The ‘Hit-Makers from Helsinki’ have posted massive revenues with a small, international team and few games. The game developer just raised $130 million on a $770 million valuation and could explode even further with new markets and a jump to Android.
The first thing you notice when you enter Supercell’s glassy Helsinki offices is the assortment of shoes strewn on the floor at the foot of a coat rack near the entrance. Finland's climate yields a lot of snow and it’s probably a good idea to leave frost-caked footwear at the door. The result is that business is conducted in socks and slippers.
Shoes or no, Supercell is the current king of mobile gaming, with its 8.5 million daily players generating $2.4 million every day, sometimes more. Supercell is already at a run-rate of more than $800 million for 2013, having earned $179 million before expenses in the first quarter alone. If Supercell plays its cards right, it could reach a billion by years end.
Oh, and one more thing—it only has two (2) games on the market right now, only available on iOS for iPads and iPhones/iPods: the social farming experience, Hay Day, and the tower defense game, Clash of Clans.
On Mondays, Supercell’s employees enjoy a catered breakfast together, with cold cuts, fruit, coffees, juices; and discuss whats happening within the company. On the black walls in the office’s main thoroughfare are written snippets of feedback the company's games have drawn from players. “I can’t get enough of Hay Day!” reads one. “My kids love to check on my barbarian horde,” reads another. “Ecelente juego muy adictivo y entretenido.”
What is the Draw?
Part of what makes Clash of Clans and Hay Day so insanely addictive is what Supercell employees like to call the “soul of the game.” This soul materializes through those small details that lead players deeper into the game, such as the charming aesthetics of game characters like sheep that overflow with wool when it’s time to sheer them or pigs that become so fat they cannot walk, indicating it’s time to harvest their meat.
According to Timur Haussila, a product lead and one of the brains behind Hay Day, the aesthetics are a big deal and, in fact, the visuals of the animals on Hay Day came first. “It has a huge impact,” he said. “Its the first thing that you see.”
Hay Day, by game developer Supercell, draws 4 million players per day, 69% of them women.
Another aspect of a game’s soul is emotion. You have to feel it, especially in a mobile game where screens are small and game play simple. Co-founder and Creative Director Mikko Kodisoja, told me that a good game should tickle a players funny-bone, incite excitement and sometimes even anger.
You can not discount the social aspect of mobile gaming as a draw. Friends and game connections can cooperate on both of Supercell’s games. “We made sure that (Hay Day) is truly social,” said game product manager Stephan Demirdjian. “It means that on our platform not only can you visit other players, but you can help them. One of the core features of the game is that you can not only produce but also sell goods to other players.” That sell with in-game money. You can use real money to buy yourself game resources and power-ups.
Clash of Clans features organized conflict among groups of players. This breeds two things: a sense of community and the fire of competition. Groups of Clash players (called “Clans”) can coordinate attacks and share resources and all are locked in deadly (well, not deadly, but it seems that way) battle against other clans and players. The need to do right by your clan and also beat adversaries drives players to spend their own money to purchase in-game power-ups and resources.
“At some point it’s not the game that will suck you in but your clan or your alliance or the other people,” says Kodisoja.
Down with Bureaucracy
Supercell’s culture is all about small teams with autonomy doing what they do best. When I sat down with CEO Ilkka Paananen, a boyish 34-year-old decked out in Supercell attire, he told me his goal was to become the worlds least powerful CEO by relinquishing control to these “cells.” “Get the best people then get out of the way and let those people do their jobs,” Paananen said.
Every cell makes its own decisions – regarding how to change or whether to kill a game – and the idea of having an autocratic leader in any group is abhorrent to the company. Sure, there is a team member that keeps the group adhering to some kind of schedule, but the chemistry of autonomy seems to have created a sense of responsibility that keeps the cells moving of their own volition.
When you walk around Supercell’s offices, it seems that every group has its own corner, yet they freely mingle throughout the day. There are no personal offices at Supercell, just several conference rooms with names like “Ultramarine” and “Unicorn Tears,” (a room with couches, stuffed unicorns and a TV).
Growing and Growing and Growing and…
The 95-employee company is swelling. When I spent time with the customer support team in Helsinki, they told me that in September they had numbered six and now their ranks have grown to 15, with two more in an office in San Francisco (12 nationalities, giving support in 9 languages, handing about 20,000 customer communiques a week).
The analytic and engineering team has doubled in size in the past six months and is in search of personnel, said team lead Sami Yliharju, standing among his team beneath their “World Domination” map which displays real-time info on where in the world people are playing Supercell games. Yliharju likens his sectors growth to being strapped to a rocket. “Every few weeks we are running new servers,” he said.
A year ago the team overseeing the development and maintenance of the Clash of Clans game (4.5 million daily players) had five members. Now it’s up to 11, said team lead and company co-founder Lassi Leppinen. Leppinen estimates that there are almost 500,000 clans worldwide of no more than 50 members each. This spring, two people who had met at a meeting of one of those clans got married, he said, smiling. Who says mobile gaming can’t bring people together in a meaningful way?
In the US Supercell has a six-person outpost working out of co-working space in San Francisco. According to Paananen, the company will be taking over a new, dedicated office there that could eventually house 50 employees.
In total, the company's ranks are made up of 21 nationalities, 60% of employees are from Finland and, just to make things easier, all business is conducted in English.
Future?
By the numbers, Supercell is currently the hottest mobile gaming company on the planet. In the next year the ‘Hit-Makers from Helsinki’ will take several steps to try to send that success into overdrive: breaking into the lucrative Asian markets and bringing their games to Android. Traction in China alone – the Android-heavy, largest mobile market in the world – would be a tremendous financial success if they can pull it off through convincing localization.
Should Supercell experience any failures along the way, I doubt it would get the company down. My first night in Helsinki – dining on reindeer and salmon soup at a local restaurant with Kodisoja, Haussila and company spokesperson Heini Vesander – Supercell has a party when one of their ideas fails. The entire company meets, discusses what to take away from their loss and drinks champagne to celebrate. As Kodisoja told me that night, “We are not celebrating failure; we are celebrating the learning that comes from failure.”
Story at Forbes 4/18/2013
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