Immutable is one of the leaders in the web3 gaming space, as well as one of Australia’s fastest-growing companies. The business has raised AUD$400 million dollars and was most recently valued at AUD$3.5 billion (about US$2.5 billion). The company was founded by brothers Robbie and James Ferguson in 2018 when it was called Fuel Games, and they developed and published the blockchain trading card game Gods Unchained. The company then rebranded as Immutable in 2019, added an NFT trading platform, an Ethereum Layer 2 solution and many other products. 

To get a sense of the ambitious plans Immutable has for moving web3 gaming forward, your host, Niko Vuori, sat down with Robbie Ferguson, one of the founders of Immutable, for an enlightening conversation. 

To learn more about Immutable, visit You can find Robbie Ferguson on LinkedIn.


We’d also like to thank Windwalk for making this episode possible! Windwalk builds digital communities and the technologies necessary to accelerate them through their flagship software, Harbor. To learn more, simply head to

This transcript is machine-generated, and we apologize for any errors.

Niko: Hello and welcome to the Naavik gaming podcast. I'm your host, Niko Vuori. We have a great episode for you today and a fantastic guest. We've done a lot of looking back at 2023 in our end of year episodes. So today we will be leaping into the new year with gusto and taking a forward look at the web3 gaming space with none other than one of the founders of immutable Robbie Ferguson. Immutable is one of the leaders in the Web3 space, and I think it might be Australia's fastest growing company. Robbie will correct me if I'm wrong on that later on. They raised about 400 million Aussie dollars in funding, and most recently were valued at 3. 5 billion, which is about two and a half billion in U.S. dollars.

Robbie founded the company with his brother, James, in 2018 when it was called Fuel Games, and they developed and published the trading card game, Gods Unchained, which I'm sure long time listeners will have heard about. If they follow the space and we actually talked about it quite a bit about two weeks ago in an episode, when we did an overview of the state of web three TCGs.

So if you're curious about web three TCGs, be sure to check that episode out, the company then rebranded as immutable in 2019 and added NFT trading among other products, which we're going to talk about in depth today and given their perch in the ecosystem, Immutable gets to see a lot of what's going on in the space.

And that's why I'm very excited to have Robbie on the show today, Robbie. Welcome to the pod.

Robbie: Awesome. Great to be here.

Niko: Fantastic. All right. With that out of the way, let's get right into it. So why don't we start with a bit of background on immutable? As I mentioned in the intro, you started out as game developers as is often the case when these things pivot into other things, and then you took a bit of a turn.

So why don’t you tell us the story of immutable.

Robbie: Of course. As a bit of background I'm a massive video gamer growing up, been playing games since I was a kid, had thousands of hours in RuneScape, in League of Legends, in a bunch of other MMOs so does my brother. And I guess we, we got obsessed with the idea of Real value in gaming actually pretty early on.

So I've been building startups with my brother for the last decade now, both originally software engineers. And the first startup we ever built was a betting application or platform for League of Legends, where you could wager on your own matches against your opponent. And we had this idea that if you're going to have skin in the game.

Players would be engaged and retained with statistically far higher certainty than without this, and it could be this new horizontal layer of engagement and eventually, games shut it down to approaching terms of service. But we were still obsessed with this idea of value inside of games.

And then we got into crypto in 2014 with Bitcoin. And we became completely obsessed with the theorem in 2015 because it was pretty clear that if you could write, early on, there was this application called eat the wrong and it was very basic and it was a basically gambling dice application where you could say that on a dice roll and it would probabilistically reward you with a small house edge.

And the reason we were obsessed was in 200 lines of code, someone had made redundant what the Australian government spends tens of billions of dollars doing every year, which is they go and heuristically test slot machines to see if they're paying out what they say they'll pay out between 88 and 92 cents on the dollar.

And they air gap all these machines, but they can't be broken or corrupt or updated the code later on. And then they did something that the government could never do, which they took the profit streams. And they gave it to every player who used the game. And this idea, I think, of cooperatively being able to own companies was the thing that we became.

Really interested in as a new way to grow companies by giving away a share of the pie in exchange for faster growth and also how sort of network effects over time for a lot of traditional modes could become things that were communally owned and value could be distributed more equitably. And so we started building training bots initially on plenty acts and then on decentralized exchanges.

And then we. Got into NFTs when the first ever NFT came out in 2017 called CryptoCon. And we saw these and said, this will be how gamers own in game items. To us, that was the most obvious category of mainstream adoption in game. Now it's taken a while to get there, but I think we're basically at the we're going to start to see tens of millions of users on board to Web3 Fire.

And we actually started by building the first ever on chain game. Which was called Etherbots. I think it came out in December 2017. And all the logic of this game was completely decentralized. It was very expensive to run. So I think we learned a lot early on around. There was demand for this.

I think it made, 2 million in revenue the first few months. It was almost impossible to build on Ethereum. And it was impossible to use or scale Ethereum. We were effectively building on punch cards of computers. It was that. rudimentary and the documentation was Apple. So we realized there was demand, but there was also this problem and someone needed to make a platform.

