A new Istanbul-based puzzle game studio, Agave Games, has raised a $7 million round led by Balderton Capital. It is London-based VC’s second bet on Turkish games.
What does Agave Games do?
Agave Games will use the money to develop casual puzzle games. This genre tends to be mostly played on mobile devices, with titles like Candy Crush and Angry Birds being some of the biggest success stories in this category. The studio was founded by four former school friends – Alper Öner, Burak Kar, Ali Baran Terzioğlu and Oğuzhan Merdivenli – who previously worked together on highly successful casual games such as Zen Match, Wonder Blast and Words of Wonders.
Who Invested in Agave Games?
The State of the Casual Gaming Market
The entire video game industry has experienced a pandemic-driven growth spurt over the past two years as people look for ways to while away the hours they spend indoors. Recent research by Newzoo revealed that mobile gaming generated $93.2 billion in 2021 (a 7.3% year-on-year increase), with 2.8 billion people playing on the platform.
Casual games designed for mobile have always seemed particularly attractive to investors, as anyone can play with a phone, as opposed to just dedicated console owners. The genre is also believed to be easy to monetize due to the addictive nature of in-app purchases and short feedback loops in gameplay.
However, it is difficult to succeed in mobile games as the large number of titles available makes it difficult to stand out from the crowd.
Ilya Tumenko, CEO of Cyprus casual gaming publisher 10k Riders, recently described the mobile games industry as “in troubled waters”. He told Sifted that as the market grows, only about 1% of games that reach the user acquisition testing stage have any success.
However, Turkish game developers are proving their ability to stand out from the crowd. The country has emerged as one of the leading players in Europe in the industry with mobile gaming revenues a total of $160 million in the first quarter of 2022 — a 37% increase over the same period last year, according to research from Sensor Tower.
This makes the country the fifth largest market for mobile games in Europe in terms of revenue, behind Germany, Great Britain, France and Russia. And the country has already seen many mobile gaming successes. Zynga acquired Gram Games for $250 million in 2018, Peak Games in 2020 for $1.8 billion and 80% from Rollic for $168 million the same year.
While casual mobile games might be a tough market to compete in, the genre is certainly not going anywhere, and studios that hit a hit still have a huge market to reach. Agave Games says the entire studio will work on one game at a time to achieve market dominance with a single title. Focusing on quality seems like a smart tactic considering how many low-quality games are available on mobile app stores today. The founding team’s track record of making impactful casual games also makes it easy to see why big investors have chosen to bet on the new studio.