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Wargaming cofounder Nick Katselapov has launched Mika Games, a gaming investment company that aims to invest $50 million in mobile game studios.
So far, Mika Games has raised $10 million in an initial funding round led by Boston-based venture capital firm Flint Capital.
Nicosia, Cyprus-based Mika Games wants to provide capital and comprehensive growth support to mobile game studios in their soft launch stage, meaning they have a game ready to launch for testing in a single market.
The goal is to ultimately invest $50 million in a portfolio of gaming studios, in order to help them become self-sufficient and scale from the seed stage, increasing valuations and aiming at an eventual initial public offering.
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Mika Games, established in 2023, said it is one of the few specialized investment companies of its kind in the gaming market, and has already invested in two mobile studios: Guli Games and Hot Siberians. These partnerships exemplify Mika Games commitment to supporting ambitious gaming founders worldwide and driving their success.
Katselapov was inspired by a deep interest in mobile games, which he views as the most accessible and massive form of gaming to date. Beginning his early gaming career as a producer, he aimed to use his experience and the knowledge gained from growing and operating Wargaming to boost growth within the teams Mika invests in.
A common problem
The company addresses a common problem in the gaming industry. Numerous studios, despite having a finished product, are forced to halt progress after depleting their initial funding.
If they are not yet generating enough revenue, VCs not involved in the gaming business are generally hesitant to invest at this stage, since they do not fully understand the industry. Mika Games, founded by gaming professionals, knows how to differentiate projects with enough potential for market success and can thus choose them for investment and bridge this gap, the company said.
“83% of mobile games fail within three years, and a significant factor contributing to this is the lack of financing and business guidance,” said Katselapov, in a statement. “We see a huge market gap here, which presents an immense opportunity that we can capitalize on. Our industry experience as both investors and operators positions us well to select talented teams and ambitious games, invest money and effort in their development, gradually building up value and multiplying our chances for break-out success.”
Unlike traditional early-stage gaming venture funds, Mika Games selects only a handful of studios, which are already established and have successfully built a game. The company supports them at their soft launch stage, in order to scale up and achieve a monthly revenue of at least $1 million.
The goal is to surpass this amount. Mika Games acts not only as an investor, but leverages its team’s expertise to provide hands-on support regarding business processes, game design, monetization, marketing, and product strategy.
“We consider Mika Games a highly promising project with gaming expertise, and a well-thought-out business model. This, combined with our support, will enable them to achieve ambitious goals,” said Dmitry Smirnov, partner at Flint Capital, in a statement. “Flint Capital has both an early-stage fund, through which the investment was made, and a late-stage fund, indicating our ability to support it throughout its entire life cycle. In our portfolio, we have companies that have already gone public and unicorns such as Socure, Flo, and WalkMe. We know how to navigate this path and are excited to do it together with Mika Games.”
The mobile gaming market is anticipated to rebound to $111.4 billion in 2024 after a decline in terms of active growth in 2022-2023. Since investments in the market have decreased, many prospective players who have passed the seed stage are seeking additional funding. This presents an excellent opportunity for the company to identify and secure the best projects under favorable conditions, Mika Games said.
Mika Games currently has three employees: Katselapov, CEO; Anton Kolkovskiy, investment director and COO, and one analyst in the back office. The firm is taking a lean approach, and it plans on offering gentle guidance as well as “heavy and honest feedback.”
The firm will invest globally and across genres, focusing on mobile-first, free-to-play live service games with long-term monetization potential—games that could be played for years.
Katselapov’s name came up more than a year ago with the start of the war in Ukraine. The Belarus KGB accused him of being a terrorist (presumably for helping Wargaming move out of its Russian operations) in the state of Belarus.
“Mika Games is aware of allegations in the Republic of Belarus against Nick. Although the authorities of the Republic of Belarus are attempting to prosecute some entrepreneurs and private individuals for political reasons, the company cannot comment on the specifics of this matter,” Mika Games said.