And actually our vision from day one was always to create a platform. We just knew until we could showcase to the world with a really strong game. Why this matters in the same way that steam really got to become this dominant platform for trading by creating counter strike go that we wouldn't be able to do a successful job.

Otherwise. And the second thing is, I think if you're building a platform, the first thing you should do is be your own customer. Otherwise you were not building something that is very abstracted away from customer needs. So we started by building Gods Unchained, which to me was the most obvious thematic fit for a web3 game.

You have Magic the Gathering cards, you have Yu Gi Oh cards, where hundreds of millions of dollars are spent every year on trades, right? The estimated secondary market cap of Magic cards is 10 to 20 billion dollars. And then you can have the convenience and the distribution of a digital card game like Hearthstone, which broke records and was a category defining game when it came out, I think in, what, like around 2010.

And We said why don't we merge these and create a card game? The other reason is we have raised a couple of million dollars from Coinbase's first ever venture check and from a few other funds, but that's not enough to make a triple A MMO. It is enough to make a really high quality trading card game.

So that's how we got started. I've got some chambers, really successful 15 million us revenue in the first year. I think was a prototypical game that a lot of other things have been built on. And that really allowed us to start focusing on building out this platform. And, immutable today has more than 250 games building on us.

We have 70 to 75 percent market share of all the three games in the space, roughly 300 people around the world. And, we expect more than half of these to go live this year with the launch period. We'll see.

Niko: Okay. Yeah. Yeah, I think Robbie, the point you made about you have to be your own first customer and dog food your own product.

I think that's just so true and it just resonates very deeply with me. There just aren't really name me one platform player who hasn't done that first, been their own first customer, done all the things wrong that they're gonna do, realize where the pain points are, and then actually solve the problem.

It's the same for Epic. It's the same for, as you said, steam. It's just. It's a kind of a universal truth. So I really do appreciate that you guys were very much one of the very first to go out there and try and build something again thematically trading card games make a lot of sense.

That's why we did an entire episode a couple of weeks ago covering the web three ecosystem there. And of course, gods and change was heavily mentioned there. We've touched on a lot there in the intro. And so I'm just curious to hear what are the other things that immutable is now involved in?

You've told us the journey of where you came from and where you are now. And now you have your finger in a lot of pies. You still obviously got the gods and chains on the gaming side. You've got immutable X, which is your Ethereum layer two, you've got NFT trading. What else do you have going on in this space?

Robbie: So I categorized the big buckets of immutable as we have the studio, which builds and publishes Web3 games. And that's led by Justin Hulog, who formerly read Riot Games Asia. And the reason we do that is A, we can have these successful prototypes, but B, so we know exactly how to help the games on our platform.

Every piece of IP we invest in, how do we do a successful long term economy design for Web3 assets? How do we have a successful tokenomics launch? How do we have a frictionless user experience gets shared with every other game on our platform? And I think that is one of the core reasons that we've been able to have the market share we've had.

Especially before a couple of years ago, we weren't nearly as well resourced as the other major blockchains who were typically competing with. And I think the reason we were able to compete toe to toe is everyone has come to gaming because they see. Clearly the next 100 million users to Web3 are coming through gaming.

This is going to make my blockchain the most used blockchain in the world. And this matters in terms of adoption and metrics. So let's start it. Let's fund it. We've been purely focused on Web3 gaming. It's the only category we want to touch. We said no to PFPs. We said no to DeFi. We said no to collectibles.

And I think that's meant the DNA of the company both at an intellectual property level, the way we understand things, but also at the product level is fundamentally optimized for gaming. The core part of the business is the immutable platform. And this is now very broad. So our goal is to be the one stop shop platform.

If you want to build a web free game, you shouldn't have to really know what blockchain you're using. You shouldn't have to know what even a blockchain is. You should be able to incredibly easy on board deposit funds. Purchase assets and experience the value proposition of web free gaming. Now with the launch of Immutable ZKADM, which is going into, mainnet early access slash beta end of this month.

And then full launch end of March with a bunch of games. We are able to have smart contract compatibility with CK price. So that's really exciting. And that's obviously a huge effort over the last year from us as we've been building out with the Polygon team. We also, though, have a bunch of other products.

Our global order book means that you have unified liquidity no matter what marketplace you trade on, which is one of the biggest problems in the space today because liquidity gets fragmented every single venue you trade on. It's also much better for marketplaces because they get access to far more listings that they can fill.

And take fees on, on that platform. We have enforceable royalties for every single originated asset on the immutable protocol. Which is guaranteed at the protocol layer, which for us is a very important philosophical component. If you can't guarantee royalties, I think you're breaking one of the main value propositions of trading.

Niko: By the way, I'm just going to jump in on that one. I think a hundred percent. I'm the idea that you. Wouldn't enforce royalties. I'm very much on your side in this debate. I know it's, there's a philosophical disagreement among some of the purists and non purists and that's fair.

