blind booster packs to form Offensive, Defensive, and Special teams for matches. While cards can be earned in-game, Limited Edition and Blueprint cards are tradable as NFTs on Mythical’s Marketplace.
Mythical Games has not only been trying to adhere to mobile app store regulations, but has also influenced them. After Google sought developer feedback for cryptocurrency and NFT usage in apps, Mythical Games was mentioned in Google's mid-July 2023 policy update. By confining most blockchain activity to its website and making NFTs optional, in-game enhancements, Mythical Games provides a model for future web3 mobile games.
NFL Rivals offers straightforward gameplay, emphasizing offense. Defense is simulated using player stats and some randomness. Players select from short pass, long pass, or running plays. The game features a Campaign mode for PvE matches and a PvP mode where players compete against AI-controlled versions of other players’ teams for leaderboard positions.
In the Marketplace, card NFTs are priced in Mythos tokens, with a USD equivalent displayed. Players can buy the necessary tokens with a credit card, making the system more accessible to the average player. Mythical Games does, however, seem to breach the Google policies it influenced by selling random NFTs in player card packs, contravening an NFT loot box clause. The game also allows players to convert regular cards into NFTs by merging a Blueprint card with the same fully-upgraded player card, creating a Limited Edition NFT. This conversion method is likely to become a common workaround to the loot box policy as it happens after the value is known.
Mythical Games recently added NFT card purchases within NFL Rivals using a specific third IAP currency called Credits. This approach mirrors Diablo Immortal's Platinum currency system, and ensures Apple and Google get their 30% fee. To streamline trading and promote the web marketplace (avoiding the fee), in-app NFT browsing is absent. Instead, players are presented with three team-enhancing card options. These are most likely marked up to adjust for the fee as the money from credit purchases is used to buy Mythos tokens and pay the seller. Mythical has reportedly collaborated with Apple to ensure policy compliance and to show that web-based secondary market purchases actually boost in-app spending.
The game initially released postseason, so Mythical Games used this period to refine the gameplay and add some player draft-related play tied to real-world rookies. By the next NFL season, the game had a full launch, partnering with the Miami Dolphins for in-stadium promotions. While not a game-changer for the company, data.ai indicates steady growth with over 2M downloads and a revenue per download of $0.84 by mid-September, totaling around $1.5M from April to August. Additionally, Cryptoslam reports nearly $1M in volume for NFL Rivals NFTs. Interestingly, due to the NFL's US-centric audience, iOS revenue surpassed Android.
It’s difficult to predict the long-term viability of the game, but it’s not overly reliant on its web3 aspects at the moment. The actual gameplay is fairly shallow with a focus on improving player stats over gameplay skill, a reasonable strategy for the average mobile football fan. The intention is to tap into an already popular IP to leverage the desire for sports fans to collect and play with real NFL players and teams, which aligns well with the usage of NFTs here. The consistent annual sales of sports games can potentially give the game some long tail as it has for other web3 sports games like Sorare, but the ability to sustain business between seasons is always a concern.
Nitro Nation World Tour
Mythical Games quickly followed up NFL Rivals with Nitro Nation World Tour (NNWT), which soft launched in May and went global in September. NNWT was created in partnership with original Nitro Nation developer Creative Mobile Games, and features graphical upgrades over the original. The game is similar to other street racers like Need for Speed, Asphalt and CSR, and the core loop involves collecting and upgrading cars, a decent fit for NFTs. The game's economy mirrors NFL Rivals in most ways, with a few unique web3 elements.
NNWT offers both Standard and Limited Edition NFTs, with regular progression cars remaining non-NFTs. Instead of a blueprint system, NNWT introduces Spark Plugs and Limited Edition Modifiers. Combining four Spark Plugs of a specific rarity creates a random NFT car of that rarity, and adding a Limited Edition Modifier would make it a Limited Edition version. Both NFT Spark Plugs and cars can be gained from in-app blind boxes, seemingly violating Google's policy (again).
NNWT also introduces Founder’s Workshop NFTs, modeled after land NFTs but with social features. Owners can attach them to NNWT's guilds, known as Social Clubs, offering faster customization, upgrades, and repair options. Owners also profit from workshop spends and can loan or rent cars to players for a portion of the race winnings. While Founder’s Workshop NFTs are limited, the whitepaper leaves the option to introduce unlimited Standard Workshops if demand arises. The floor prices for Workshops are low, around $5 at the time of writing, and Cars are around $3.
NNWT's additional NFTs and repair taxes offer more profit potential than NFL Rivals, especially without seasonal downtime. The game also features over 200 car models from licensed brands like Subaru, Mitsubishi, Jaguar, Lotus, VW, and Shelby. However, without seasonal real-world hype and with plentiful existing competition, the game’s initial performance is poor. Data.ai reports only $8.3K revenue for August, with September not faring much better. The game has 135.0K downloads, with a revenue per download of just $0.11. Secondary market volume since January stands at just $17.8K. The game, still in its infancy, has many features labeled "coming soon."
Mythical Games has done a decent job of hitting its goals of building out its blockchain tech and releasing more web3 games than anyone else in the west. The strategy of working with contractor developers (Blankos Block Party), acqui-hiring (NFL Rivals), and forging partnerships (Nitro Nation World Tour), while remaining the “developer of record,” as Linden puts it, has successfully grown its ecosystem and portfolio.
The heavy downturn in web3 forced Mythical Games to focus on genres and IP that had a higher chance of success, but this is a positive in terms of helping transition players over. Trying to work closely with Apple, Google and, even Epic has at least partially paid off as Mythical published the first approved and promoted web3 games. Its effort to convince Apple that web3 secondary markets can actually increase the IAP transaction fees generated can also potentially benefit the acceptance of NFTs on mobile as a whole. While there are some oddities to the implementation of the loot boxes, many of the execution methods for web3 integration are laudable as strategies others can implement.
The big hurdle for Mythical Games is the same one facing all mobile developers in the post-IDFA world: user acquisition. There may come a point in the near future where secondary markets and a sense of ownership attracts players in itself, but for now, the focus will be on IP and gameplay. The benefit to game developers in terms of the potential resale royalty revenue stream seems to be a strong one for Mythical Games, at least.
Linden has mentioned some ambitious ideas for metaverse-like concepts “coming soon,” but the company may be trying to push forward too fast for the market to accommodate that. Mythical Games has at least shown some growth and revenue, in part due to the runway provided by investment funds, but it’s unclear how close the company is to true profitability. It has shown some shrewdness in trying to keep development costs low, but Nitro Nation World Tour, for example, may still be in the red for now. It’s also worth noting that the value of its Mythos Token has fallen from $1 to $0.30 since the NFL Rivals launch, a potential weakness in its ecosystem play. While Mythical Games has some potential to help push mobile web3 gaming forward, it's probably not the $1B unicorn it hoped to be anymore.
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