Timo Soininen is rather proud of the fact that the company he co-founded - Small Giant Games - has succeeded in the global games marketplace without the ‘advantage of a large development team.
In fact, the company’s third product - a role playing game dubbed Empires & Puzzles -climbed into the 100 list of top grossing titles after being built by just 12 developers in less than a year. And as Soininen sees it, being small was an advantage rather than a hindrance. “We believe that small teams can do fantastic things,” he says.
Times are changing. Small Giant this month secured a $41m investment, led by VC Fund EQT Ventures and has rung up revenues of $33m in 12 months. Nevertheless, Soininen intends to the keep the operation lean and agile, even if there is plenty of money in the company bank account. But is it possible to stay small when scaling up sales? Small may be beautiful, but is it sustainable?
Almost Impossible
Based in Finland, Small Giant was formed around four and half years ago by founders who had been in the games industry for many years. That track record helped the nascent company raise around 9 million euro through a series of investment rounds. A substantial sum but not enough to allow the games development company to compete head to head with better funded rivals who could throw dozens, or perhaps hundreds of bodies at the development process.
As Soininen acknowledges, it was almost unheard of for such a small company to compete with the big league players of the games industry.. “We looked at the data and concluded that it was almost impossible for a small company to make it into the top 100,” he says. .“If we were to succeed we new we had to come up with a new paradigm.”.
So the first step was to analyse the games market. Small Giant’s chosen target was the so-called casual games market - or to put it another way, games played on mobile apps or on social media rather than on PCs or dedicated gaming platforms. At the same time, the company looked at mid-core games.
Detecting A Market Gap
“We detected a gap in the market,” says Soininen. “We could see demand from casual players for games that went a bit deeper. But at the same time, those casual players might be deterred by gameplay that was too complicated or difficult.
So in Empires & Puzzles, Small Giant, set to bridge the gap between deep, complex, very immersive games and those that were aimed at a much broader and - by extension - less committed audience. The solution was a game that was as easy to approach as, say, the Candy Crush series while at the same time offering more depth.
That was the strategy and it appears to have paid off. But in addition to identifying a market niche, Soininen says the culture of the company was a crucial factor in the rapid development of the first product. Small giant wasn’t small, just because that was the reality of the situation, it also set out to create an operational environment where a handful of developers could - as Soininen sees it - work more efficiently and creatively than larger teams. “You can get a lot more done with a small team,” he says. “In particular, you find that communication is a lot easier.”
Putting The Ducks In A Row
But there are, he says, certain ducks that have to be placed neatly in a row. First and foremost, even if those on the payroll are small in number, they have to be on top of their game. “You need good people,” says “Soininen. “As long as you have good people you don’t necessarily need a lot of money.” That’s a principle that Small Giant has applied not only to games development function, but also to the all-important marketing operation, where the user acquisition team operates with just three people. Of course, one man’s “lean and agile” is another man’s “understaffed.” Soininen acknowledges the importance of motivation. “Everyone within the company is incentivised,” he says.
Don’t Reinvent The Wheel
Small Giant carried out extensive market research before launching into the development process and Soininen believes this was important in terms of focusing minds on what needed to be done, rather than wasting time experimenting. “It’s important not to attempt to reinvent the wheel,” he says. “It’s thrilling to do new things, but it’s also risky.”
So Small Giant looked at the other games publishers - particularly in the casual sector - in terms of what they were doing right. This informed the development of Empires and Puzzles.
The Next Steps
Small Giant makes its money by selling add-ons to players within a game which is otherwise free to play and to date it has generated revenues of 33 million euro. The plan now is to build on that start by stepping up the marketing operation. But Soininen insists, that the company will remain relatively small.
“We are going to expand a little bit,” he says. “But not by too much.”