You can make arguments for both sides, but 100 percent if you can't enforce royalties, like what is the point of a marketplace?

Robbie: There is no point. So thank you for this debate has been a lot of the people who say philosophically, we're taking this end really. Yeah. It's not a philosophical argument.

It's a, it's very difficult to do with a smart contract layer alone. Yeah. If you just try and enforce it, it's smart contract layer. People can typically write smart contracts, but it's just right around it. As you've seen with, blur or X, Y, two, it's a race to the bottom. And that's part of the reason why we think it's so important to enforce the protocol levels that everyone is in the same playing field.

buT I completely agree. I think it's an axiom of people being able to have successful monetization. Yeah. The third thing we have immutable checkout, which is. You can pay with any currency, with any funds on Ethel one or Ethel two, and the idea is just incredibly compliant, simple payment routing for anyone trying to pay for a game with a little passport with currently 2 million people who have signed up for that, which is our self custodial wallet product where you can onboard with email or IOS or Android, sorry, Gmail, and you want.

And the reason why this is so powerful is it's blending the user experience of, hey, literally just signing in with, say, Apple plus self custody. So we're not taking users assets on that front. So we have a very broad suite of products, but our vision is if you want to build a Web3 game and make it successful, or you want to play a Web3 game, we'll connect you or we'll build the products that you need to do and on the games front, our vision is. A barbell strategy, you should be able to build completely customized smart contracts. You can just copy and paste it from either one with middle CKVM or you can just build with apis and never have to touch smart contracts on the board. I think that's incredibly important because so many of the developers that are going to be onboarding over the next one to three years as these games go mainstream, aren't even going to know what a smart contract is, what the insurance bugs are.

I think we're going to. Prevent many of these people from successfully developing unless we make a Stripe like interface, we've got to build.

Niko: Yeah, I completely agree. I, I've been in the Web3 space for a number of years now and went through the euphoria of, 2020, 2021 into the 2022 and, it's, there was always a promise like, oh, it's so hard to build.

It's coming. It's coming. It's coming. Hadn't come. These tools that you're talking about, these tools that you're building, they weren't there and they're still not there. Quite frankly, I think across the board. So I'm curious to hear what is your view of the overall Web three gaming space right now?

It's had a lot of false starts and some made some promises that it hasn't Quite been able to keep at least not yet. So I'm just curious from your perspective, you oversee a lot of the ecosystem, what is your view of Web3 gaming as we enter 2024 and moving forward? Is there more pain to come or is it turning a corner?

Robbie: The number one question I get is why are there no mainstream Web3 games? And there's two answers to that. The first answer is up until six months ago, the infrastructure didn't even exist for these to go mainstream. There was no good way to abstract that from players. The user experience onboarding to MetaMask killed 99 percent of conversion for any end user.

And this is not a pain point against that. MetaMask and crypto wallets are a product designed for hardcore crypto users. If you're trying to onboard the incredibly competitive performance marketing target audience of, say, mobile or casual games. You need a product that is incredibly easy to onboard with.

And then people also forget that a lot of this existing infrastructure has already had hit content to help people jump the hurdle of onboarding the first time you sign up. To Apple's ecosystem, and you decided to pause your credit card, it's not a frictionless experience. You've got to do a bunch of things, but now that ecosystem exists, and so we're really getting over that S curve of bootstrapping things from scratch, and that's why we need hit content.

I think that is now in place. Immutable Passport is live. We have done a B tests and it converts, 4 to 600 percent more efficiently than standard wallets. We have full gas abstraction. We have mutable ZKVM, which is smart contract compatible, but also fully scalable. I think the info is now finally there.

The second question is content, and the reality is the vast majority of games were funded two to three years ago, and games take four to six years to build. So really, we're only starting to see these games launch now, and we track pretty much every game in our pipeline. We track the expected. Value of success, which we bucket into based on funding game design, track record, play testing, et cetera.

It's almost an internal venture team and we track when they're going live. And obviously you have to add on some delay typically to these games, but there will be 50 to a hundred high quality games that launched this year. If the 250. The average funding size is seven figures with these are all managed customers.

We're not even tracking those sort of indie self serve applications. These are all major games. Like one of the ones we, one of the last week, which we'll announce soon. I think more than 15 million us dollars in funding. They have a team of 120 full time people. That's the average profile of one of these games that we've been seeing.

And so really the problem is timelines and these games are now going live. I think the other reason is given the market the last two years, there was no real urgency for these games to ship. It's not as if they could have made a ton of money through primary sales or speculation or launching a token.

The rise in Web3 gaming fundable tokens has put a huge. Shift in urgency for the timelines that many of these games to ship. They're all trying to get tokens out there. They're all trying to get playtests and BDS and start to win the narrative because right now there's obviously this huge burgeoning narrative for web3

Niko: Yeah. Something you said, I actually use the exact same example. Which is the example of, Hey, if you're trying to set up your credit card for the first time on, on Apple pay or whatever, there's a ton of friction there, but there's also an incredible amount of value on the other side.

