Taehoon Kim is a serial entrepreneur in the gaming industry and has raised tens of millions of dollars for his ventures that have garnered millions of users and helped pioneer MMOGs.
Taehoon Kim, CEO of nWay, on building successful online and mobile games.
John:
Privet, Dzień dobry, Hola, I’m John from JetBridge. We’re an elite group of software developers from around the world. We solve technically difficult problems for VC funded startups, and also invest in hypergrowth startups at the seed stage. Our guest today is a serial entrepreneur in the gaming industry with multiple exits to his credit. Taehon Kim, who is currently CEO of nWay makers of the popular Power Rangers MMOG game, which became one of the top games in South Korea, notoriously difficult market for new games. I’m excited about this podcast because personally people like Taehhon and are an inspiration to me because I’m like myself who went into B2B SaaS to make a buck Taehoon pursued his passion in a really difficult industry, multiple difficult industries, and has found repeated ways to be successful. So today we’re going to learn all his secrets to success. Welcome to him.
Taehoon
Thanks for having me. It’s a pleasure to be on this.
John
Yeah, and like I said, you know, there’s so many smart IT folks in the CEE region. I know they’re gonna learn a lot from you, especially those that are interested in gaming. Tell us where did you grow up? And how did you end up in San Francisco as a Korean dude?
Taehoon
Yeah, so I was born in Seoul, Korea. And then we moved to Vancouver, Canada, when I was in fourth grade. So and then we and then I finished high school and in Canada, and went to Cornell University in New York State. I studied electrical and computer engineering for undergrad, and the operations research for for my masters. And then during my graduate studies, I met another cornellian his name’s Jeff Hawkins, he created a Palm. I don’t know if you remember that. But it was the first mass market handle computer. And I really got into palm and PDA is in general. And at the time, Samsung, they were the first major mobile phone OEM to license Palm OS to make a phone. And this is way before Apple and all that back in like 2001, and two. So because of my kind of expertise in PDA and HoloLens, I got recruited from Samsung, I moved to Seoul, Korea, I worked at headquarter. And the team I was in I was calling the business development team. And that’s the team that started the smartphone business. And I ended up taking on a project that was a gaming smartphone. And you know, I was going around the world trying to get content for that. And that’s how I got into game industry. I eventually ended up leaving Samsung to start my own to get into game industry. And then, when I was starting my own company, my one of my investors actually said, Hey, like, maybe you should move to the Bay Area with your employees. And so they ended up incubating me at their office space in Sand Hill Road, and that’s how I ended up moving to San Francisco Bay Area in 2011.
John
Okay, you mentioned Samsung, aka the Korean mothership. Samsung’s pop, you know, products are super popular in the CEE region. I’ll be obviously all over the world but especially the CEE region. Air conditioners, fridges, microwaves, washer, dryer phones, of course, computers, tablets, what have you. It’s a big brand in the CEE region. What’s the difference to you, having worked on both sides of the planet working for a Korean company like Samsung, versus say, working in a Silicon Valley startup?
Taehoon
Big differences not only culturally between the two countries, but also the startup versus a big, fast growing company. And when I joined Samsung, they were in this tornado of growth. They had just launched and this is back in 2002. They had just launched their first color flip phone, it was small phones was fashionable at that time to the smartphone possible. And there was as soon as they launched they were selling like 2 million units per month. And then while I was there, they went from being known as a microwave company to overtaking Sony in brand value in such a short period of time.
Taehoon
And then the culture there. Imagine if Steve Jobs was running an army. It’s rule that’s fear, and everybody just does what they’re told, no question asked. So things are getting done super fast, you’re always crunching. But innovation is harder.
