BizPunkMitch Lasky's blog

Last week, Benchmark announced our investment in PlayFab’s Series A round. I will be joining PlayFab’s remarkable CEO, James Gwertzman, on the company’s board of directors.

PlayFab is an infrastructure company enabling game developers and publishers to get 21st century content to market.  As anyone who has been paying attention to the games business in the last decade is no doubt aware, video games have been utterly transformed by new platforms (primarily mobile), new forms of commerce (such as micro transactions and virtual goods), increased social interactions among players, and a highly-dynamic approach to post-launch testing, analysis, and modification. PlayFab’s product is designed specifically for this new content paradigm.

In the past few years, traditional incumbent publishers have dramatically reduced their product slates. As a result, more and more high-quality developers are migrating to new platforms, seeking to put their skills to work in the new growth areas of mobile and free-to-play PC gaming. However, their ability to launch successful new products on these platforms has been severely constrained by the lack of coherent publishing and live-game management infrastructure. Sure, technologies like Unreal and Unity serve as first-mile development engines, and services like Steam or the Apple App Store serve as last-mile digital retailers and distributors, but there is a massive amount of publishing infrastructure in between these poles — and, in my view, a massive opportunity for a company like PlayFab.

I know this first hand. I have seen game companies that I have backed — even very successful ones — struggle to cobble together disparate 3rd party technologies and jerry-rig a live-game platform. I’ve seen these companies devote significant and precious resources to rolling their own, because no viable commercial alternatives were available. But more interestingly, I have heard dozens of pitches for really compelling games companies in the last few years that have ended with me asking the entrepreneurs how they intend to handle publishing and live-game services, and my questions being met with baffled silence. Ironically, many of these developers have ended up licensing their games to so-called “online publishers” in order to secure this infrastructure and service layer, only to discover that the publisher’s in-house technology is unstable at scale and severely lacking in modern features.

At Benchmark, we’ve been looking at this platform opportunity for several years — I’ve written about it and talked about it publicly many times. In PlayFab, we believe we have found the right combination of team and technology to create a really important company in this space. More than anything, we were attracted to the relative maturity of PlayFab’s platform, tools, and team at Series A. The platform has benefitted from over three years of development and testing at scale — including multiple top-10 titles on Steam. And PlayFab’s CEO, James Gwertzman, has a wealth of domain experience gained from multiple game startups, work in infrastructure at Microsoft, and as head of PopCap’s free-to-play game operations in China.

So, we believe there is a big, unserved market for PlayFab, with significant economies of scale. We believe that PlayFab can deliver better infrastructure to developers than they are likely to be able to develop themselves, and to do so faster and cheaper, letting the developers do what they do best: make great games. We love James’ drive and ambition, and look forward to helping him build PlayFab into the next great video game platform.

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