IGNITE- THE ULTIMATE LEAGUE OF ENTREPRENEURS
END GAME
Feng Ventures, formally known as DongFeng Partners is a leading
Chinese Venture Capitalist firm. Feng Ventures works with start-ups in
seed, early and growth stage investments. Although, headquartered in
Shanghai, the company also holds offices in Beijing, Chungdu, Guangzhou
and Xiamen, and is willing to expand globally. Feng controls hundreds of
subsidiaries and associates in numerous industries and areas creating a
broad portfolio of ownership and investment across a diverse range of
businesses. Since its inception in 2010, Feng has successfully funded
various companies such as Websters, KZone, Aedo (social media sites),
Silverspin, Informatic Inc. (software companies), Intel mission, QL
(artificial intelligence), Quick Cash, Paylad (mobile payment services) to
name a few. At present, it is one of the most active investment corporation
in the world with stakes in over 450 companies. The market size of Venture
Capitalist firms is around $79 billion, out of which Feng Ventures holds
around 38%, followed by WangZhao (27%) & Baidoo (19%) who are its
major competitors.
Feng concentrates primarily on the following technology sectors:
Mobile
Media
Security
Customer Care Services
SaaS
Feng has been making perennial efforts to expand in new arenas and has
identified an eminent opportunity.
From entertainment to e-learning, from socializing to making new friends,
the gaming industry provides a versatile space to its players. As the video
games culture comes to life in every neighborhood, it comes as no surprise
that its aggregate revenue is surging. In 2018, the gaming industry outpaced
television, the box office and digital music in terms of revenue. It collected
a massive revenue of US $116 billion (INR 8.29 lakh crores), a 10% hike
as compared to the previous year. Industry insiders will tell you that this is
not a shock, as mobile game ‘Split Tycoon’ alone generates nearly US $60
million (INR 428.94 crores) in revenue- every single month! (1US $ =71.49
INR)
The key to the gaming industry’s growth is innovation. What is intimidating
about an industry that is always innovating is that you are doubling up on
both your risks and your returns. Your position in the industry is at stake
from the moment you decide to venture in.
Everyday 25 new games are released on steam. There are over 2.3 billion
gamers in the world and the gaming video content market was $5.2 billion
in 2018.
Atarichan was overtaken by Mariotendo. Yeahhh was overtaken by Gogol.
Rockbuster was overtaken by Hula. If you had bet on Atarichan, Yeahhh,
or Rockbuster at its time, you could’ve lost everything, even if the industry
itself was prospering.
The Chinese games market is set to reach $35 billion in 2021. China has
approximately 600 million gamers at present. The gaming sector is
undoubtedly a high-risk-high-reward space for serious investors to be
playing around in. It’s one that the firm, Feng Capitals, is looking at very
closely.
Feng Ventures has been carefully observing the following two games from
the past couple of months.
1. Fantanomics:
An already established game plans to come up with a second season.
Fantanomics is a freemium mobile strategy video game developed and
published by Chinese game developer Supermell. The game was released
for IOS platforms on August 2, 2012, and on Google Play for Retinoid on
October 7, 2013.
The game is set in a fantasy-themed persistent world where the player is a
chief of a team, going on to form triads. Fantanomics tasks players to build
their own triad using the resources gained from attacking other players
through the game's fighting features. The main resources are rose gold elixir
and white gold elixir. Players can conjoin to create clans, groups of up to
fifty people who can then participate in Triad Wars together, donate and
receive troops, and chat with each other. Fantanomics was released to
positive reviews, garnering high ratings from many critics.
However, Feng Ventures is doubtful about investing in a second season.
Believing it to be a double-edged sword, even though the game already has
its market, they believe the market might not be fond of having to go onto
a second version. Furthermore, the developer targets the Asian markets.
The following snippets give an insight into this:
Asia’s video games industry will expand by almost 15 per cent annually in
spite of tighter regulations hampering growth in China, the world’s largest
gaming market, according to BUSS. Beijing moved to restrict approvals for
video game licenses at the end of August, but a strong gaming culture and
the success of existing titles will continue to drive China’s market and help
Asia become the biggest market globally for games revenue this year,
according to the Lifei investment bank.
BREAKING NEWS: LEAGUE OF LORDS BANNED IN CHINA,
SOUTH KOREA AND JAPAN.
League of Lords is such a global phenomenon, partly due to its incredible
success in China, which remains its largest demographic with hundreds of
millions of players. League is still the undisputed king of MOBAs both in
China and around the world, which prompted Feng Ventures to buy its
developer HRT Games in 2011
In spite of South-East Asia being the booming market for the gaming
industry it has its own set of problems.
2. BlackMander:
A new gaming company formed by 3 college students. There first game uses
a mix of augmented reality, mixed reality and virtual reality. It’s a
completely fresh idea, however the technology being used is rather new.
Apart from the fact that they don’t have a foothold in the industry, there is
a huge doubt whether such a technology will be accepted.
Virtual Reality is a simulated experience that can be similar to or
completely different from the real word.
Augmented reality is a technology that superimposes a computer-generated
image on a user's view of the real world, thus providing a composite vie.
Mixed Reality is the merging of real and virtual worlds to produce new
environments and visualizations where physical and digital objects co-exist
and interact in real time. Such a mix of technologies is a new concept which
has been worked upon for several years. However, being a new technology,
Feng Ventures is not sure whether it would click with the audience.
TASK AT HAND:
You are hired as a consultant for Feng Ventures, your job here is to analyze
the factors and make a prudent decision by chalking out a detailed course
of action to be undertaken by you as well as Feng Ventures. Now the
decision lies with you. "Take our needles and make them your swords".
Show what you are capable of and since it is the market you are looking at,
"May the odds ever be in your favor ". While solving you need to understand
the following things and present your answer accordingly.
1. The selected game should be clearly stated and the reason for such
selection must be mentioned.
2. The factors affecting the choice must be made clear.
3. Innovation is a double-edged sword. It can work in your favor, but it can
also work against you and just because the gaming industry is doing well
doesn’t necessarily mean your investment is going to do well. The consumer
appetite for games change extremely fast, and often, unexpectedly. How
would you as a consultant recommend Feng to counter this.
GUIDELINES
1. The response should be submitted in the following format:
Document Type - PDF
Font Style - Times New Roman
Font Size (Headings) -18
Font Size (Body) -14
Vertical Spacing - 1.5
Word limit -
2. The name of the document should be
TeamName_Partipant1_Participant2
For example – Gamechangers_ChehekNagpal_AnshikaGarg
3. References from other sources are allowed provided they have been
quoted. Plagiarism is strictly prohibited and would have strict
consequences.
4. The decision of the judges will be final and binding.
THANKS FOR
PLAYING!