Taehoon
And they also had this surveillance culture, which was unique to Samsung, where I don’t know if you know this already, but their HR team is this super powerful CIA like group. It’s different from a normal HR unit in other companies. They knew exactly where you are in the buildings, everybody has a card that they’re carrying, and has a sensor in there. So it shows you exactly where you are in the building. If you’re going to a place we’re not supposed to, like rings the bell and they know, the fire. You know, if I partied too hard last night, the night before, and I’m like falling asleep in the bathroom, they call me like why are you there. Software and laptop that does keep keep keystroke detection. So if you’re chatting with your friend and you write, you type words that are sensitive, and they start recording, they know exactly when you go in and out. So they had the script. And so they’re very protective. It’s similar to Apple in that way, where they’re very secretive, very protective of their IP. And so yeah, so so that was different. And the group overall, the Samsung Group overall, they try to install this work life balance early on. So right before I got in there, they had to seven to four, work hours. So you get you get to office at seven, and you leave at four. And the whole kind of premise behind that was okay, if you can leave at work at four, you can have another they can do something else after work, you can have another life after work. But that never happened. Obviously, you started seven, then you end up working a lot when I got there, they switch to eight to five. But you you ended up working late, and they also just culture were like, you know, it’s more of a Korean culture back then. Things have changed now. But you can’t leave until your boss leaves, and your boss never leaves, it’s not culturally right to do that. So even if you don’t, if you’re dealing with your work, you still have to stay. So yeah, it was a cultural it was it was difficult.
Taehoon
And they were just becoming a global company. So I saw a lot of these. They were they were they started recruiting outside of Korea a lot more. But they just couldn’t handle the culture, cultural differences, so many of them would come in. And I would see them leave in like three or six months, they couldn’t survive more than six months, like most of them? So I thought to myself, okay, if I can survive this long term, maybe like, I’ll end up being the only kind of person with no global minded or speak fluent English and stuff like I will have more opportunities. And, and that’s exactly what ended up happening.
John
So in 2005, you raised, you used your global soft skills to raise $30 million from NEA top tier firm, for real time world’s Korea, massive MMO game that recreated Korea. So what was that like to build? I mean, that sounds like a massive undertaking, like how do you even start something like that?
Taehoon
So how that happened is, so I was, I was in charge of a game phone at Samsung. So I was going around the world trying to get content for that. And I met with Dave Jones and Tony Harmon, who were the co founders of Realtime Worlds. And they’re very well known in the gaming industry. Dave Jones is creator of lemmings and Grand Theft Auto. And they were based in in Scotland, and ended up joining became like an early or early employee there. And they had this amazing talent, right? They had people who design these amazing games, but they’re based in Scotland and didn’t know about the whole Silicon Valley culture. So I was like, Hey, you guys, you know, you guys can raise a lot of money. You know, you have amazing talent. And what you’re doing is very unique. Because we had an ambition to and so we had three part one was crackdown, which was which became a huge part of Microsoft was it Microsoft existed. And they had a game called a PV, which is an online PC game, basically Grand Theft Auto Online. And the third product was on this virtual world platform where we took these geo like Google Maps type of data, and then recreate the whole earth as a gaming platform. For developers and for us to create many different types of games, on top of that, on top of that platform so that players can actually play games, and on top of real world they can play in San Francisco and New York.
John
So how did you pitch this to NEA? I mean, $30 million in 2005 is a shitload of money. Like what?
Taehoon
So as I told him, like, Hey, we have an amazing vision. And you know, there are big VCs in Silicon Valley, who would love like, who loved these big ideas that can transform the world. So I called up my professor at Cornell, who was friends with Bikram like who was the founder of NEA. So I created I actually wrote up a business plan, and created a deck. And then I went and pitch this idea of, you know, recreating the world, the whole earth into a gaming world, it was a bold, big idea. And big VCs and in Sandhill road, they have so much money, they like these big bets, right? They’re looking for the next huge, multi billion dollar company, or they’re looking for the next company, and they can change the world. So they like that big vision. And so they ended up just, even though the company was pre revenue, just based on the team and the good vision. They’re like, Hey, we want to put in 30 million on our own without any other VCs coming in. So that happened, like super fast. And so like the company and that reason, 30 million. And because I was based in Korea, I ended up building a development team, because there’s really a good development team for online games in Korea. So I ended up leading realtime world’s current operation.
