Kyu Lee interview — Why Com2Us Holdings pivoted into blockchain video games

Kyu Lee, president of Com2Us USA, has been making cellular video games like Summoners Conflict for a few years. However a number of years in the past, the entire firm began exploring making video games utilizing blockchain and nonfungible tokens (NFTs).

In 2020, the Seoul-based firm invested in Coinone, a giant cryptocurrency change in South Korea, and it invested in Wysiwyg Studio. It regarded for companions and invested in Animoca Manufacturers, Sandbox, Upland, and Legendary Video games. It additionally rebranded itself globally from Gamevil to Com2Us Holdings.

And now the corporate is pivoting in a significant means, going past free-to-play cellular video games which have introduced it nice prosperity and partnerships with manufacturers just like the NBA. Its complete workers is diving into NFT video games and different blockchain expertise, and it’ll give attention to them in the identical means that it centered on the transition to free-to-play mobiel video games a few years in the past.

This makes Com2Us one of many greatest cellular sport corporations to maneuver into NFT video games. Established in 1998 and headquartered in South Korea, Com2uS turned a subsidiary of cellular sport writer Gamevil in 2013 (and now the entire firm is Com2Us Holdings). Com2Us’ Summoners Conflict has greater than 100 million downloads and $2 billion in gross sales.

Com2Us video games coming quickly embrace Chromatic Soul: AFK, Kritika: the White Knights, Challenge MR , and Summoners Conflict: Chronicles. Blockchain video games coming quickly embrace Baseball Superstars, World of Zenonia, and The Nice Service provider.

I caughter up with Lee about this pivot and quizzed him about it. Right here’s an edited transcript of our interview.

GamesBeat: It seems like a giant pivot for Gamevil and Com2Us. Are you able to speak concerning the context and the background?

Kyu Lee: In 2020 we began investing in Coinone. Coinone is the third largest crypto change in South Korea. We have been at all times usually within the blockchain house, however we didn’t have any motion objects, so to talk. We knew that there was quite a lot of traction there. We knew we would have liked to check it a bit extra. We determined to spend money on an change. That may be one of the simplest ways to begin studying.

After that, NBA Prime Shot got here round. As a result of we’re additionally very concerned within the sports activities collectible market in some methods – we now have 4 video games with Main League Baseball, and we even have a sport with the NBA – we have been making an attempt to determine NFTs. We have been pondering this was going to be mass market. It’s a giant sign {that a} prime model just like the NBA was getting on prime of that.

Once we noticed the numbers arising from Axie Infinity, we performed the sport. We noticed that there’s a lot alternative. There are such a lot of hurdles within the sport that it was unbelievable, nevertheless it was additionally unbelievable that it was producing that a lot revenue, and so many individuals have been taking part in. That’s what acquired us into it. We began speaking to our inner manufacturing groups to make this factor actual. We began getting ready, researching the video games. Our CEO, Yong Kuk Lee, has quite a lot of curiosity on this house. He’s at all times been excited about the metaverse and all of that.

What occurred within the meantime, we acquired an organization referred to as Wysiwyg Studios. Wysiwyg Studios is a publicly listed South Korean firm. They’re initially a VFX studio. They’ve executed quite a lot of issues within the metaverse preparation space, so to talk. However after we acquired them, we did it as a result of we thought Netflix was the brand new app retailer for all the TV manufacturing corporations in South Korea. There’s a lot nice expertise in South Korea, however they have been solely distributing their content material by way of the native TV service suppliers. With Netflix, there’s extra room for–there’s a giant firm referred to as Studio Dragon that does quite a lot of distribution by way of Netflix. We thought there was far more play to be executed, so we thought we must always purchase Wysiwyg and roll up quite a lot of TV manufacturing studios beneath it.

There’s quite a lot of synergies between the leisure enterprise, the webtoons, the IP creation that they’re doing. They at all times wished to associate with a gaming firm and we at all times wished to develop our IP. We’ve executed that by way of our partnership with Skybound, however how can we do extra of this? That was the imaginative and prescient we had. All of these items pointed in a course the place we needed to go Web3. We needed to do metaverse. We needed to do blockchain gaming. We needed to do NFTs. That’s how we ended up investing in Sweet.com. Sweet.com has the unique rights for Main League Baseball NFTs. We went in with Perception and Softbank. We put in $10 million of funding there.

