Anuj Tandon has joined Bitkraft Ventures, a seed-stage investor for interactive media and video games, as companion centered on the fast-growing Indian sport market.
Tandon brings almost 15 years of expertise as a gaming entrepreneur, government, and investor in India to Bitkraft’s workforce, establishing the enterprise capital agency’s footprint within the area. That may be a giant deal, as a single companion can do a number of offers to kick off investments and construct a sport ecosystem.
India’s on-line gaming market is without doubt one of the quickest rising on this planet as per the most recent report from PwC, projecting to develop at 14.5% between 2023 and 2028, almost double gaming’s world progress. Tandon’s expansive community in India offers Bitkraft a strategic opening into this quickly increasing market.
As a Bitkraft companion, Tandon will search to spend money on modern Indian gaming and interactive media firms, with a selected give attention to AI, video games tech, and content material—making the interactive media VC agency one of many first world early-stage funding platforms within the nation.
Tandon’s expertise consists of efficiently main Krafton’s investments in India and the Center East/North Africa, bringing the billion greenback leisure model Yoozoo Video games to the area, and extra. Earlier than becoming a member of Bitkraft, Tandon was the CEO of Gaming at JetSynthesys, India’s main digital
conglomerate the place he managed all their gaming belongings.
India has been a software program growth powerhouse for fairly a while already with a deep pool of technical expertise. The Artistic and Leisure trade has been selecting up visibly over the past decade and the Indian gaming trade revenues are projected to double, reaching $7.94 billion by 2028 (Supply: PwC).
A second era of video games entrepreneurs is forming and can got down to construct internationally profitable firms. With Tandon’s experience, Bitkraft believes they are going to be geared up to assist the nation’s modern firms and supply the sources they should obtain their objectives on a world scale.
“Now we have made a number of investments in India already, however our ambition is to extend our exercise and capital deployment within the nation visibly going ahead. That is the place Anuj’s expertise and community within the Indian video games and leisure trade is essential to us and our potential to determine and companion with probably the most excellent entrepreneurs in India,” mentioned Bitkraft founding common companion, Jens Hilgers, in a press release. “It’s extra than simply having an individual on the bottom; it’s the deep understanding of the market, the actors, the native preferences and dynamics from individuals to design and product to financing.”
At Krafton, Tandon constructed the corporate’s India and MENA technique, investing greater than $135 million in excessive progress startups resembling FRND, Nautilus Cellular, Nodwin, KukuFM and extra, in lower than two years. Bitkraft has greater than 130 portfolio firms and it has $1.05 billion below administration. Hilgers based the agency in 2016. Now it has six funds. I interviewed Tandon just lately.
Right here’s an edited transcript of our interview.
GamesBeat: What led to this transformation for you?
Anuj Tandon: I’ve been within the sport trade for the final 14 years now. I began off at an organization referred to as Rolocule in India. I used to be a co-founder. That was again in 2010, when gaming was easier. Paid video games. There was no free-to-play on the time. We made some very cool video games. The corporate was finally acquired by Dream11, which is a fantasy gaming large in India. Then I labored for Nazara for a yr, constructing a sport publishing enterprise.
After that I labored for a Chinese language gaming firm referred to as Yoozoo Video games, at their India workplace. Yoozoo was a fairly first rate firm, one of many first Chinese language firms to enter the Indian market. I labored there for 4 and a half years, earlier than the entire India-China geopolitical factor occurred. Then I went to Krafton. Krafton is the maker of PUBG. I joined in a distinct function, as an investor. I deployed greater than $135 million for them in new age media and leisure, interactive media, and gaming. That was in India and the Center East. My final gig was as an working companion for various gaming efforts at an Indian firm, JetSynthesys.
That’s the background. Operator, investor, and entrepreneur. Bitkraft occurred as a result of I actually really feel we’re on the proper time in India. I’ve seen the journey of the Indian gaming market from inside and outdoors the trenches. It’s a really attention-grabbing market. Now it’s beginning to present some indicators of monetization, of mass person penetration yielding precise robust revenues for sure video games. The second era of gaming entrepreneurs is coming in. It’s a nascent market nonetheless. It’s immature by way of gaming expertise. However we’re seeing individuals who have executed some exits. They’ve some liquidity. They need to construct sport firms. It’s an attention-grabbing time to enter the market.