John
But that just sounds ridiculous. Right? Like you didn’t have revenues, much less a product, and they gave you 30 million. Is there anything special you did? Like, what do you credit with that? Is it because you’re incredibly handsome? As far as an Asian man? Is it? Because you you had a really good looking deck? You just happen to have an idea they loved? How do you credit that?
Taehoon
I think a few things. One is that we had a proven team, we had experienced developers who have hit homeruns before. So that’s one thing that VC is investing in teams, and they invest in people more than anything. So having that having team in Korea and Scotland, we’ve done huge games before that helped. Number two, is that we weren’t just making another game, which is you can do that. But that’s very competitive, like, Hey, we’re gonna make another game on Xbox, just like in competing with other big companies that that would be a very expensive endeavor. What we represent to them is like, hey, well, we’re creating a platform that never existed before we’re taking these telematics data. We’re gonna recreate the world that we live in a virtual environment. And and that was such a novel concept back then. That they will want to bet on it. They’re willing to.
John
And was there anything about Korea, its density, its people our culture that you pitched as why Korea first.
Taehoon
And one thing that was unique about Korea, from a perspective of the game industry is Korea is where online gaming was born. It’s where innovations around online gaming, like free to play, microtransactions was all kind of invented in Korea. The Korean people have been doing this longer than others. And so if you’re looking for engineers, like software engineers and designers, who have done this before, you couldn’t find it. You couldn’t find them outside of Korea at that time. Sure. So this combination of like technical talent in Korea was kind of the creative talent in Scotland. And they’ve been doing amazing work in gaming. You know, they create a lemon, for instance, which was the first game where you can individually select units and assign the contest. Yeah, amazing creativity right there in Grand Theft Auto was his first game that didn’t have a linear storyline, like you can do anything you want in the game. Those type of integrations, creativity was happening in Scotland. So you combine that with kind of the technical talent of Korea so that’s why it was good pitch.
John
Isn’t that interesting? Interesting. We see a lot of rising technical talent in Poland, Ukraine, Bella, ruse, even Russia. I don’t wanna say even Russia, I say even because I don’t have that much access to Russia. But you know, Russia, of course as well, Croatia, Hungary, really all over the CEE region. The ability for someone like you to get this many users it, I don’t want to downplay the technical achievements that you and your team have had, but there must have been some great marketing achievements to get those users at that scale. No? Or was it really a build it and then they came?
Taehoon
Yeah, that’s the hardest part. So for Power Rangers: Legacy Wars, for instance the brand helped a lot. We we timed it for the game launch together with with a movie that landscape producer at the time. And then we got heavy featuring from from Apple and Google, because it was the first fighting game, where you’re always playing with another human being. So there was that innovation novelist to the game. So you have to have all those aligned, you have to create a game that has that provides some sort of a new experience to the gamers and to get attention of the platform holders. And then unless you have a big marketing budget, getting an IP that’s already known by by players, you also have to select the IP for that it has a deep history and that and then the AP can bring in users without having to spend huge market on a budget for you ua. So right. That’s one example. Oh, come on go.
John
Right. Yeah, yeah, Pokemon Go. There’s a great gaming studio small independent gaming studio called Totem Games, a shout out to Totem Games. And they released a carnivore, like, carnivorous dinosaur game on iOS, right around and they timed it with the latest Jurassic Park movie. So even though it wasn’t, it had no, you know, financial affiliation to the people that made Jurassic Park or the movie, because they timed it well, and found a compatible theme. It was a super successful mobile game for them. So that’s a really good point. We talked about Korea a little bit before. On the subject of Koreans and Asians, after, you know, your real time experience, you started a unrelated startup called AB Connection, which I’m guessing he was like, Who’s gonna let every Asian American son and daughter get into Harvard or medical school? Right? Asians would understand that joke, it’s not racist, I promise you. This, it’s such a departure for you. How Why?
