Sydney-based Gamer Institute is an educational platform for competitive gamers, founded by Bosco Tan, Daniel Grzelak and Semin Nurkic last year.
The business has partnered with IvyLoL.com, a global amateur collegiate competition for the popular riot game League of Legends, with tournaments attracting almost 3,000 players.
Tan talks to StartupSmart about going for gold in the gaming industry.
What is your background and how did it prompt you to establish Gamer Institute?
My background is in years of consulting, and subsequently working on strategic projects at one of the largest Australian and New Zealand media companies.
My co-founders have many years of corporate and start-up experience. Together, we have a unique mix of commercial and technical backgrounds, and a diverse combination of experiences, including past successes in building and growing websites to acquisition.
Daniel, our CEO, is the originator of the Gamer Institute idea. His “imagine if we could learn to play basketball from Michael Jordan” pitch sold it.
Following a range of preliminary research into the growth of gaming globally, and looking at the success of similar models in primary education (Khan Academy) and poker (CardRunners), we were convinced there was an amazing opportunity.
We believe we can contribute to the 20% projected growth of the emergent competitive gaming (eSports) industry over the next five years, which today is already valuated at US$1.5 billion globally.
With the overall gaming market at US$65 billion today, there is also a sizeable audience globally who wishes to just be competitive within their social circles.
How long did you work on the business before you launched it?
Above: Bosco Tan, Daniel Grzelak and Semin Nurkic
We have spent the past six months working on the platform and developing various industry networks, recruiting professional gamers and seeking relevant partners.
How did you fund the business and what were your start-up costs?
We bootstrapped the business ourselves, drawing on our personal capital as well as proceeds from the successful exit of a previous project, ShouldIChangeMyPassword.com – a website which allows individuals to check whether their emails are present in hacked databases.
How did you convince IvyLol.com to partner with you?
One of the first things you’d find when launching a marketing campaign in any start-up is that there is an ocean of adjacent organisations eager to grow in any way possible.
IvyLoL recognised the value we could add through sponsorship to their competition participants, as well as the potential to increase their already impressive global reach.
We in turn recognised that they provided us with a platform to reach a huge number of potential Gamer Institute users.
We put together a mutually beneficial deal and a few teleconferences later, it was agreed upon.
The key challenge here was to prove our worth as a “yet to be launched” organisation. I believe our professional and methodical approach, as well as a commitment to understanding their objectives and their audience, really helped to overcome these concerns.
A lot of how we have been thinking about promoting our business is consistent with our learnings from ShouldIChangeMyPassword.com.
We are trying to use ways which stretch our marketing dollar for maximum results as much as possible. This is why partnering works.
We want to, as much as we can, turn a “Gamer Institute promotional problem” to a common problem for our partners to solve with us.
One example is inviting prominent gamer blogger Lendo Khar to create a comic strip to celebrate our IvyLoL sponsorship.
By understanding the appeal of his artwork to our IvyLoL and Gamer Institute audiences, and the appeal of our message to his audience, we have effectively found a mutually beneficial method of making the whole consumer experience better.
We also treat our professional gamers, who create the educational content for us, like partners too. By committing to build their individual and team brand, they are incentivised to be the voice of Gamer Institute to their fans and followers.
How many staff do you have?
We currently have three founders working on the project.
Behind the scenes however, we have a range of partners we are working with, which makes it feel like there is a much bigger team, from IvyLoL to our professional gamers to people like Lendo.
What are your revenue projections for 2011/12?
I prefer not to share our revenue projections at this point. I think what we ultimately can have is an annuity business with a decent margin.
We are positioning ourselves for advertising and product partnerships in 2012/13.
In 2011/12, we are focusing on proving the model and building an audience for an initial game – League of Legends – before quickly expanding to other titles.
Given the closure of various gaming studios, how do you think the industry is faring?
This has been disappointing for the game development industry in Australia, particularly in the context of high government investment in the film industry, which is less financially viable at the macro level.
A lot of the studio closures were associated with the increasing competitiveness and volume of titles flooding the market. So it is definitely not structural decline in demand, but rather increasing competition in game supply.
We attended the EB Expo on the Gold Coast earlier this month and aside from the general enthusiasm of the record-breaking crowd, it is the diversity of the crowd that amazed me.
Gaming is now truly a mainstream activity. The demand is everywhere in every demographic. This is the reason why gaming is the only segment of the media industry that is moving at 20-25% growth annually.
So in that context, it is positive for Gamer Institute. As long as gamers play and continue to want to beat one another, and as long as the best gamers in the world create a viable prize-money economy for the rest to strive for, we are in the perfect position to satisfy that demand.
Do you have any tactics to ensure your start-up remains viable? If so, what are they?
I am a student of the Eric Ries’ school of monitoring, pivoting or persevering – working with small batches. We are very much listening to our audience all the time to try to stay on top of what they are after.
Even during the development process, every partner we seek and work with – whether they are guys in a garage working on their own gaming start-up, professional gamers we sign, gaming peripheral makers or amateur gamers – we show them our progress and ask for feedback.
I think ultimately, we are a platform and content play. As long as we get the platform right and we continuously pick the right game and create the right educational, we’ll have a sustainable business model.
Partnering as much as we can, where it makes sense, also provides the level of scale which a potential competitor will find hard to match on a similar cost base.
What advice would you give to Australian gamers?
Keep playing and challenging the world.
There are a lot of great competitive gaming talents here in Australia and they are all very young. We saw this first hand at the World Cyber Games Australian qualifiers on the Gold Coast.
However, we are a far cry from the “gaming dojos” in other parts of the world where competitors live together and practice day in and day out, much like professional athletes.
For those determined to be the best in the world, there is currently a narrow path that could lead to the $100-500k yearly earnings as a pro-gamer.
We are definitely facilitating that development process, and seek to help move some obstacles and widen this path along the way.
It is a lot easier to get to where you want to go if you have access to the experience of the people that are already there.