Whereas our firm was transferring its manufacturing groups over, on the lookout for the suitable blockchain and the suitable companions, we thought that cash might transfer quicker. We began speaking to all the prime gamers within the blockchain gaming and metaverse house. That’s how we ended up investing in Animoca Manufacturers, Sandbox, Upland, and Legendary Video games. These have been the 4 investments that we additionally did. These have been all fairly late-stage, already established corporations, nevertheless it was an effective way to get our foot in and perceive what’s happening, construct relationships throughout the ecosystem, and in addition promote that we’re not solely only a gaming firm, however we now have ambitions to change into a blockchain gaming firm too.

I believe it labored out fairly nicely. After we began doing these investments–all of those have been oversubscribed rounds, however I believe everybody was blissful to have a gaming firm. We’re not the most important gaming firm on the planet, however we’re a longtime gaming firm approaching their cap desk. They have been very welcoming of our entry into the house. All of them made room for us to speculate. We’re very blissful about that. Now we’re much more corporations to spend money on, even at earlier levels. We need to change into like what Animoca is doing. That appears actually cool.

Our strategy inside–we considered quite a lot of completely different chains. There are such a lot of nice chains and options that we might have adopted. Personally, I like what Solana is doing and the way they’re build up an ecosystem that’s going to be superior to run video games, due to the velocity and all that. However we determined to work with Terra. Terra being a South Korean firm and such a longtime firm within the crypto house–they’ve a tremendous ecosystem. I used to be fairly shocked that they weren’t as well-known within the west. It looks like even throughout the previous few months, although, they’ve been gaining a lot traction.

Once you’re solely doing a stablecoin play or a DeFi play, it doesn’t achieve quite a lot of traction among the many app builders or the leisure house, the place we’re. After they introduced their good contracts I’m seeing so many initiatives being constructed on Terra. Simply studying by way of the lots of of pages of paperwork in English is a troublesome one to swallow for our growth group. Having a South Korean group–Do Kwan, the CEO, is superb. Having his group to assist us was an ideal match. We’re very proud of the connection that we now have with Terra. We’re constructing an NFT market that’s going to have Okay-pop stars and all of the leisure manufacturers we now have. It’s going to be about gaming too. We’re additionally going to make use of them as our blockchain associate. We’re going to construct wallets collectively and all the things else we have to service our video games.

GamesBeat: It looks like about as full a pivot as you would do. Are you planning to nonetheless do non-NFT, non-blockchain cellular video games?

Lee: There are nonetheless quite a lot of restrictions on the place we are able to service our video games and the place we are able to’t. The very fascinating factor that I discovered, although, is that after you step into this aspect of the world, the opposite aspect appears to be like so stale and boring. I’ve been telling my associates–all of those individuals, after they step into this new world, everyone talks about the identical factor. This appears like the way it felt when cellular was beginning. Simply having that really feel of enjoyment and studying all the things that you could. Ensuring that you simply’re on the beat on a regular basis. That in itself is so rewarding.

We nonetheless have quite a lot of merchandise which are going to launch as scheduled. However I believe quite a lot of our manufacturing heads have gotten far more open-minded about transferring over. They’ve been launching sport after sport. They in all probability wanted one thing new like this.

GamesBeat: The builders themselves are serious about going this course, then?

Lee: Sure, sure. This empowers you in quite a lot of methods. I solely observed how–when the App Retailer first got here round, I believed, “Oh, let’s have a digital forex that may run throughout all of our video games. Let’s make a market the place the customers should purchase and promote.” We had these concepts. However by following the principles, we contained ourselves into a hard and fast mind-set. With all of those blockchain applied sciences enabling sport builders, you notice, “Oh, I forgot that we might try this!” We run into so a lot of these moments. It’s one other useful gizmo for sport builders to specific themselves. If you wish to use that instrument, we need to encourage that.

