Speaking to us ahead of the Develop Brighton keynote this morning, Super Evil Megacorp boss and mobile games industry legend Kristian Segerstrale gave us his views on the current state of the games business, funding, cross-platform development and more.
He also talked us through the difficult time he and the Super Evil Megacorp team had when they had to reboot the company as it faced closing down its flagship game, Vainglory.
We round out the chat with a spot of buzzword bingo, in which Segerstrale offers his unfiltered thoughts on popular investor topics like AI, web3 and the metaverse…
It’s kind of bleak out there currently, but where do you see the big opportunities in games right now?
The industry is in flux – and at times of chaos there is always opportunity. I’m excited about three things right now.
Firstly, despite the many industry headwinds, we’ve seen many indie and double-A hits break through on PC this year. This shows there is still potential for modest budget, fresh, well executed social gameplay across platforms – this is also what we are betting on with our upcoming cross-platform launch of Teenage Mutant Ninja Turtles: Splintered Fate.
Another trend I’m really interested in is transmedia. We’ve of course seen movie adaptations of games, and game adaptations of movies for a long time. But it doesn’t yet feel like we’ve figured out how to truly build an IP in a way that organically evolves across both interactive and linear media over time. We think this is an important long term evolution of entertainment and why we’re hopeful we can learn more via our partnership with Netflix around the Rebel Moon IP.
I am also very curious about the evolution of business models. There are more viable business models in games today than there have ever been. From free-to-play to subscriptions to premium plus. I’m very interested to see how these will work together in the future to provide developers with opportunities to combine managing risk with maximum upside.
What would be your advice for studios looking to secure funding currently?
My first question would be “do you have to raise now?”. The fundraising environment in 2024 is challenging. Fewer venture investments are being made, fewer publishing deals signed, and more companies are chasing funding. So if there is a way to keep costs lower or stay profitable so that you can postpone a raise – that is probably a good strategy.
If you do need to raise, make sure your materials, plans and approach to the process is first rate. Avoid trend chasing, and instead focus on what you and the team are uniquely good at, that the way you approach the plan gives you room to fail, learn in the process and build something valuable for the long term.
The investments made currently are less about moonshots and more about solid game company building. Showing you have the skills and approach to not just build a great game but build a valuable company for the long run.
What should studios seeking funding avoid doing?
I think the single most important thing is to really put yourself in the shoes of the person you’re pitching to – what are they looking for?
If talking to a venture investor, they’re interested in the team, the company vision and ability to build a sustainable business over time more than the game itself. If it’s a publisher it’s the game itself and the team’s credibility to execute on the vision and willing to partner closely.
Nothing comes across weaker than turning up to a pitch out of tune with your audience.
Speaking of what not to do: SEMC went through a reboot 5-6 years ago. Tell us about what went wrong, and what changes you had to make.
SEMC had a wonderful initial journey with Vainglory between 2014 and 2018 or so. Vainglory in many ways defined what core gaming was to become on mobile.
But, while we had built a popular game in Vainglory, we had not built a sustainable company. Our costs were too high and we had no other titles in development. So when Vainglory started to decline after a few years we didn’t have a plan B.
In 2018, after I took on the CEO role we went through a reset and brought on new leadership. Instead of focusing on a moonshot single title, we decided to build a multi-title company pursuing genre mastery for cross-platform co-op action games, making each title a way to further our technology, talent and know-how.
We decided to go fully distributed to enable us to work with the best talent while keeping our overheads minimal. Taking orthogonal risk with each title, building our self publishing capability, but also working with publishers on some platforms and titles, to constantly get better at what we do, and constantly build a better, more sustainable home for talent.
We’ve come a long way. We’re now a team of over 100 game makers. We’ve stayed profitable through the industry headwinds. We’re excited about self-publishing TMNT: Splintered Fate – originally launched on Apple Arcade – to Switch with other platforms to come, and our partnership with Netflix for Rebel Moon, as well as some other unannounced projects we’re pursuing.
Based on those experiences, what advice do you have for folks navigating tougher times?
Change is really tough. But if you have to change anyway, you may as well make the really bold choices to set you up for the future. Make the most out of the crisis you’re in.
To build a great company you can’t assume success. Things can and will go wrong. Having a plan B and a plan C at all times greatly increases your resilience and sustainability as a studio.
Great studios are built over time. Teams that can weather tough times ultimately become much stronger and often have a higher likelihood to succeed in the future. Hang in there!
Tell us about working with Netflix – how does removing monetisation from the picture change your processes?
The target commercial model for a game will of course profoundly impact its design. To succeed, all games need that alchemy of gameplay that is fun and creative that is memorable. But in addition, for a free-to-play model to work, the design objective has to maximize retention while also encouraging players to make a purchase. For premium with DLC, and also in the case of a subscription service like Netflix, we can focus entirely on retention and regularity.