Waiting for you. And that's why people are prepared to do that. And I think that's exactly what we've been missing for the financial side of things, there has been value, right? So you set up your meta mask, you set up your Coinbase account, like there's money to be made, right? When there's money to be made, people are ready to jump through a bunch of hoops and do the hard work.

And then once it's done, right? You don't have to do that onboarding ever again. But with gaming, there just hasn't been that big, valuable hit game on the other side of all of this. Hoops that you got job through and that's in my opinion, very much the same vibe that you're giving off here, which is once.

That good content comes and there's a clear and obvious reason to do the hard work of getting your wallet set up or whatever. And of course, everybody's making it like you guys are making it easy and easier with time, more frictionless, like a strike like interface, which you also mentioned it will happen, right?

And so I'm still very bullish long term on web three sounds like you are, you have to be giving your position. So you've alluded to a couple of Big announcements. You mentioned Polygon already. So why don't we actually start with that? Getting to some of the other stuff that you're talking about, but all of these announcements I think are made and all of these deals are made, partnerships are made with the view of making web three gaming more accessible and more, easily onboarded.

For the mass market. So why don't we start with the Polygon side? I think that's an infrastructure type deal. What is all that about?

Robbie: End of 2022, we really had one major competitor to the space and gaming was effectively a two horse race. You had Polygon and immediable with roughly 35 percent market share each.

And I remember there was this report by I think it was Delphi Digital, which was analyzing the market share of the major blockchain by looking at the funding attributed to games building on them. And Immutable and Polygon had roughly a billion U. S. dollars each, which was two thirds of all sort of funding for games in the space.

And we were competing viciously. The amount of grants going to games was rising rapidly. We approached massively staffing up teams. And I remember Sunday popped in the call with me and said, at the end of the day, you guys aren't a scaling protocol and we're not a gaming platform.

So there's an opportunity for us to really simplify. The user and developer choice and to form a default platform for gaming by joining forces. And that's exactly what we did. So we built immutable ZKVN, which uses the Polygon Prover and the technology at the scaling level that they acquired three teams back in 2000 and 20 slash 21 in what I think was probably One of the more successful examples of M& A in the space.

And the second thing is we really joined forces on the go to market side. And since then we've seen our win rates and our market share jumped from 35 to roughly 70%, which is what we expected. So that's been fantastic. And more importantly, I simplified the choice for developers.

The number one comment we got from that was I was originally choosing between Polygon and Immutable. Now I don't have to decide. And I think that's incredibly important because there is so much energy in the space dedicated to what blockchain you're going to use, what platform, wallet, we really need game developers to be obsessed with just how do I make my game more successful, more fun, to use your experience better, rather than, you don't spend that much time agonizing over whether you use AWS or GCP in a Web2 game.

So that's been really successful where, they're a fantastic team to work with. And obviously we've continued this trend of. The strategic partnerships with merit circle slash being, which we announced roughly one month ago, which is the largest web three gaming down the space, building a ton of stuff on immutable.

And we're really excited to work with that team as well.

Niko: Fantastic. We’ll talk a bit more about that in a second, but I think one of the things that is underappreciated by people who are looking. From the outside in who have not had to work in web three and do all the plumbing. We had an episode right before the end of the year.

Game seven had done a state of gaming web three gaming report and we had them on to talk about it. I thought it was a fantastic report, by the way, go and check it out if you haven't already. And I forget the number now, but it was something like there are 700 different blockchains now. And most of them are dedicated.

With the, like they're dedicated to gaming. They're trying to say, Hey, we're the best blockchain for gaming. And that's just madness. That is if I'm choosing to develop a game say there are 700 unities out there, or there are 700 unreal engines, or there are 700 app stores to choose from between Apple and Google, that's madness.

Everybody can tell you that's madness. So I do think it's actually, in my opinion, it's a good thing that there's some consolidation happening. Obviously competition is always. Good for innovation, but at some point, rationality has to prevail and you can't have an ecosystem of 700 different blockchains. I think it shows the promise of the category, right?

Robbie: It does. It does. Yes. People realize how much product market fit and how big this is going to be. There's 150 billion spent every year on in game items. And if we can translate that into value, that is open. On an asset ecosystem, like an open blockchain, and then you can add on derivatives and secondary financial instruments.

The opportunity here is quite literally half a trillion or a trillion dollar financial market annually, because that's typically what in terms of. The value of secondary financial instruments built on top of primary spot volume.

Niko: Yeah, no, a hundred percent. Are you preaching to the choir there? Okay.

So you mentioned Merit Circle. I know them, them well the largest gaming Dow out there. I'm curious to hear what the thinking behind that deal is and what you guys are doing together.

Robbie: Again, this was a real opportunity for us to say Merit Circle and Immutable were competing in markets. We were both, going in and bidding up brands for games, etc.