GamesBeat: I wrote just lately about Lumikai’s report. They had been predicting that India’s gaming market was going to develop from $3.8 billion to $9.2 billion by 2029.
Tandon: Everybody has their totally different predictions. PWC is predicting it’ll go from three to eight. There’s an optimism concerning the market that I share. However greater than that, it’s one of many few markets the place there’s nonetheless progress occurring. There’s political stability. There’s a large IPO marketplace for tech startups. India was one of many highest IPO markets final yr. Greater than 25 tech startups are planning to IPO subsequent yr. There’s a number of liquidity occurring within the startup ecosystem, which has been constructing for the final 15 years. You’re beginning to see the flywheel transferring – investments, liquidity, exit.
I’d place it as much like what occurred in 2008 to 2012 in China. There was just one publicly listed gaming firm, Shanda Video games. In India there’s Nazara. Then a bunch of IPOs like Tencent, Yoozoo, Netease. All these guys went public. That’s the thrilling a part of all of this.
GamesBeat: There’s loads of room for extra enterprise firms in addition to somebody like Lumikai.
Tandon: The important thing differentiator is–gaming in itself is a world enterprise. Content material from any nation can cross borders, be worldwide, and discover customers all over the place. I’ve been an entrepreneur myself. I raised funds in 2012 for gaming in India. The most important problem I’ve seen for startups is an absence of a peer community that’s extra world, an absence of a mentor community that’s extra world. India is a really immature gaming ecosystem. “Immature” is perhaps the flawed phrase. It’s very younger. Folks solely began taking part in video games in 2016. There was no console or PC cycle on any significant scale. Entrepreneurs constructing proper now are making errors that individuals within the western and jap markets which have already made and discovered from.
When your entrepreneurs need to do new issues and construct new issues, having a peer community that’s extra world, a powerful mentor community, that’s necessary. That’s why I feel a world fund makes a lot extra of a distinction within the lives of those second-generation founders that need to construct world gaming firms from Indian gaming firms.
GamesBeat: How did you get in contact with Bitkraft? Had they been taking a look at the marketplace for a while? What had been the circumstances that led them to get ?
Tandon: In my Krafton function, I had the gaming platform to speculate out there, construct a technique, a thesis, all of that. The portfolio was fairly superior. Type of a self-plug there. But it surely’s a really first rate portfolio. That platform gave me a chance to community with lots of people as properly. Bitkraft already has 4 portfolio firms with out even having a devoted technique to date. That’s why they acquired in contact with me. I met Jens this yr at GDC. We began having discussions about technique. It’s been a decently lengthy technique of figuring out them. They’ve been monitoring the market, monitoring the individuals who’ve been out there. There are only a few people who find themselves each operators and traders in gaming and interactive media in India. Only a few individuals have that native data.
GamesBeat: Was there an expectation you had, that this was transferring in parallel to one thing like China 10 or 15 years in the past?
Tandon: I labored in a Chinese language firm very intently with the founders there at Yoozoo. You already know Lin Qi, God relaxation his soul. He was the founding father of Yoozoo. He died in 2020, sadly. It was a giant scandal within the Chinese language sport trade. However that gave me a entrance row view of how shopper gaming startups and gaming and interactive media scaled in China. What was the playbook? How did they do publishing? How did they do sport growth? How do you scale dwell streaming and esports?
My view is, sure, we’re lastly beginning to see the essential constructing blocks fall into place. For six to eight years it was all about customers. In the event you wished, as a shopper startup, to develop in India, it was all about DAU and MAU. However now you’re lastly beginning to see individuals speak about paying customers, about common income per person. These at the moment are making vital numbers. When you might have 450 million smartphone avid gamers within the nation, even in the event you solely have 1-2% conversion, that may be a fairly large quantity. Even when the ARPPU is barely decrease, you possibly can generate an honest enterprise.
