Jakob Lykkegaard, Co-Founder of Pocket PlayLab, remembers his teacher telling him that entrepreneur or CEO was not a valid dream job. Fortunately for mobile gamers, he was not convinced. When he started looking for opportunities, he quickly became enthralled with the internet. A few years ago, he and Co-Founder Thomas Andreasen had the opportunity to take over an entire gaming team of 13 people. Pocket PlayLab was the result. He says, “I think I got into gaming because I didn’t want to miss the opportunity of taking over a great team that had become available in a booming industry.”
Exceeding Expectations
The first challenge to the new company became clear immediately: not a single member of the team had ever built a server or mobile game platform to the size and scale they were aiming for. They overcame the challenges through trial and error, and in the process learned so much that they are now among the best in the field. So much so that they attract professionals who have worked on a large scale with the big games.
After a little over a year, with the team of 20 being paid out of Lykkegaard’s and Andreasen’s pockets, the company reached a crisis point. The end of Pocket PlayLab was in sight, unless they could raise money from outside the company or unless their next title was a hit. Lykkegaard met with investor after investor, but admits, “Every one of them rejected us at our first meeting for being unrealistic. They didn’t believe in our team or in mobile gaming.”
So the most exciting, proudest moment of his career came when he realized they had a major hit and no longer needed to raise money to keep the business going. He loved the feeling of proving all those investors wrong. But he points out, “They were right about our sales projections and valuation being unrealistic. We reached our 2016 projections shortly after launch in 2013.”
A Refined Plan
A lot has changed since Lykkegaard and Andreasen founded Pocket PlayLab. Their reason for starting the company was to figure out how to make a successful business out of making games, and they believed they would find a way by trying out a lot of directions. Today, they have a much more refined plan for their internal platform to produce more successful games with higher quality and at greater speed. They are still constantly testing new content and styles, but they know which direction they are going.
The team at Pocket PlayLab gets inspiration for their games through constantly playing and testing successful games to analyze why they like them and breakdown what it is that makes them successful. Lykkegaard emphasizes, “When you have done this many times, you start to have a clear idea of what would be awesome to make; then you do a prototype. If that prototype was not as fun as you expected, you start over. If it feels like a hit, you go into production.” This is the same way he learned about investing and founding a startup. He figured out who had already accomplished what he wanted to do, then he studied as much as he could about how they did it.
Looking at the Industry
Lykkegaard feels there is no other industry with as much opportunity to build a successful business as you will find in the mobile game space, with users willing to pay and distribution reaching billions. The biggest issue he sees in the industry is building something that users will love and use as part of their daily habits.
He recognizes that many developers see exposure as a great challenge with thousands of apps and games coming out every day. However, this is only an issue if a studio has become used to having things go viral in the early days or building games without a marketing team. Then they are dependent on having a big publisher pick them up. In every other industry, it takes a lot of money and PR to reach users. Lykkegaard asks, “Has the games industry just become lazy with their marketing?”
Choosing to work with a publisher or not is another decision developers have to face. After working both with and without a publisher, Lykkegaard has his own guidelines about when a publisher will be an advantage. He says, “If you have a freemium that makes over $2 + LTV, you are able to buy those users from advertising networks and make a higher profit without a publisher. If you have a freemium game that makes less than that or a premium, then go find a publisher. It takes only a few hundred dollars to find this out on a test market with ads, but many fail to do it.”
Future Plans
For now though, the future for Pocket PlayLab involves staying in the Cube universe for some time, but also include diversifying to reach other kinds of users; the games to do this are already in production. Lykkegaard is excited to see what they will come up with, since they are currently expanding to new markets and people. He says, “All I know for sure is that everything we have done so far has been a big step forward.”
Jakob Lykkegaard will be discussing more about how Pocket PlayLab was able make a comeback from nearly closing at Casual Connect Asia next month. To find out more, visit the conference website.
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