At the end of the day, I think there's a huge opportunity for the leading gaming platform, which is Immutable, to partner with the largest Web3 gaming dair in the world, which is Merit Circle, and form joint infrastructure that makes it exceptionally easy for games to be successful. So they'll be building a ton of that infrastructure with us.

I have to pee. Just to simplify again, the choice for developers, and Merit Circle has, I think, 100 million cash treasury they have obviously an enormous native treasury they're a team that I think has been really phenomenally obsessed with gaming, and we've already seen. Of the games that we've been working with together, people are incredibly excited for what they're going to bring to the ecosystem.

So they're building publishing infrastructure, community infrastructure, marketplaces on top of immutable, and we'll be working a ton together on the go to market side. So again I think this is probably a much bigger deal than people initially, people who heard the Polygon announcement were like, oh great, interesting, another partnership, but there's many of these, and really that was actually a fundamental shift in terms of the topology of Web3 gaming.

Resolving the number of choices that game developers have to go to. I think this is the same thing.

Niko: Yeah, I get the merit circle treasury update email every month. And they have a lot of capital to deploy and they obviously serve a lot of gamers and bring a lot of player liquidity potentially

Robbie: I actually thought this was a really interesting partnership.

Niko: And to your point that maybe they're, outsiders looking in again or okay, it's a Dow. Like I thought Dow's were, for buying the constitution, circa 2019 or whatever, if you remember that the constitution Dow project but I actually think it's a bigger deal than maybe people give it credit for.

So yeah, I'm interested to see what you guys do together. Okay. A lot of great news. A lot of great announcements. All of them of course meant to move the web three space forward. And I think one of the biggest ones, biggest announcements that you've made, which I thought was really interesting is doing something with one of the largest legacy gaming companies.

I'm like legacy. I don't mean it. In a derogatory manner, in a, this is a big deal, big company Ubisoft. What are you guys doing together?

Robbie: So we are building a frictionless experience for the future of web3 gaming together. There'll be more details to be shared on that in the coming months.

But we've been really excited to be working with this team. I think they're actually deeply committed to the space.

Niko: They are. Yeah. Of all the big companies out there, I think, or certainly in the West, we're going to talk about Asia Pacific in a second. But yeah I'm really impressed by how committed they have been throughout.

The crypto winter as well. Not just in the good times, but also through the bad times. And yeah, I'm excited to see you guys doing stuff there. Sorry to interrupt, but I'm, I just wanna give them a shout out 'cause they really are doing great work.

Robbie: I I totally agree. So this was, a year in the works of negotiation and going back and forth and, us flying to France, et cetera.

But I'm really glad we got this over the line. There will be, a lot of things coming out around this and things you can use this year. So we're very excited for this partnership and what's going to bring the space

Niko: Fantastic. So yeah a lot of big announcements. And of course each of those is big in their own right.

But collectively we're hoping it's going to move web three gaming forward. But I do want to talk about adoption a little bit more here. We touched on this earlier a little bit. We, we need that big hit game to come out. We need those bets that were made two or three years ago to start.

Actually coming to market, we need some of this infrastructure that you guys are building and others are building to come online and becoming even more frictionless than they are now. But do you see there being some kind of seminal moment for Web3 gaming? How do we? How do we honestly get more gamers into Web3 games from where we are today?

 It's been the same group of people who've been hanging out in Web3 for a while now. We haven't really seen the numbers go up. It seems like there's not a lot of curiosity on the outside. Looking in and so I just want to get your perspective on how do we get more gamers into these web through games short of like obviously hit games.

That's a that's an obvious one, but I do think there are other things that we could be doing to bring more gamers into the ecosystem.

Robbie: I don't think there's an answer outside of get more games and I've said the same boring answer for the last three years. But I think it's, you have to build games that are invisible to end players, that Web3 is even a component, certainly at least until they're reasonably engaged.

And then you have to deliver a value proposition of them being able to trade and sell for real value, things that they otherwise couldn't. And I think the first time you have a game with 10 million players, where a reasonable chunk of those are converting, the first even one tenth of Counter Strike go, which starts 15 billion in annual GMB.

Of trading skins, I think it's the moment you have this inflection point where you've proven the category every single time you've had a major successful game, which has been millions or hundreds of thousands of players in the space so far, you've had this inflection point of investment, et cetera, even the last three months, we've seen investments and velocity of deals done probably five X.

It is pretty clear that the entire space is waiting for these hits. Now I think the privileged position we're in is we get to see everything building. We know there is more than 100 high quality games going live on Immutable alone. In 2024 we feel very quietly confident there's going to be multiple hits this year.

I think with, a million players, I think on a monthly basis would be my kind of minimum definition of a hit. And I think we'll see things hitting and exceeding that.

Niko: Some confident predictions. I like it. I like it. Not many of our guests are quite as confident as you are. But again, you do have a unique position in the ecosystem where you do get to see all these.