Clearly there are going to be quite a lot of video games that work higher within the Web2 world. However there are going to be tons of latest sorts of video games that we’ll see within the Web3 world.

GamesBeat: Is there a sure share of the corporate that’s devoted to engaged on this, or is mainly everybody engaged on it?

Lee: At this stage, it’s everybody. The order is coming from the highest in our firm. Everybody goes to undergo the tutorial curve. We began out having a small group, however now that there are such a lot of completely different initiatives concerned–it’s not something secret, and it’s not only one or two initiatives. We’ve already introduced round 10 initiatives for the brand new 12 months. We pivoted quite a lot of the video games we have been planning to launch this 12 months or early subsequent 12 months, and we’re repositioning them in order that they’ve a play-to-earn or NFT side.

When you keep in mind when in-app purchases first got here out on the App Retailer, I don’t suppose each sport impulsively went over to free-to-play, following the true spirit of free-to-play. There have been some restricted adoption efforts. I believe we’ll undergo that very same course of. Not all the things could also be absolutely baked in. We’ll study lots. We’ll fail lots, however at the least from a gaming perspective, I believe we’re bringing within the best-looking video games. All the video games I’ve checked out up to now, they’re good, however they’re tremendous excessive manufacturing high quality. Loads of the video games we’re releasing even within the subsequent 12 months have been in growth for 4 or 5 years.

GamesBeat: Did you see the Ubisoft announcement about NFTs in Ghost Recon Breakpoint?

Lee: I noticed the hyperlink.

GamesBeat: It’s the tiniest of steps. I believe it’s meant to coach the market and get individuals to simply accept it. It’s a really strictly managed distribution to individuals who performed quite a lot of the Ghost Recon sport. And even those that purchase in on the secondary market need to have performed the sport as nicely. They’re not promoting the NFTs. They’re being as cautious as you possibly can going into this. [Ubisoft pulled down a video due to lots of negative feedback].

Lee: There’s going to be quite a lot of child steps. However these video games are going to look a lot better. Loads of the newer initiatives which are ranging from the bottom up in our studios, they’ll in all probability strive to consider how they will undertake the expertise as a lot as attainable. However these video games will take one other two, three, 4, nevertheless a few years. Who is aware of? There will likely be so many new traits.

Proper now we noticed Axie Infinity. Everyone’s pondering in that mentality. In South Korea there was a sport referred to as Mir4, made by Wemade. That sport was utterly the other. They switched a free-to-play sport and simply added a small quantity of play-to-earn elements. Now impulsively individuals are realizing you are able to do this. There’s going to be quite a lot of swings, even inside our manufacturing groups, round how they’re going to design these new sorts of economies. That’s how I see it.

GamesBeat: Have you ever seen any resistance from players? I do know Ubisoft has run into a few of that immediately. It looks like the extra hardcore players, they affiliate this with issues like loot packing containers and scams and aggressive monetization.

Lee: We haven’t seen that a lot from our customers but. I’ve seen it round different video games. Even Cookie Run, at one in every of our sister sport corporations, they introduced they have been going to do Cookie Run NFTs and so they confronted an enormous backlash. We’ll need to see. The identical factor occurred as everybody was transferring over to free-to-play and utilizing issues like loot packing containers. It’s going to require quite a lot of schooling. We’re filling in a spot, I believe, and we’re going to offer far more worth to our customers on the identical time.

Even crypto itself nonetheless has quite a lot of damaging associations round it, whether or not it’s environmental affect or cash laundering and all of that. However it’s such a strong instrument. We simply need to attempt to use it the suitable means.

GamesBeat: How quickly are a few of these issues going to reach? Are you 2022?

Lee: I don’t know what’s going to come back first. Our schedules at all times change. A lot of the video games are going to come back across the center of subsequent 12 months, although.

GamesBeat: Anything you’d like to say immediately?

Lee: Loads of the time we really feel like we’re transferring in quick ahead. We need to be in a number one place. Which will imply we take the bullets. However we need to pave the best way. We’re very enthusiastic about this new alternative. It’s going to be enjoyable.