When Founder and Managing Director Reza Razali started Terato Tech four years ago, the company consisted of him and his brother. During these four years, they have grown to a team of thirty-one. They are now able to maintain a positive cash flow and have received many awards for their accomplishments as a company which develops mobile applications, focusing mainly on games development and daily basis software. Reza describes the company as starting out building enterprise mobile apps for clients, serving both domestic and international markets. From there, they grew into building their own IPs. He says, “Our experience of working with clients and game publishers enabled us to grow quickly.”
He has faced many challenges, but one that stands out most to Reza is when a well-known publisher dropped one of their games only a few months after they had signed the contract. It was still necessary for them to continue servicing that IP, but the company and the team persevered. Fortunately, they had healthy revenues from other parts of the business with which they could continue to fund their IP development.
Discoverability and Fundraising
As for the greatest challenges in the game industry, Reza believes it is discoverability and fundraising. The majority of companies in the area find it necessary to supplement their revenues from IP development with servicing work. It is difficult to raise sufficient funds, and fundraising too early leaves a company vulnerable to a low valuation. He tells us, “I have met various game development companies which gave up 50 percent of the company for less than $10,000 US.” He insists that discoverability is also a problem unless the company has an adequate user acquisition budget or the backing of a well-known publisher. At Terato Tech, Reza works to mitigate these challenges with publishers, partnering, and funding user acquisition. They work with numerous publishers and have successfully launched games in this way. They have allocated adequate funds for their user acquisition activities. And finally, they have partnered with companies such as DeNA which assisted them in producing their next IPs.
Reza emphasizes the need for the industry as a whole to find ways to work with these challenges. He sees Casual Connect Asia as a great initiative, allowing developers within SouthEast Asia to connect where there was previously no similar opportunity. He points out that there is a need for more regional platforms for regional developers to connect. Rather than the challenges, Reza sees tremendous opportunities in Asia. Since SouthEast Asia is home to 550 million people, it is a huge market for game companies. There are now many up-and-coming game developers and exciting IPs coming out of the region, which is way Reza is excited about Terato Tech’s new development, a game development accelerator based out of Malaysia. This accelerator is designed to assist game development companies in South East Asia with accelerating and launching games globally.
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