In response to Hunter’s recent AF post on the return of speculative-driven GameFi projects, I wanted to take a look at another future theme highlighted in our YA report – one that falls on the opposite side of the speculative spectrum.
As more new gaming platforms and tokens launch into an already saturated market of unsuccessful slop, some speculate that we will see increasing demand for projects backed by strong fundamentals. There are several factors, such as team and funding, that help determine what a fundamentally strong gaming project is. However, for the sake of this report series, we will focus on games that have proven, over an extended period, that they can generate more money than they give out in incentives.
This is because, when tires hit the road, only games (regardless of Web3 or Web2) that find the right balance between player lifetime value (LTV) and customer acquisition costs (CAC) can scale their user base profitably. The unique value proposition of blockchain-enabled games then becomes the ability to drive some of that value back across core stakeholders in order to boost engagement and retention (further driving monetization and fueling the flywheel).
Note that in our opinion, revenue derived from the direct sale of assets (e.g. capped supply NFTs or public token sales) doesn’t count.
There are a number of studios that potentially fit this description, some of which we will highlight in future posts in this series. However, today we will take a look at one studio turned publisher that, despite largely flying under the radar, has shipped one of Web3’s most successful games.
With deep roots in traditional publishing, a portfolio of powerful IP-driven titles, and a majority Web2 player base, this Web3 publisher/blockchain network sets the bar for other projects following a fundamentals-first approach. The following case study also works as a stark reminder of the large performance gap between leading Web3 and Web2 incumbents and the remaining challenges yet to be overcome before we can close that distance.
Mythical Games (Mythical) is a North American Web3 games studio founded by industry veterans in 2018. Headed by John Linden, the former studio head at Activision and president at Seismic Games, Mythical has secured almost $300M in funding and launched
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