Taehoon
Essentially, AB Connection was, I started IV connection right after my, my grad school before going to going to Samsung. So so right after school, I basically created a system and a formula that quite accurately predicted a student’s percent probability of getting into a specific college. So I just developed this program to increase those chances, because I knew what moved the levers and also help clients actually make the right choices. Because everyone’s gonna just, you know, early application to Harvard, even though he has no chance of getting to get like 1% chance of getting Harvard. But early application is actually a really good tool to if you if you do it with the right school, to increase your chance of getting in that school. So making the right choices, picking the right schools, and also like consulting them in terms of where they should spend their time to basically optimize their chances of getting into into the best college that they can. So it was it was like a basically a program. I was doing my graduate studies and operations research is all about optimization. So I kind of use that knowledge to create this kind of discovery here. And so I created a new service. And it just took off like crazy, like everybody wanted to sign up in Korea. Every family who has ambition, or you have family, a lot of them are family that have money, right.
Taehoon
Everybody was on the line. But I had to go to Samsung. So I actually ended up hiring a CEO, I had hired a lot of people. Here’s my program, you guys run it. And, you know, I stayed on as a board member, just kind of helping out. And the CEO that I would hire with turn, because it’s so stressful to work with these parents in Korea. I’m trying to, like the Korean parents are like, right. Right. But that’s, that’s a, that’s how I ended up happening.
John
Right. I my next question was, who was the worst? The parents, the kids are the teachers but I’m gonna guess..
Taehoon
By far the parents, unbelievable. They were crazy parents.
John
Who acquired it, and why?
Taehoon
So on the seventh year of running it, I had imagined there was being there was doing a good job. And they’re pretty successful. And they wanted to kind of do this in the long term. So raised money to buy the company. And I thought that was pretty cool. Because I was not able, I was getting more and more involved in my other startups, and I wasn’t spending that much time here anyways.
John
Well, let’s talk about Nurien, that you you went into this next, and you raise another 25 million from NEA, did you learn anything from your previous ventures that helps you exit better at Noreen like were you able to get better terms get more buyers to the table.
Taehoon
I was way more savvy by then, in terms of how to pitch and how to negotiate term sheets, and things like that. But when I was raising money for Nigerian timing helped me because at that time, China was just opening up their online gaming market in China, which is taken off like a rocket as well as other kinds of internet companies. And so it was fashionable at that time for Silicon Valley VCs to set up offices in Beijing. And I remember that, and in Shanghai, they’re all kind of trying to find companies invest in that area. And the strategy that we the mission that we had with with Nurian was to take the development talent, innovative, you know, work that we do in Korea, and then kind of exploit the Chinese market and launch these games, mainly in China. So that that clicked really well with with VCs. So we ended up getting multiple term sheets from Silicon Valley VCs. Yes and so we ended up raising pretty good money at a good valuation again like before this was all before revenue or before before launch.
John
You see you are a lot more sophisticated the second time around what advice would you have given your first time around the block Taehoon younger self in terms of one raising money and two selling your company?
Taehoon
On the first time around, I spend a lot of money on the on the business plan and on the financials and then quickly realized that you know, or seed or series A fundraising they know that like VC, the smart VCs know like you can have the best plan but will never work out. That way. You can have like the numbers like y’all is amazing chart with like all the spreadsheet analysis. And but don’t believe it anyways, they’ve seen it enough to know that you can’t predict it. As soon as you start all the planning actually is too old. So yeah, I would tell myself to spend less time with that kind of stuff, but more on kind of putting together a simple but very compelling story. Because fundraising is all about storytelling. You’re telling a story about how you see the world how you see things changing in the future. They’re buying the future, basically. Right? And so kind of crafting that so that it’s one very easy to understand and, and simple. And that second, it’s a very big vision. If it works out, it’s a massive homerun. And three, take your time to craft the story so that the VCs who are listening to it and feel like okay, a lot of these risks are mitigated here because he has thought about these risks instead of trying to avoid the risks. So those things are much more important than putting together a plan with all the numbers and graphs and charts.
John
Well, what advice would you give your younger self in terms of selling your startup?
