The Socialist

Thoughts and stuff from an early stage investor living in the age of social

When the good guys win: King and Riccardo

In November of 2009, fresh off the plane from my 2-week induction at Facebook HQ, I had coffee with an old friend Tony Zappala who at the time worked at Index Ventures. We talked about some of Facebook’s areas of interest for partnerships and when I mentioned gaming he said that I should meet the team at King.com, an Index portfolio company.

A few weeks later, in one of my first meetings as a Facebook employee, I walked up three flights to an office on Shaftesbury Avenue near China Town to meet Riccardo Zacconi, the CEO of King.com. For some reason I still vividly remember the fact that there was a fax machine in the office (who uses fax machines anymore?!?).

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King.com had been around since 2003 and had built a decent business (rumors say over 100M EUR a year) doing casual games on portals (think Yahoo!, ProSieben). Index Ventures had invested alongside APAX.

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I remember this tall, soft spoken, clearly smart man telling me the story about King.com, educating me on Games of Skill (and why it was NOT gambling) and talking about their Swedish studio and over 100 “casual” games. It was a nice intro meeting and we stayed in touch over the next few months.

In June of 2010 we managed to get Mark Zuckerberg to come to London and host a developer event at the Barbican Centre. In press activities he mentioned companies like Spotify, Zynga and Playfish (who had sold to EA in late 2009 for $400M). He spoke of Facebook’s commitment to scaling out a team in Europe and working more closely with the developer community. The event was a great way to signal to London and Europe that we wanted to be more present and more active in the ecosystem.

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What few likely remember was the presentation by a tall Italian gentleman, with Zuck in attendance, telling a capacity audience about how his gaming company had started using Facebook Connect as the identity platform for its online games and how the lifetime value of users leveraging Facebook was triple his average user. That person was Riccardo from King.

It was not purely through Facebook’s charms and Zuck’s speech that Riccardo started to pivot the company towards social (and mobile). Portal traffic was slowing down, Facebook was becoming the dominant destination for web-based gaming and his old business was at risk.

Over the next year, he talked about creating a new team purely dedicated to “adding a social layer” to his 100+ casual games. He experimented and learnt with the likes of Bubble Witch Saga. He bet on Facebook, but not on the Facebook of Canvas, Zynga and Playfish but on a Facebook that allowed him to identify, acquire, retain and engage users across web and mobile. He bet on social as the glue…

… And it paid off. In a 2012 interview Riccardo spoke about the evolution of social towards mobile. Bubble Witch Saga got to 4M MAUs, by the end of 2012 he launched the social version of a web-based IP in their portfolio called Candy Crush Saga.

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Today Candy Crush reigns supreme at the top of the gaming charts on iOS and Android and has over 90 million DAILY players generating close to $1 Billion in revenue.

If King’s IPO goes forward today as planned at $7.1B, a lot of people, including Riccardo, are going to make a lot of money… and you know what, they have earned it. This is not an overnight success, or an 18 month exit. It is over a decade of building and rebuilding a business, of adapting to trends and technologies, of being humble but hungry.

So here’s to one of those stories where it seems the good guy is going to win. King, along with Rovio and Supercell, have put Europe at the center of the new mobile-centric gaming world. The King IPO is a huge shot in the arm for the London (and Sweden) tech scene and perhaps signals a new wave of European IPOs yet to come. As a tech banker told me recently “we haven’t been this busy in decades!”

Sometime in late summer 2012, Riccardo and I had lunch on the rooftop of Soho House and talked about the evolving London tech scene. I remember his eyes gaining an intensity as he said something that (without him knowing) led to my decision to create White Star Capital: “Years from now when we have been successful and have had our exits, it is up to people like us to invest and support the next generation of entrepreneurs.”

Riccardo is a good man, and I know he will keep his word.