Has Mobile Premier League (MPL) lost its mojo?

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Happy Wednesday and welcome to the 12th edition of Weekly Olio - your weekly dose of curated content with a tinge of a thought piece (yes, we mean Publisher’s Parmesan here). 🤭

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Today’s, Publisher’s Parmesan covers Mobile Premier League (MPL) and its quest to find the next big thing.

For context, MPL is an online gaming platform based in Bengaluru, India. It offers multiple games including card games like rummy and poker, fantasy gaming as well as casual gaming like ludo and carrom, on a single app with a real money component to them.

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Publisher’s Parmesan 🧀

Has Mobile Premier League (MPL) lost its mojo?

The Sequoia-backed gaming company has been struggling to find its next big thing and grow its valuation.

In September 2021, MPL announced a massive round. It raised around $150M at a valuation of $2.3B, a significant number for an Indian gaming company. In its previous fundraising round, in February 2021, MPL had been valued at $945M.

This was a big jump for MPL. But as people suggest in the gaming space, MPL has always been an investor darling, with Sequoia being an early supporter. More fashionably, it comes from the ‘raise a lot, move fast, outspend everyone’ school of startups. 😎

But when MPL tried to initiate another fundraising discussion earlier last year, investors seemed hesitant. Global macroeconomic concern given the Russian invasion of Ukraine was partly the reason.

However, there was another realisation as well - the realisation that MPL had a lot of work to do to grow its already high valuation. The company had a promising core product of real-money gaming. It offered 60+ games like ludo, carrom, chess, fantasy sport, cards and even fruit-slicing. And the players get a chance to win real money by participating in competitions. But beyond that, it didn’t have much to show for.

The company was experimenting with a few things and had some expansion plans in the pipeline, but nothing concrete or of scale yet.

Consequently, weeks later, MPL laid off 100 employees (10% of its workforce) and exited Indonesia, one of its high-investment markets.

Since then, MPL has been trying to get its story right. It has set up two new ventures and has been trying to raise money separately for one of them. It has also streamlined budgets to be able to turn profitable in its core business.

Simply put, MPL is on the hunt for the next big thing, something that is an “absolute necessity to convince the investors”.

What all has MPL already tried so far? Let’s take a look.

MPL has managed to build a decent business on the back of real-money gaming which acts as its core. To top that up, it tried a few things last year.

The first was an attempt to create a social community around gaming - a network where people could follow gamers, gamers could create content and viewers could give them gifts. However, MPL saw technical and moderation difficulties in the process and the whole social thing was shut down.

Next was the plan to go bigger on e-sports. And for that, MPL acquired New Delhi-based e-sports company GamingMonk. Yet again, not much came of that plan. In a realignment of priorities, e-sports was dropped as a high-focus area and hence, the value proposition of GamingMonk was nullified.

In a similar realignment of priorities, MPL exited Indonesia. The company was hoping for Indonesia to scale faster and deliver higher returns. But as the funding slowdown and inflation fears neared, the US market (followed by Europe) seemed like a more lucrative opportunity. To fast-track its expansion in Europe, MPL acquired German game studio, GameDuell.

In this context, MPL has already tried and erred on multiple fronts - international expansion, products and tech features.

Hmm… Things don’t seem to look good. Do they?

But, what next?

MPL’s problem is twofold. One is that it hasn’t been able to find its next big story. Two, in its existing business, the company hasn’t turned profitable, even as competition has intensified - there are smaller rivals that are creeping up in different games such as rummy and poker.

To address profitability, MPL has been consciously focusing on making the business EBITDA-positive. Hence, all the cutbacks.

On the other hand, MPL has been working on two new ventures. One, it rebranded its original gaming vertical to a full-fledged game studio called Mayhem Studios. And two, the company now has a Web3/ crypto gaming venture called Good Game Exchange, or GGX.

The idea behind GGX is to provide tools to game developers who want to integrate cryptocurrencies and paid-for game items on blockchain-based networks. The pitch is similar to what is being built by WazirX co-founder Sidharth Menon and his new venture Tegro. Mayhem Studios is building the first game to be launched on GGX, a mobile battle royale game along the lines of PUBG and Garena Free Fire, but with the “play-to-earn” mechanics of cryptocurrency games.

Setting up a game studio is quite a different business from what MPL currently has. Unlike casual games that are easy to develop and copy, game studios have their work cut out when it comes to developing original games. The studio business is about building striking intellectual properties that are capable of attracting and engaging users.

If the company pulls this off successfully, this could very well be the win that it needs.

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