Tencent has Invested in Grinding Gear Games

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Der_Fraggle wrote:

They sold everything, including Ziz's stash of Red Bulls and Mathil's attitude

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vacii wrote:

If they were selling out, they would have gave them 100% and left the company. Until Chris announces his departure you are just speculation and throwing a fit for nothing.

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Tencent's agenda is clear: to give us the resources to make Path of Exile as good as it can be.

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Aldora_the_Summoner wrote:

The utter lack of business acumen here is staggering, though not entirely surprising. I'm pleased to see some intelligent, thoughtful posts among the assorted doomsday preppers.

In regard to company mergers, there are plenty I've seen where the company is part of the broader group but operates as an independent business unit with the original management and staff still operating, because let's face it they are the experts in that business.

Yes, there are plenty of examples of things going wrong, but we tend to gloss over the less dramatic stories of when everything goes well.

Now stop and think for just a moment about why Chris and the other business partners decided to sell now.

Do we think they're doing it for independent wealth? I think it's safe to say that GGG has been successful and they are all comfortable as a result.

Do we doubt Chris's passion for the game? I think we can rule that out, he genuinely wants the best for PoE, it's his baby.

Are they rubes being taken for a ride because they lack the skills and ability to negotiate with a large company? I think they're arrangement with Microsoft demonstrates that is not the case.

So we still haven't answered the why and now.

Consider this, there are some fundamental issues with the game as a result of its genesis which have been the source of ongoing complaints and no doubt are constraints to future development. Top of this list would be the choice of game engine and poor optimisation which result in a gimped experience for many.

To take the game beyond where it currently is, to run a re-development team in conjunction with the usual BAU improvements and league development activities would require a significant injection of capital.

Rather than wait 12 years to save enough company profit to make these major investments, GGG saw the opportunity to bring on an investor that could allow them to do this and be well positioned to engage in the gaming market on a more sophisticated level.

To make this sort of leap, there really are limited options available. A bank won't loan you the money for a company with limited physical assets and right now launching an IPO is risky and likely to saddle you with business partners that are only after profit and don't care about your product.

So why is Tencent interested?

Along with WeChat, Tencent Video (like Netflix) and Tencent Music (like iTunes), Tencent is also heavily invested in gaming with more than 40% of its revenue generated there. Several years ago 60% of Tencents gaming revenue came from only two games and as we know gamers can burn out or lose interest so having such a consolidation of revenue was a business risk to the company. A smart organisation will seek to generate additional revenue streams to seek more market share as well as diversify risk.

So obviously Tencent's goal is to be heavily invested in technology and entertainment and adding GGG to the stable is a sound business strategy. There is great future potential in PoE and it has a loyal and passionate following. The game has grown and demonstrated longevity in an unforgiving industry. Both parties here can benefit by investing further in the game and staying loyal to its foundations.

I'm also excited to see what else could be in the pipeline as alluded to in the Exilecon post and supported by this announcement. What other PoE related products could be in the works? Could we have an RPG like Skyrim perhaps, some form of isometric mass battle simulator, or perhaps a diverse support of physical products like all those wonderful T-shirt designs, collectable currency orbs, etc.?

And if all that goes to hell in a handbasket, is Grinding Gear Games a self sustaining entity, or is Grinding Gear Games the sum of Chris, Jonathan, Erik plus the dedicated staff?

In other words, if the company is disabused of all quality and integrity, the staff can simply up and leave, go form another company and start developing a new game (yes, no doubt there are non-competitive clauses for set periods but that's not insurmountable). It won't be called PoE, but then again PoE wasn't D3 either.


Finally (yes, I'm a prolific waffler), I totally enjoyed this piece of much needed levity so it's worthy of repeating:

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Der_Fraggle wrote:

They sold everything, including Ziz's stash of Red Bulls and Mathil's attitude

The sky is not falling, the sun will rise tomorrow, and PoE will still be one-shotting players for years to come.

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vacii wrote:

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JoOnky wrote:

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vacii wrote:

You entitled "people" threatening not to buy supporter packs because feelings is what led to this. People need security to be productive and work towards a goal. Entitled milenials with attention span of 6 seconds, clueless to how the real world works can provide any sort of security.

u mean the security we open/closed beta supporters had in believing GGG founders are good guys, who wont sell out like notch did? the only reason this game BECAME big was of the ppl who supported GGG when all GGG had was integrity, now thats gone.

i can assure u its not ALL millenials, that had the money and patience to invest in this game when it looked like runescape.

u dont know nothing

I mean financial security for the content they need to develop. Financial and social security for their employees (which a re the people who do all the heavy lifting and earn their salaries ten fold). Economic security for the local industry.

What you are describing is an emotional security, no one forced you spend money, no one forced you to believe or to stop believing in that matter.
What they did is ensuring you get the content you want, faster and with better quality.

Assumptions like "This is the end of the world", are idiotic in the sense that this your beliefs are no necessarily how the real business world works.

I would like to propose a question if GGG were selling shares to the public instead, how many shares would you buy, without expecting any dividend?

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Aldora_the_Summoner wrote:

I'm also excited to see what else could be in the pipeline as alluded to in the Exilecon post and supported by this announcement. What other PoE related products could be in the works? Could we have an RPG like Skyrim perhaps, some form of isometric mass battle simulator, or perhaps a diverse support of physical products like all those wonderful T-shirt designs, collectable currency orbs, etc.?

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hellzer wrote:

SELLOUT