 You heard it here. Listen, it was like, that's a big number more than 100 games. You said more than 100 high quality games are coming to market in 2024. Did I hear that right? Yeah.

Robbie: We've got roughly, 250 building on the platform. And just to give you an example of the pace, we onboarded 27 games in December in the last 10 days have already onboarded another nine.

So the pace at which we are onboarding these games is exponentially accelerating at the moment. So we're seeing more and more things and these are all optimized for their credible games. They have high levels of funding and they're also launching this year.

Niko: Yeah. Wow. Okay. Listeners, that's that is big news.

I think it sounds like 2024 could really be a inflection point. Next brings me nicely to my next question, which is what about web3?

Robbie: I will. I will caveat that there's going to be a very high failure rate. Gaming already is entirely hit driven. There's going to be 90 percent of these games.

Which ultimately don't succeed. You only really need one the entire space to take off.

Niko: Yeah no, absolutely. I, of course, games is totally hits driven and a game that looks and feels good in, in soft launch may not work for any number of reasons. And we see that all the time in any gaming, whether it be web three or otherwise.

So no, of course that goes with the same but a hundred high quality games are in development. I think that's the key point here. Like a lot of the early games that came to market and have been. In market now in web three weren't high quality games, they were crypto enthusiasts who thought they could become game designers overnight and, yeah, exactly.

Robbie: Yeah, so no, I think that's there's far more than 100. That's just what we're confident will be shipping this year based on our existing pipeline. So not even including games where

Niko: we're about to import. Got it. Got it. Okay. So yeah, again, my next question very nicely dovetails into this conversation, which is what do we need to see for web three investment to rebound, VCs to get really excited again.

I feel like basically what I've been seeing and hearing from the VCs I talked to, they're all sitting and waiting for that hit game to come out. And that's the catalyst that they're waiting for as well. Is that the right read? Do we expect investors not to really get involved again until there's a A really big reason, a big financial return.

Robbie: I would say Web3 gaming investment is already back. I don't think it's necessarily the peaks of what you saw in 2021, but we've already seen the velocity of deal making four or five X over the last three months. And that's because gaming tokens are doing incredibly well right now, even with games being in the early stages.

So there's not obviously a growth investing market. That typically isn't a growth investing market for games because games either are profitable or not, they don't typically need to raise a lot of capital beyond say series A, but they, we are seeing a lot of early stage deals get done. So I think you'll pull gasoline on this flame as soon as you have hits, but right now there is, I think it's one of the best times to be building and raising a web 3 game if you're trying to, we're seeing deals get done in.

A week that struggled to raise all three months prior and we think that's pretty exciting.

Niko: Yeah that's great to hear. Yeah there's some green shoots showing, for sure. I think so as well in gaming in general as well, not just web for web three.

Okay. One of the things I keep hearing from guests on the show is how much more forward thinking Asia Pacific. Tends to be on Web three. And I personally don't have terribly good exposure to that region or to what's being built over there. So I was like to ask our guests who are experts in the area and have obviously, you're in Sydney, you're in the Asia Pacific region.

And obviously you get to see a lot of probably Asian developers as well. What are they doing differently, both from a regulatory framework perspective, but also from an encouraging innovation perspective in Asia Pacific compared to the US or Europe?

Robbie: The biggest thing is probably REC especially around launching of tokens.

I think there's a massive chilling effect if you're a US domiciled entity trying to launch tokens at the moment. The second thing I would say is from a cultural perspective, and I don't necessarily have the root cause of this apart from Japan and Korea have actually always been the vanguard of shifts in gaming.

You had the first gacha games emerge out of Japan, you had Korea really leading the charge into free to play, and I think they view this prisoner's dilemma, or this innovator's dilemma, of who should move first to switch the model to an open economy, or Who will be able to experiment successfully disrupt the incumbents as something they can win, rather than hedged strategies like the West, where they'll say we're very happy to buy, as many of the largest games companies in the world, all the responses are, we're happy to, play around a bit, but ultimately, we're just going to buy the winners and we're just going to buy away into the space once it's noticed, because that's, they're happy to pay, right?

These are multi hundred billion dollar companies. I think in Asia, in Japan, in Korea in particular, you have a risk appetite that's much higher and you also have, and this is very common amongst Korean and Japanese developers, a true obsession with delivering more value to players. And a lot of these people are just sold that you give players more value when they can actually own assets which I think is phenomenal and obviously the best form of motivation.

The third thing I would say is. The gamers themselves are used to paying for power and games. They're used to having more financialized assets and economies. And so I think it's a much stronger negative reception from the audience there than it is in the West where you have a lot of discourse around free to play around exploitation of gamers and really a resentment of any new form of monetization.

And so the playbook there is you have to be much more cautious around branding, but to really. Make sure you're delivering value from day one in a way that's incredibly obvious. And you probably also have to make the Web3 site as invisible as possible. Whereas in Azure, you can almost be talking about NFTs as a feature or a part of your game.