Taehoon
It’s kind of related, I think. It’s kind of similar to hockey I when Gretzky said that, you know, I think he said that he escapes to where the puck is going to be, not where the puck has been, or is. So is similar. So like, if you’re trying to raise money and also maximize 10s of exit later, then it really comes down to timing and how you predict the future, right? So you have to be able to read the trends of how the industry is moving. And then, by the by the time you launch, you can’t be too early, or we can’t be too late. The timing has to be right. This is why a startup is so difficult. And high failure rate because even if you execute perfectly, and if you’re early, and there’s no market product market fit, and then you’re dead, even if you’ve created the best culture, and you’ve done everything perfectly, if the timing is not right, if there’s no part of market fit, then then you’re dead.
John
I was a advisor to a startup in San Francisco called 6Connect small group of super smart guys, Harvard, Stanford folks. And I raised $2 million for them from Hummer Winblad, my, one of my former VCs. They were doing ipv6 address management, and they are just too early. You know, you’re gonna you can 1918 space, a lot of ipv4 addresses and just, it wasn’t a huge problem yet, for a lot of major companies. And he kind of drifted into survival status. Because of that. That’s a good point.
Taehoon
It goes into the thing. That’s usually it’s the 80% of time. The mistake is that you’re too early.
John
My mistake as an investor is I’m too late. Right, like, Tesla stock now. Right? Let’s talk about Pixelberry, what the hell is a Pixelberry and what happened for it to be acquired? so quickly? Since we’re talking about acquisitions?
Taehoon
Yeah, Pixelberry was actually a spinoff from Nurien Software. So for Nurian, we were basically building this hyper realistic. I call it like a virtual social network system with avatars that had physics in the hair and cloth for the first time. So it was it was very realistic type of virtual world. And then we build games on top of it, like, we built the music game on top of it and things like that. But because it was so realistic, it wasn’t very accessible. Like you had to have like a high end PC to run it. Right. So but at that time, there were a lot of technologies being invented at that time that would that try to solve that problem. So Pixelberry is a spinoff from from Nurien where we try to kind of bring similar type of gameplay experiences, but on low NPCs, and on browsers and things like that. But then, when we launched it, we were kind of a little bit in the game, the gaming market was shifting to more core gaming experiences. So it wasn’t working out, basically. And so what happened is, we ended up creating a new company. But other than just letting everything kind of die. We ended up purchasing some of the assets that was created in Pixelberry, which was much better for the investors and Pixelberry than just letting it die out.
John
I’m an advisor for a startup called Juice Labs, and they’re virtualizing GPUs and today I just got an incredible demo that blew me away they showed me one of the co founders playing Doom on a cheap laptop computer because the GPUs on another device away. And I think the main question for them will be if they’re, you know, too early with a virtualization technology like this. So that’s interesting that you guys spun out Pixelberry, at your current company and nWay that I can get back to nWay, you have over 10 major VC firms? Is this a pain in the ass? Like, how many VCs do you have on your board?
Taehoon
Having a lot of investors and VCs is not really a pain in the ass, you ended up getting there over time. So usually, you create a new kind of template, and you update everybody the same way. So it’s not really that painful, and they’re all kind of they’re all very similar in terms of what they’re looking for. But what’s painful is like, if you have a large board, then it starts to become very painful. So I would advise any kind of startup CEOs to try to have a small board possible. And there’s two reasons for this one is, scheduling is a nightmare if you have a large board, because everybody is so busy. And then second, I don’t know about it’s a human characteristic, where if you’re with like three people, it’s people a lot more engaged, then when you’re in a meeting with like, 10 people. So in a large meetings, people tend to be more, they don’t mean it, they’re like, you know, they’re more handed, they’re not engaged as much. So they’re not, it’s not actually not that effective. And then also, like anyone you add to the board, it kind of, it’s all about chemistry, right? You have to want to have a good chemistry and have good culture in your board. Every time you ask somebody that kind of you don’t know what you’re gonna get. So as long as the board is small, and I think that’s, that’s fine.