We’re following the identical footsteps, however I feel the ecosystem will likely be barely totally different than China. Our person base is extra westernized, no less than on the prime. The center of the funnel goes to be extra much like China by way of their consumption habits and paying habits.
GamesBeat: What do you see on the alternative in made for India video games versus Indian firms making world video games?
Tandon: I take into consideration two issues. Indian content material being exported in gaming, that’s a no brainer. International cultural shifts occur each few years. Korean content material, Japanese content material, some stick and a few don’t. Indian content material goes to be massively produced for a world viewers. There’s a large Indian diaspora in a number of nations that can eat Indian content material and gaming.
India to India, already we’re seeing some indicators. In the event you have a look at the highest MAU and DAU video games, they’re native board video games, native card video games that persons are taking part in. That’s the primary signal that Indians are extra interested by taking part in extra native content material than world. In fact, the funds and class of sport growth remains to be reaching. I’m bullish on each. I feel as a direct tactical alternative, India to world will likely be a greater alternative. However actually India to India makes a lot sense. There’s a number of native tales. There’s a historical past to it. When tv began in India, when animation began in India, world content material dominated the Indian scene. Slowly however absolutely, although, Indian content material began to dominate. That’s occurred with different media and leisure, and I feel it’ll occur with gaming as properly.
GamesBeat: What classes do you want to concentrate to so far as the potential for Bitkraft investments?
Tandon: We’ll nonetheless observe our core thesis. You will have content material. You will have interactive media. Utilized sport mechanics, infrastructure instruments, and expertise for gaming. We’re not transferring from our 4 core pillars of investments we do. It will likely be much like what we already do globally. However there will likely be distinctive native options and native firms that we’ll discover on this house.
GamesBeat: You talked about a number of investments already. Is there a fund that’s largely related to this? Has a few of that began to get deployed already? Or are you coming in recent, not having executed an funding but?
Tandon: As a platform Bitkraft has already invested in India via its varied funds. There are three to 4 firms that we have already got, and which can be doing very properly. Going ahead, there are going to be a number of extra firms. The precise technique that can play out remains to be a piece in progress. The entire level of hiring a neighborhood companion is to give attention to that space extra, and in different rising markets as properly, just like the Center East.
GamesBeat: Does Bitkraft have extra native companions around the globe, or are you one of many first?
Tandon: Now we have a really various workforce geographically. We’re positioned all over the place. Now we have a principal in Singapore taking a look at that space. We beforehand had a companion in Korea. However at a companion degree that is the primary, so far as I do know, the primary strategic give attention to a market like this that deserves particular consideration. That is the primary time we’re localizing in India.
GamesBeat: Do you see different game-focused enterprise capital funds doing this, discovering companions in India or in any other case investing in Indian sport firms?
Tandon: There are different giant gaming funds that even have a number of Indian offers. However most of their sourcing community is thru native VCs, which would not have thesis-based gaming-focused investing. There’s curiosity, however there’s no consistency or give attention to this particular space. For my part, this can be a large validation for the market. It reveals there’s a number of potential, that a big fund like Bitkraft has a devoted technique for rising markets and India.
GamesBeat: I just lately spoke to Dino Ying from VSPO and Hero Esports. He talked about investing in esports in China a very long time in the past, and the way lengthy a highway that’s been. They finally discovered recognition from the Saudis. The Saudis made a giant funding. That made it way more world as an effort. He talked about how he needed to be affected person for a few years, enduring a number of losses earlier than it will definitely turned a greater enterprise. Is that one thing that you simply foresee Indian firms nonetheless having to cope with, particularly within the esports class? Is there an extended highway to stay up for nonetheless?
Tandon: Particularly for esports–certainly one of my first investments at Krafton was Nodwin Gaming. Additionally they acquired funding from Sony and Nazara. That’s one firm that’s worthwhile in esports in India. It’s tripled in valuation over the past three years. It’s scaling very quick. Sure, you must be affected person in sure genres and subgenres or sectors. Endurance issues. However the strategic alternative of this market, via an investor lens, could be very excessive. There are firms which can be going to go public, and so they’ll purchase startups for diversification for no matter purpose. There’s a number of strategic curiosity out there to increase. From a fund perspective that’s a fantastic place to be. Even when there’s money movement or profitability points in sure sectors, they’re good acquisition targets. We’ve seen that with VSPO.