So I think those are my three insights. Obviously, we're really excited to be based here. We're even seeing a lot of games being built out of China at the moment. One of our largest games is built out of there. And with 50 million of funding and MMO coming out later this year there's a ton of games which are being developed in China that being published globally because it's not actually legal to

Niko: publish a game to a domestic audience.

Robbie: So there's this interesting sort of uh, global publishing strategy.

Niko: That's interesting. Interesting. Yeah, I think there's a really interesting insights there. Yeah it's always been the case, free to play mobile was is a great example where mostly the, especially early on when, people were still figuring things out.

There was still a land grab and a gold rush going on. It was Always the case when I was at Zynga, during the early days of mobile, that we would look to the Asian markets to see what interesting features were being launched and released. Obviously we couldn't understand the games because, the language barrier, but we could look at the mechanics and we could reverse engineer as product managers, what they were.

Doing and then implement some version of that into our own games. And I think that's always been true. I think there's just always been a lot of really interesting innovation. Especially around monetization. I think you're exactly right there in the Asian markets compared to the U S and the European markets.

 Is that, is it your view then that I hate to use the term Western but not non Asia Pacific developers should be looking to. Asia right now at some of the games that are launching for inspiration. Do you think they're going to be more successful than some of these other games that we're talking about?

Robbie: Not necessarily. I think there's certainly games with Western audiences that are going to get it right. They'll probably just be different genres. You'll probably see. A lot more mobile and casual games in Asia Pacific, a lot more, gacha driven economies and MMOs, which are incredibly popular there.

You'll probably see more FPSs perhaps more trading card games things that, Western audiences are more used to and also a lot more desktop based titles in the West. So look, I think Both will be successful, but I think that from a branding perspective, it is probably easier for Asia Pacific to be shipping right now.

Gaming is a global business. So most of these people, when they're targeting distribution, they're not You would not exclude the U. S., you would not exclude Canada and vice versa, if you're in the West, you're not just publishing to the U. S. or Canada, you're also selecting Japan and Korea and these incredibly high ARPU countries.

Yeah, I think it's probably more around the genre of games that are going to be popular and their distribution strategy, but ultimately everyone will plan to publish locally.

Niko: Yeah. Okay. And I'm glad you mentioned the word distribution because that was my next question anyway here. So we all know as game developers that distribution, and by distribution, I mean getting the game into the hand of the target gamer, right?

That is my definition of distribution here. That's really hard in games. It's very expensive. UA has gotten, obviously ridiculously expensive over the years. Only the very biggest, most successful games can afford to pay. The CPIs that are required these days on mobile and good luck getting discovered on steam.

Even though it's easy, relatively easy to publish there. So I'm curious to hear your thoughts on distribution for web three games specifically, where is it going to be the traditional channels that we always see? Is there going to be a whole new. Performance marketing field that's going to, ad tech and gaming are always the two first things that show up on any new platform or any new technology.

And so blockchain, I don't expect to be any different. Gaming, of course, is the one that we're all talking about. And then ad tech will follow performance. Marketing will follow. What do you see having to be done differently?

Robbie: In web three distribution and marketing compared to more traditional channels that we know about the fundamental laws of performance marketing won't change, which is your customer acquisition cost has to be less than your the CLP you made from that customer.

And That has been impeded by poor user onboarding, which, if you're killing 90 percent of your users converting, you're making it 10 times more expensive for you to acquire customers. Now, people are competing at the margins in performance marketing for gaming. You have incredibly competitive ad spend and audience spent and This is making it impossible for people to compete on that basis.

So I think that's just fundamental that has to be fixed and that is getting fixed. But I think the more interesting question is what unique advantages does Web3 provide to Web3 games that allow them to compete more efficiently? And I think the answer here is probably two things. One is our thesis on when a gamer is spending on assets, they can later sell, they're going to be retained better because they've seen the game and their offer is going to be way higher.

And if that thesis holds true, it's going to make it much easier for people to justify the spent. But I think the most interesting thing is the killer value proposition of crypto so far has been proven with just ERC 20 tokens as capital formation and incentive formation. And. We are very obsessed with this idea of if you can create an asset is worth a lot of value, and then you can give that asset away in order for people to join your ecosystem, almost as your performance marketing budget, we have an incredible competitive advantage where you can be sharing the future value and the future economy ownership of your game with players in exchange for bootstrapping growth.

And I think that was Why we came to the space in the first place is this idea of being able to take whole chunks of company value, give it away, efficient programmatic means, and everything has to be measured with return on token spend. This is not some magical, hey, let's do an airdrop and we suddenly have an audience.

But if you can get that right, then. You have this enormous budget that you can be using to drive acquisition of audiences faster. And I think that's what the killer differential is going to be.

Niko: That's interesting. So I'm gonna play devil's advocate here for a second. If every game has their own token and every game in web three has to the state generally had a token.