John
So I’ve always imagined that super large boards, would have people kind of push you in different directions? Like I, I remember, a board member asked me once? Can you get a halo effect on your products? And I thought, what if we we have one fucking product? Like? Are you confusing us with another portfolio company? Because we have one fucking product? It’s a SaaS product. Like, this is not Apple, there’s no halo effect. I don’t know if you just heard that buzzword in your car and got excited. But like, you’re grilling me over this. Right. Okay, but you can manage 10? I I don’t know if I could do that. I would like to think I could but I don’t know.
Taehoon
Well, not all of them was on the board. And my board was pretty small. I didn’t give the board seat to all the VCs.
John
How do you handle kind of being in control? You know, in my first startup I was asked to resign as the CEO so that they could get a professional CEO, who happened to be a white guy. And I think we spoke about this before, I’m not saying it was racist. At all.
John
I’m just saying that, you know, in the very early 2000s, and late 90s, Silicon Valley yet wasn’t comfortable with a lot of Indian American or Asian American CEOs, you know, raising a bunch of money and running a multi million dollar enterprise that they thought you could take public. Do you have any advice for first time founders when choosing a neutral board member? Right? Because that’s kind of one of the first big board decisions that young founders make, right? You raise 5-10 million dollars, then your VC is on your board, and they say, you know what, we need a neutral board member? Do you have any advice for founders going through this the first time?
Taehoon
Advice that I usually give my founders, because first time founders and I did the same thing, but they tend to over emphasize on the valuation. Okay, the valuations and most important thing I’m just gonna go with, I’m gonna go with the term sheet that gives me the highest valuation. That’s like, right valuation, and their ego is like almost like that same thing. But it’s, the valuation is actually not as important. What’s important is making the company successful. And your chance of making the company successful is much greater, if you have good chemistry with your investors. And so the advice I give to my to some two founders is if you’re able to, and usually you have to do this, like you have to get into a competitive situation like, if you only get one term sheet, usually that term sheet will go away, getting cold feet, like why am I the only one you have? Right? So the most important is kind of at least two term sheets. More term sheets beget more term sheets, right? It’s like they breed. So try to get to a point where you have this competitive environment, having more and more terms competing. Once you do that, don’t just go to the highest, don’t just negotiate or kind of optimize for the highest valuation. Valuation and control is almost the same thing. You’re giving up equity, for giving them some control. So negotiate, not for valuation, but for the control of a company. So small board, you know, they’re gonna have all these terms in the agreement and things like, okay, you have to get our approval on hiring or compensation, you know, boards, we want two boards like, whatever, try to negotiate all that stuff, so that you take control of the board, that you decide the compensation, you decide who you hire, but they’re gonna want some control, like, they’re gonna make sure that the CEOs compensation is done by compensation committee. And maybe that’s, you know, the C level executives, you have to get their approval. But for anything else, like the founder should try to have control over that. And if you do, then you can also block yourself from getting in place as well, which is, which is what actually happens pretty often.
John
I think one of the secrets or the ugly truths of startups that raise a lot of money is that many, many times the founders get fired, right? I think one of the things that really hurt me was when my first startup finally IPOwed, they didn’t fucking invite me. And I saw them. I saw the board of Uber do the same thing to Travis at Uber, right? He had no, no his grits, you know, and his vision, and his toughness and all of that. He had built this wonderful company that had made board members and investors, you know, incredibly wealthy, and yet, they didn’t invite him to New York. So, I got to really echo and thank you for this one piece of advice. I tell founders the same thing. Like, don’t ever step off the board until you’re absolutely certain what your personal outcome is going to be, what your personal outcome is going to be, and you’re absolutely certain about that.
John
Moving on to a more joyful topic. Recently, more and more professional actors have been appearing in video games like Keanu Reeves and Cyberpunk, which I am like, counting the days. That’s where it all started, baby. And Norman Ritas is in Death Stranding? Yeah, how far away? Do you think Hollywood is from merging with a game industry where it’s gonna be a rite of passage for a Lister, to also be in a major game production.
