此外，一些拥有更高质量的游戏也伴随着更高的成本，就像《看门狗》等AAA级游戏便花费了6800万美元；根据育碧首席执行官Yves Guillemot的估算，面向Xbox 360和PlayStation 3的游戏所需要的平均开发预算为600万美元。而对于手机游戏来说，iOS游戏的平均预算为18万美元左右。如果是拥有更复杂图像的更高质量游戏的成本则更高。就像《真实赛车2》的成本便为200万美元。
事实上，公司并购的成功率并不像我们想象中的那么高，反而具有非常高的风险。根据一些研究以及最近Harvard Business Revies的报告，收购的失败率大约在70%至90%之间。根据几个月前发布在HBR上的另一份研究，超过60%的收购甚至会破坏股东的利益。有许多公司，甚至是一些已经获得成功的公司都在收购决定中遭遇了失败，例如在2012年收购了OMGPOP的Zynga。
What to Do before You Say Yes to an Investment or M&A Deal
by Mantin Lu
The growing trend of global game industry has been unstoppable for years, and the revenue is estimated to continue towards 2019 to reach 118.6 billion USD (1). China market, as the top revenue generator, is expanding overseas in order to create more value.
The expansion is indeed ongoing. In 2016 alone, multiple M&A deals were made by Chinese game companies: Ourpalm acquired 19.24% of Webzen (2), Tencent acquired 84.3% of Supercell (3), and Youzu, 100% of Bigpoint (4). Actually, as far back as 2011 or even earlier in 2004, some Chinese game companies had started the move of M&A strategy. Some highlighted deals including Shanda acquired Eyedentity in 2010 (5), Tencent acquired Riot and Epic in 2011 and 2012 (6) (7).
Undoubtedly, China game market is powerful and appealing. As I mentioned in my previous article, for mobile segment only, China mobile game market hits 10.0 billion USD, sharing 27.1% of the 36.9 billion USD global mobile game market (1). As the climate of the game market changes rapidly, especially mobile, it is hard to predict what type of titles would be the next big hit, or how long a title would keep standing on top.
Let’s use the situation of mobile game here, a “safer” move for game developers is, to launch multiple titles and then to review the performance metrics of each, so that they will pick the most promising ones for further maintenance. Some developers need at least ten products per year to test the market.
Furthermore, A high quality game comes with high costs: AAA games like Watch Dogs spent 68 million USD; Ubisoft CEO Yves Guillemot estimated that the average production budget for the generation of games following Xbox 360 and PlayStation 3 would be 60 million USD (8). For mobile games, on the other hand, the average cost for an iOS game is around 180,000 USD (9). Mobile games with high quality and complex graphics cost even higher. One of the examples is Real Racing 2, which costs 2 million USD (10).
Source: R-Style Lab 2016
With the appetite of getting into the promising China market, and the needs of abundant capital for continuous development, most of the western developers agree with closing the M&A or investment deals when China companies approach them.
Another fact is that, some companies outside of game industry are also acquiring game companies to expand their territory. Zhongji Holding, a Chinese listed company, acquired Jagex as its new core business (11). The western game company M&A becomes a mania that sweeps many industries in China.
As this trend continues growing, I am not one hundred percent optimistic to that phenomenon. For a game company acquires another game company, it makes sense, since that creates synergy including sharing of talents, technology knowhow and existing user base, etc. However, for non-game companies acquire game companies, that is another story.
Actually the success rate of M&A is not that high but the risk is considerably high. There are numbers behind my statement: a collated research and a recent Harvard Business Review report show that the failure rate for M&A ranges from 70% to 90% (12). In fact, more than 60% of M&A deals actually destroy shareholder value according to another study published on HBR a few months ago (13). A lot of companies, even some considered successful companies, failed in M&A moves including the M&A deal of Zynga over OMGPOP in 2012 (14).
But sure enough, I can imagine how you feel when a big company approaching you and telling you that they want to “marry” you, no, I mean, they want to acquire or invest into your business.
You might feel that your head is in the clouds, you might want to close the deal as soon as possible, and then open a champagne to celebrate with your buddies immediately. But please, calm down and really think twice before you act. Will you marry someone at the first sight? The potential impact to both your business and your personal emotion of choosing an investor is huge.
Like marriage, you can’t just marry a company just because a single reason such as it has money or it has a big name that you think you might benefit in your PR. Here is a list of things that you should keep in mind when that situation comes:
Don’t rush for any deal. Try to buy more time so that you can do due diligence. You need time to know your investor as long as possible. Same as you won’t decide to marry someone after only a few weeks of getting to know each other. Your investor will most likely work very closely with you after the investment. If it’s an M&A deal, the relationship would be even more complicated. If your potential investor is very pushy, red flag.
You should try to talk to people who have worked with that investor. Or even better, try to talk to those people who had worked with that investor and failed in the venture. People could act very nice during good times, but what matters most is how they act when the times are difficult.
Like what mentioned above, you shouldn’t agree to a deal just because of the amount of money involved or just because of the big name of the company approaches you. You should also see if there are other potential synergy between two entities (I know, I know, no one want to mention synergy now). Is there anything you can leverage with the investor’s business? Will that bring you to a new market? Will that bring you new diversified players? How about technology, tools, IP, talent, functions like customer services, QA analytics or localization?
Communicate with your potential investor as much as possible. Ask questions. Show vulnerability so that the other will open up more to you. Find out the reason why the potential investor is interested in your business, find out his or her strategic intent. Is that the game you published? The IP you created? Your game engine or development tools? Your team? The intent is critical. If only a piece of your business was interested by your potential investor, you’d better figure out what would be the future of the rest of the components of your business.
Find out how your potential investor want to cooperate with you after the deal. Would they want to have a full control of your business? Or you can remain independent? Would they want to integrate the two entities? If your potential investor is interested in your talented team, they might want to put your people to work for their product instead of yours. Of course, I think you should work with someone that you can still have say to your business, unless, you are tired with it and want to retire.
Find out how your potential investor want to deal with the cultural difference of two entities. Are they gonna integrate yours into their own spectacular culture that work great for years with their team? Or your business will stay as a separate entity that you can keep your own culture? I believe culture is something very unique to a particular team working on a particular product. Forcing a complete culture change is something that would never work out. Inevitably there would be a blending of the culture of two entities; however, I strongly recommend you to keep your own culture after the deal if possible.
When a big guy approaches you for an investment or M&A deal, there is surely something he wants to take from you. There is no need to sugarcoat it. Just that it’s essential to intensively communicate, ask essential questions, open up and share vulnerabilities to make sure the strategic intent will benefit both parties in the long run.（source：gamasutra）