 Wouldn't that dilute the value of any one given token? Massively actually infinity was so successful early on is because they were the only game in town pardon the pun with a token that they were giving away and then people were legitimately making money off that and of course that will then cause it to rise in value and in the end of course we all saw that wasn't sustainable i mean it still has value sure but it wasn't sustainable at the levels that it was.

And so I'm just curious to hear your thoughts on what's different this time around versus, early Axia days, which of course kicked off the original boom in, in web three gaming in particular what is different this time around? Why do you see these tokens being able to hold value at scale across an entire ecosystem?

Robbie: I think the difference is. First off, many of these tokens will fail. Many of these games will fail, and that's okay. It's just they're sharing value in exchange for players to join, and that means they have this budget. You still need to be able to have a game that is sufficiently retentive, sufficiently good, but it means that the winners can win harder and win faster without having to raise tens of millions of dollars to pay for performance marketing.

Replace an obsolete. A lot of the Google spend Facebook ad spend where really it's just an intermediary other just sharing direct value and audiences. And the second thing is that the game quality there's games which unless your game is willing to be played and to be successful as a web through game, it's not going to be successful as a web through game.

So all of this is augmenting and ways of making the economy bigger, making it more interesting, sharing value more effectively. I just think of for these things, it is. Frequent flyer points on steroids, where you can create incredible loyalty systems and give away value programmatically, incredibly efficiently, more than any previous system in history, but there's nothing new under the sun.

It's just a way of sharing value in a way that has to be measured. Eventually, this will get arbitraged out and the most successful games will be able to do it faster. It's the more efficient model than I think the current iSpend model.

Niko: Okay. I'm curious to hear what's on the immutable roadmap for 2024.

Obviously, you've made a bunch of these announcements. Most of this happened towards the end of last year, 2023, and obviously you're going to be working on those in 2024. But what are the most exciting initiatives in your mind for what's on the immutable roadmap?

Robbie: So I think 2024 will be by far our biggest year yet.

We obviously have immutable ZKVM launching which will be. The end game scaling products for game developers to build. And we have I think more than 110 games out of our pipe committed to launching on the windows league KVM, which is incredibly exciting. We have a ton coming out on gaming partnerships.

As always, we'll be able to share more soon. A lot coming out on the tokenomic side as well. Yeah, I can't share anything too much yet, but stay tuned over the next few months as we, we roll things out. And then really the plan is just to continuously iterate our products and continue to expand and help games get live.

I think that the core thing is how do we get Passport as frictionless as possible. How do we make the marketplace user experience as good as possible that the marketplace is building on our ecosystem? How do we make the success of people launching tokens and ERC 20s as successful as possible on the ecosystem?

So really just fully obsessed on we've got this pipeline of games. Let's make them as successful as possible in 2024.

Niko: Fantastic. All right. That's great to hear. And really, fingers crossed and I'm rooting for you for the entire ecosystem. I've been a big believer in Web three for a long time, and it's just like I said at the start, it's had a lot of false starts and some broken promises along the way.

But I feel like maybe we're at that breaking point now where, we get that Finish line insight and actually get over it with one or more great games that are, they're actually hits. Okay. So final question for you. I know we're coming up to time here. And this is a new question for 2024 inspired by, if anybody listens to Ezra Klein New York times podcast.

He always asks his guests three books. That they're reading that they would recommend to others. And so given this as a gaming podcast, I would love to know what all of our guests are playing and what they'd recommend. Robbie, what are the three games that you're most excited by at the moment or playing yourself?

Robbie: I would say first off, Olivia what did I love? UD Marina I think it's one of the best games I've played in the space. I'm actually a big auto develop fan of TFT. I think this is going to be enormous this year. And that team is incredible. And I'll do one non-web three game.

I played quite a bit of Boulder's Gate, oh. Nice.

Niko: That's on my list actually. I haven't got to that yet. Haven't had the time. Yeah. But nice.

Robbie: Fantastic game. Fantastic game. Great. That's good to know. Yeah very, I was very impressed by how they wove the D& D role mechanics into something that feels seamless.

And then the final thing I would say is Guild of Guardians is going to be a monster. This is coming out in a couple of months on full launch. We just shipped it in and had it up for testing at a very high ARPU spend audience. And the early retention stats on this day one of, I think 67 percent and a day seven of 46 percent from memory.

And this is the old world class now, there's some discounting of three based on golden cohort, but this is over a thousand people. I think this is going to be a enormous hit this year. We're really excited about the clients.

Niko: Fantastic. Good luck. Good luck with that. And good luck with all your other initiatives as well.

So that's a great place to end. So Robbie want to say thank you so much for coming on the pod today. It was an absolute pleasure and welcome back anytime. If you have any other exciting news to share, we'd love to have you on the show. And a big thank you to all of our listeners. We'll be back next week with more interviews, more insights, and more analysis from the weird and wonderful world of web three and the metaverse.

So until next time, friends stay crypto curious and feel free to send questions, guest recommendations, and comments to me. My email is [email protected].

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