Taehoon
I think it’s already happening. More and more game companies are now starting up in LA because of these reasons. If you look at a lot of games that are coming out now, you mentioned this trending but you know, there’s Last of Us too, they’re all mocap with real actor storytelling is similar to photography is now on par with movies, and TV with release the PlayStation 5, Xbox series X, on your engine five, it’s gonna get even closer. And interesting things happening as well, where, because of the, the bridge of duality and animation. And graphics is getting so incredibly realistic. You’re going to we’re going to start having these characters that are created from games that almost behave like actors and actors in real life. What I mean by that is like, you have this character in the game but so many people love this character that this character can step off that game. It can exist in Instagram can exist in YouTube, can have their own social accounts, exist in other movies exist in other games. So one of the predictions I have is like you’re gonna start seeing talent agencies, their own talents that are virtual, you never get old. They never give you problems. You own everything.
John
I am a big fan of the actor Jon Bernal and I just killed his ass and Ghost Recon. It was awesome. It was awesome. I blew way with a shotgun, it was great. Let me ask our final four questions, and they’re really career questions for young developers. How much harder is it for you as a hiring manager to find good developers for the game industry? Or is that not the right question? Do young developers that you will hire, do they have the same skills as a typical web app developer? Or are you looking for something different?
Taehoon
It depends on whether you’re whether you’re looking for programmers, artists, or game designers. From my experience, it’s typically harder to find good game designers. And the reason is because it’s hard, harder to get them. But artists, you can see how they draw with programmers, you can see in the test in front of them. But with game designers, it’s much harder. Also, back end engineers, the server engineers, they’re also super hard to define. And that’s the reason because the reason for that is because every service, whether it’s gaming, or apps, or websites, they all need, again, engineers, so they’re much more in demand. But you know, cloud engineers, animator, or kind of professionals that are very heavily tied to the gaming industry, and they also in their authentic craft, because they love games, and because they love industry. So for those, it’s much, much easier to define an hire.
John
Do you think new game developers should start with a mobile game first? Because it’s easier? Is it easier?
Taehoon
No, I think mobile is super competitive. And for mobile free to play, you have to have a pretty sizable team to do live ops and do quick updates. I think by far the easiest platform for your first game would be PC flash game.
John
Now interesting. That’s not the answer I was expecting. Okay. What’s your view about preorders, DLC? Microtransactions, loot boxes? Are they unnecessary evil? This is a question from our CTO at JetBridge.
Taehoon
There’s not anything wrong with them. You just have to design them right. You know, Fortnight has done an amazing job of kind of innovating their with their invented this whole battle pass system which is awesome. And loot boxes, which is most an even more hardcore for Asian Games those tend to be almost a little bit too gambling like that. So that that’s something that the game industry, I think is especially in the western market is trying to steer away from. And game industry as a whole here is a little bit different from Asia, where pay to winning more acceptable in Asia. Over here, people puke all over it. So I think there’s some innovation happening right now, to figure out how to monetize better. There’s some blockchain technologies also being developed to help with gifts. So that the gamers can also monetize off of the games, not only the publishers, but there’s a lot of thing that’s that’s happening here and I think things are going to improve significantly over time.
John
Last question snd we call this the Peter Thiel question, because we stole this from the great Peter Thiel. What’s the one thing you believe about the gaming industry today that most VCs don’t know or are wrong about, including your board members?
Taehoon
Streaming, there has been a lot of startups in the streaming ception sector, like onlive KK, and then now with a cloud and Stadia from from from Google. And everybody’s kind of saying, it’s not going to work, because Google Stadia is also not getting that good of attraction online, kind of failed. And so people are kind of writing it off saying that streaming is not going to work in the industry, and also I think a lot of VCs are thinking that way. But I think streaming isn’t going to work overtime. Just a little bit early. The experiences is great if you’re playing if you’re using your TV with the roghtwhite setup, but I think it can get to a point where you can actually designing game experiences that are brand new, and can only happen in a streaming environment. Once that happens, I think gamers are going to flock to streaming and streaming is going to take off
John
Interesting. Can you give me a keystone example of that like?
