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[Happy]

News Article by ROB O'NEILL

http://www.stuff.co.nz/business/5005468/Big-guy-backs-SmallWorlds

Trade Me founder Sam Morgan is boosting his investment in New Zealand's largest social game company, Auckland-based SmallWorlds, pumping a further $2.5 million into its coffers to capitalise on the market for games played via social networks.

Morgan is a big name in New Zealand venture investment, but SmallWorlds has also attracted major global investors, including Disney's Steamboat Ventures, which owns about 7% of SmallWorlds, and cornerstone investor and technology entrepreneur Payman Pouladdej.

Why? Because gaming is the fastest-growing entertainment sector globally, and has already overtaken both the music and film industry in revenue.

SmallWorlds, which was launched in 2008 by entrepreneurs Darren Green and Mitch Olson, has nearly six million registered players. About 600,000 are active in any given month. That makes it a minnow compared with some of the giant online games, but it is already profitable and has links to web-based social networks such as Flickr and YouTube.

SmallWorlds employs around 35 people in Karangahape Rd and another 35 globally.

In the next stage of its development, it has three priorities – to extend into non-English speaking markets (Brazil is targeted for the third quarter of 2011); to extend the product line through small applications on Facebook and mobile platforms; and to market itself to bring in new users.

SmallWorlds is a virtual reality game that allows users to create their own spaces, outfits, missions and activities. It has two currencies, one that is earned through game experience and achievement and another that can be bought for real money.

Users pay cash for prestige virtual items such as large-screen TVs that actually play videos and, last week's special, a hot rod scooter, which costs $25.

However, Olson said such items often become highly prized within the game and appreciate in value. Suits sold back when the game first went live are now worth thousands, he said.

Players can play through their web browsers, making SmallWorlds different from earlier virtual reality games such as Second Life, which required a software download. They can also play through embedded applications in social platforms such as Facebook and in gaming portals, he said. It is also different in that "social" is a big part of the picture, as is self-expression and creativity.
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SmallWorlds has an active art community trading their works, for example.

"It's a big canvas for people to express themselves," he said, with many user-created spaces and missions.

There are also games within the game. Users can play virtual pool with friends they invite to play, hang out and watch videos and even play paintball. There's also a virtual newspaper within the world to keep users abreast of virtual news.

Development from now on will focus on "going where the users are and on the media they are using", Olson said.

Those users are both in their teens and in the age 30 to 45 demographics that dominate social gaming, he said.

New Zealand is in a perfect position to capitalise on the growth of social gaming, Olson said, with many world-class engineers and technologists in gaming.

Stephen Knightly, a director of gaming agency InGame, said the scale of the game industry here is likely to double over the next year.

SmallWorlds, which gains around 60,000 players a week, aims to be a $100m export earner by 2013. Games on social networks globally earned over $1.25 billion last year and are expected to reach $6.3b by 2015. More than 300 million people play games on Facebook alone each month.

Morgan says online businesses such as SmallWorlds are "hugely scalable" and can grow incredibly quickly, while maintaining high margins.

Our next wave of multimillion-dollar exporters may well be trading virtual goods, he said.

- Sunday Star Times

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[Happy]

To save you the Google:
Link to Disney's Steamboat Ventures.
http://steamboatvc.com/

[flamanar]

WO..........................   That's amazing! Thanks for the info, Happy!

[PrincessWendyBird]

This is pretty cool. I noticed "Playdom" on their portfolio. I knew they had acquired Playdom because that was Social City on FaceBook. I did notice the other night that the FB game "Gardens of Time" is also Disney. Looks like they are seeing profit in branching out. If only they made a FB game where you could create a Virtual Disney Park, etc. Like a mix of Frontierville and Social City with a Magic Kingdom feel. Anyway, great news for Small Worlds!

[Happy]

Would be nice.  Then we could all be "home again"--although we can not chat inside these Facebook games.

Regarding this story, SmallWorlds also made the tv news in NZ this weekend.  Here is the link.  http://www.3news.co.nz/NZ-company-aims-to-cash-in-on-social-gaming/tabid/418/articleID/211253/Default.aspx
Above link to story and video of news reporter interviewing Mitch now works. 

[Astro]

All very interesting.  Thank you for sharing, Happy.   

[Happy]

Thought I'd tack on this related article as it includes a couple additional tidbits.:

http://computerworld.co.nz/news.nsf/news/morgan-leads-25-funding-boost-for-auckland-social-gaming-firm