GamesBeat: Do you might have some other feedback on explicit sorts of firms which can be engaging, or areas inside India the place you would possibly focus?
Tandon: India is a big nation by way of space, however the principle facilities of entrepreneurship for a lot of the tech startups are in three to 4 areas: Bangalore, the Mumbai cluster that features Pune, New Delhi, and to some extent Hyderabad and the remainder of the smaller cities. These are the place a lot of the startups are geographically. However a number of Indian founders are already aspirational so far as reaching out to world traders. The data that worldwide traders carry to founders has helped with their worldwide growth. The profile is manner higher than what a neighborhood enterprise capital fund would have. That’s my considering. That’s how we’ll have the ability to get a number of good high quality entrepreneurs to work with us.
GamesBeat: Have you ever recognized Jens Hilgers since earlier than coming to Bitkraft?
Tandon: In fact. We’ve interacted for 3 or 4 years. We’ve all the time stored in contact concerning the Indian market. I’ve been in contact with most world traders, as a result of each time they should perceive the market in India or the Center East–there are only a few individuals who have really executed investments in these areas and efficiently acquired studios. There’s a number of curiosity in an individual like that in these areas for knowledge-gathering and so forth. Jens has been very curious concerning the market. The time to do it’s most likely now. Two or three years in the past, it wasn’t a really engaging early stage funding market.
GamesBeat: How secure has the job market been in India? Within the U.S. and the west typically, the final 30 months have seen fixed layoffs. One consequence is that there was no scarcity of expertise out there to go to startups. Plenty of startups have been shaped by groups that had been let go. Has that occurred in India as properly? Is there one other supply of expertise that you simply discover there?
Tandon: I gave a chat on the Bitkraft Summit the place I began by saying that each time I come to the U.S. for an occasion in gaming, the information isn’t very constructive. I’m dwelling in an oasis of open optimism. Our markets have been in a progress section. We’ve seen most likely the best startup funding in gaming occurring within the final yr or two. In fact there are provide chain points with AI and so forth, that are correcting on the general trade degree. However India and the Center East are the 2 greatest progress markets for cellular gaming and gaming general. There’s a number of hiring exercise. There’s a number of funding exercise, new startup exercise. The ARPPUs are rising. It’s totally different from the opposite markets. That’s why we’re hopeful that this may stick with it.
The general sentiment is optimistic as properly. India is the fastest-growing financial system on this planet at this level. Plenty of components are contributing. The macro tailwinds are very robust.
GamesBeat: Have Indian sport firms picked up a number of expertise from the tech sector typically?
Tandon: If you consider the businesses the place individuals get their expertise, there are a number of facilities in India. Zynga has a fairly large workforce in India. To present an instance, Zynga alumni have generated greater than $600-700 million in enterprise worth, simply in new gaming startups they’ve created within the final 5 to 6 years. These are money exits. PlaySimple, Moonfrog, these two firms had been acquired by MTG and Stillfront. There are lots of others, in different sectors as properly, the place Zynga alumni have had an impression. Only one firm has made that impression. Then you might have EA. They’ve a workforce the place individuals have branched off into startups. Ubisoft has round 1,200 to 1,400 individuals in India. Scopely now has lots of people.
There are a number of offshore facilities that had been created the place individuals have leveled up within the worth chain and began working their very own video games. Plenty of Indian startups in gaming which can be getting funding have additionally began to rent western expertise. As you mentioned, the job scene within the western markets isn’t nice. I’ve seen a number of good high quality western expertise coming into India and constructing studios with their expertise. One in every of them is a portfolio firm of ours, LILA Video games. Joseph Kim moved to arrange a studio in Bangalore. That’s a world founder organising a workforce in Bangalore to construct video games.