Taehoon
Yeah, like right now on Stadia and because there hasn’t been enough time games on streaming are saying games and you can actually play on PlayStation just on streaming. But because of because it’s streaming and because the GPU and CPU calculation is being done, not locally. But on servers. A lot of these restrictions around game design is lifted. For instance, usually, when you play a game, you play with three or four people, or for advanced games like fortnight you can play with hundred people. But as soon as you lift that local thing, local limitation off, you can start having thousands of people in one game arena. So maybe there will be a game where that took a castle siege that game or like a war with thousands of players battling in real time. That’s something that has never happened before. So that’s like a game that creates experiences where people have never seen it or played before. Those type of games don’t even need marketing budget. It just goes virally. And people are curious and they want to try it. If the game is good enough to have the player stick around, that’s when you have like a Fortnight effect. Or recently the Fall Guys effect, have you ever play Fall Guys? It’s like a game show. It’s crazy. It’s going crazy virally. But only because it’s a new experience. There has never been anything like that in the market. So that’s one example. Another example is like being able to see what my other teammates like, say, you, me and three other guys on the same team but I can actually see your screen you can see my screen, maybe there’s a smaller screen in your in your screen. And you’re gonna have a much more tactical cooperation between people. That can’t happen on mobile devices, because the local device not powerful enough to render five, six different games are happening. Another example is being seen another person’s gameplay and like hopping right in, right? Because like if I don’t have the game, how can I play it? Right? Good for places now have to have a discraft. I’ve downloaded for hours, but was streaming like I can see you play, I can join immediately. And so you can have these gameplay experiences where the audience and the players are interacting, that affects the gameplay. And something like that also is possible. So if you enable things that’s not possible now, that’s only possible streaming and create game design around that, like Nintendo does is the best, right? They created hardware. Like when they first came out with the Wii and a controller that that tracks its movement, they create a gaming experience that’s only possible on that hardware. And that has never had before existed. So that’s kind of the key. I think once there are content like that start popping up on stream, that’s when it’s going to start to work.
John
So Taehoon Kim sees a future where a game can be published, basically, on the internet, then it could go viral. Right? I guess you’re saying 100X or 1000X easier than games do today.
Taehoon
What do you mean under that?
John
Well, for example, as I said, I’m a gamer I stuck in a Moto GP disc in my Xbox and the disc is scratched I gotta buy another disc. You imagine a future where I can go to this channel somewhere on my TV or even through some game box that I have and I can just serve thousands of potential games and just drop right in.
Taehoon
Yeah, well it’s actually already happening with with video. But they’re not kind of getting the traction right now they need so people are inviting it off their thing that’s not gonna work but I think streaming.
John
So let me ask a follow up to our last question, what is the technical leap? What is the technical leap that has to happen for people on Reddit to stop complaining about Stadia and actually grow its user base?
Taehoon
I don’t think it’s the technical leap. I think they need to have an inclusive game. That’s only possible on Stadia that is so good. That even with technical problems that people are still going gaga over it when Fortnight first launched, you know, they had a lot of technical problems because it was scaling so it was growing so fast, they couldn’t scale fast enough. Same thing with Fall Guys, that’s hot right now. They’re having all these connection problems, or there’s so many technical problems. People don’t care, because the game is still good, because they want to play. So it’s actually a content problem, rather than an interesting issue.
John
So Stadia needs a Halo.
Taehoon
Yeah, Halo was on Xbox. They need their own title. It’s only on Stadia. And that creates a gaming experience only possible on streaming.
John
Interesting. That is not the answer. I thought I would get Taehoon Kim, thank you so much. given up quite a few answers I didn’t expect. We really loved having you on our podcast and I know our audience is going to find it super helpful. Thank you.
Taehoon
It was a pleasure. Thanks for inviting me.