Finnish gaming takes flight on Angry Birds’ success
Venture capitalists flock to Scandinavian nation in search of next golden egg
In the wake of the global success of Angry Birds, venture-capital firms are looking to other Finnish gaming startups for the next golden egg, leading to a welcome economic boost for the Scandinavian nation, Bloomberg reported.
Those developers attracting most interest are makers of download favourites Clash of Clans, Hay Day and Hill Climb Racing, each of which amassed millions of purchases in online app stores.
Angry Birds maker Rovio Entertainment Oy took $42 million in VC funds in 2011 and has laid the ground for local rivals including Supercell Oy and Grey Area Oy to secure similar international investment.
With an annual expansion rate of 57%, the mobile gaming boom represents niche growth for Finland, whose population of 5 million is feeling the effects of the decline of global giant Nokia. The country's gaming houses have soaked up some of the excess labour left jobless by Nokia's downsizing.
"There's an amazing critical mass here," said Sean Seton-Rogers, general partner at London-based Profounders Capital, speaking at the Nordic region's biggest startup conference, Slush, in Helsinki last week. Seton-Rogers helps manage a 30-million-euro ($39-million) venture fund, which last year invested in Finnish startup Applifier, a mobile gaming cross-promotion network.
"The market has really grown with the growth in mobile gaming," said Seton-Rogers. "As that's taken off, people pay more attention now."
Supercell scooped $12 million in backing last year from Accel Partners, which also has a stake in Rovio and also backed Facebook Inc in its early years. Grey Area, maker of location-based multiplayer game "Shadow Cities," has raised money from investors including Index Ventures and London Venture Partners.