So some of the design constraints change. But in the end, all games on all services have performance goals and we are just as rigorous about those goals for subscription services as we are for premium, or microtransactions services.
You’re now working with some big licensed IP like TMNT and Rebel Moon, what do you think studios should be aware of if they are working with a licensor?
We are really passionate about building IP. Whether that is new IP or building some extension of existing IP. In both cases we put a lot of effort into really immersing ourselves into the world and the characters we work with. We spend a lot of time with the writing and creative teams, having a lot of humility around our ideas, but also not shying away from proposing something bold and new to add something fresh to the IP universe.
We were really excited about proposing the very first roguelike game concept with the TMNT IP for example. We wanted to build something with more narrative, variation and co-op team combat and were excited that Paramount shared our ambition to do something new. Also getting to work with Tom Waltz – a long term writer in the TMNT universe – was amazing!
Of course working with the licensor adds more communication and coordination to the game making process. Some might see that as overhead or a restriction. We see it as an opportunity to plug into more talent and expand the team to help make the game even better.
Splintered Fate is mobile and now Switch – is it coming to other platforms as well? What have you learned from working across platforms like this?
We have big plans for the title and will announce future expansions and platforms in due time…we only build cross-platform games, so we think a lot about our game development process and how we approach game engine tech and visuals.
For the three C’s – controls, camera and character – our learnings over time have been to plan for cross-platform from the start as opposed to adapting them later. We playtest on a mix of physical controllers, virtual joystick and mouse and keyboard controls very early on in our prototyping phase to make sure the camera, character and controls of a game are truly fit for cross-play.
Of course there will be adaptations and refinements for each platform to make the game feel native to that platform, but we want the core of the game to hold up well across each of the three C’s.
For engine – we chose to build our own Evil game engine from scratch to be able to support the highest fidelity gameplay on the broadest range of devices. To be successfully cross-platform you have to simultaneously be able to deliver a sparkly, striking visual experience on the highest end devices, while gracefully degrading the graphics to still deliver a beautiful and fluid experience on the lowest end mobile platforms.
This requires careful planning artistically and technically from the start, but it is also very hard to deliver with off-the-shelf engines like Unity and Unreal. We feel very fortunate to have doubled down on our own-engine strategy for delivering the best co-op action play across the broadest range of devices.
Okay it’s time for buzzword bingo – can you give me your thoughts on each of the following, starting with AI:
Will no doubt evolve both how we make games and what kinds of games become possible. I believe AI will settle into a space where it enables creation tools that augment the art – that make it easier, faster and more efficient for artists, designers and technologists to help bring their vision to life.
To help us run companies and teams better, and ultimately build games with more variation, content and believable worlds. But it will take time for these tools to evolve. I think AI will be an evolution, not a revolution in game-making.
Cross-platform: I think it will be rarer to see single platform games and that cross-platform will be the standard for mid-core and core genres moving forward. It lets everyone play regardless of the platform they’re on. It maximises the size of the addressable market and helps maximise the return from both the marketing and development investment into the game.
Making a great game is really hard. If you do manage to make it, there are fewer and fewer reasons not to make it cross-platform. At SEMC we only make games intended to be cross-platform live services from the start.
Transmedia: Much like cross-platform is the natural evolution of games, I think transmedia is the natural evolution of entertainment IP. We have had translations of IP for a long time between games, movies, TV, comics and so on. I think in 10-15 years that way of thinking about entertainment IP will feel obsolete.
I think we will by that time have figured out more intentional ground-up creation and planning processes for entertainment IP where each expression of the IP across linear media and interactive media is both a worthy entertainment experience on its own, as well as contributing to the IP universe in a way that forms a continuous, evolving, ‘live ops for IP’.
Web3: So far web3 games have mostly spanned the spectrum of ‘a solution in search of a problem’ at one end, and ‘a ponzi scheme for asset speculators’ at the other.
Does it always have to be this way? I don’t know. I know a lot of companies are working on it, and I can see the appeal of the broad idea of player ownership of assets, tradeability and perhaps even players somehow sharing in the economic outcome of a game with its community.
But as a player, I have not yet seen a game that actually delivers on any of this in a way that would excite me. Perhaps one day? It’s not something we look at at Super Evil Megacorp at all.
Metaverse: The metaverse feels like a word that came and went pretty quickly. As a game maker it’s hard to imagine how the practicality of asset portability and a single interconnected game universe would work in practice with how we make games today without it being controlled by a single company – the way Roblox is for example.
But I certainly enjoyed reading Ready Player One and who knows, perhaps someone can bring this to life in the distant future. I’ve come to learn to never say never when it comes to games…
