The Games Fund invests US$3 million in newly-founded Cyprus-based mobile game company

The Games Fund (TGF), a Paphos-based venture capital firm, has invested US$3 million in newly-founded Cyprus-based mobile game company Juicy Buttons Games, which is developing a 4X strategy game.

The dinky abbreviation stands for Explore, Expand, Exploit, Exterminate, referring to the genre's empire-building premise, involving various military and non-military strategies. Speaking to CBN, Ilia Eremeev, one of TGF's founders, mentions, "4X strategy games are one of the most interesting yet difficult genres".

Known for its capital-intensive nature, it is one of the most revenue-generating genres, provided user acquisition and monetisation are adeptly managed. “The games in this niche are super sustainable. If you find a winner, you can keep delivering fun for players for years,” Eremeev says. Indicatively, the Rise of Kingdoms, Lords Mobile and Game of War have grossed over US$2 billion in lifetime revenue. Other 4X games that have grossed over US$1 billion include State of Survival, Evony, Top War and Puzzles & Survival.

The Lucrative Mechanics of 4X Games

The economic model underpinning 4X games is a key to their profitability as players tend to be deeply engaged, leading to high long-term retention, though initial retention may be lower due to the games' complexity. Nonetheless, once players overcome the steep learning curve, they remain committed. “These games are designed for players with deep pockets. It allows players willing and able to spend significant sums on entertainment to do so,” Eremeev notes. "It's one of the few genres that allow people to do that." Community engagement in the genre is paramount; players form alliances and engage in in-game politics, transforming these games into more than mere time killers – for many, they become serious hobbies.

Backing Juicy Button Games

The mobile game developed by Juicy Button Games, currently a playable prototype, combines proven strategic mechanics with innovative marketing insights, as evidenced by successful initial marketing tests – in the competitive world of mobile gaming, marketing prowess is crucial, accounting for approximately 60% of a game's success.

More importantly, the mobile game company was founded by three people with a wealth of experience and a proven track record; each founder has previously built businesses worth over $200 million. "We knew all of them for quite some time; some even for decades," Eremeev notes. Alexander Kravchuk, who has more than two decades’ experience in mobile gaming, created Total Battle, a leading MMO strategy game and, according to Eremeev, has a rare and valuable experience in building the technological stack for 4X games. Anton Sinelnikov was the co-founder and Game Design Director of Cubic Games, which was acquired by Limassol-based Nexters in 2022 for US$100 million, with the most famous title under his name being Pixel Gun 3D, a mobile FPS. Eremeev says, "He has a great experience in design mechanics and production; essentially how to build a product." Finally, Aleksandr Zaytsev, described as "a marketing guru," had previously co-founded Paroramik Games, specialising in mobile mid-core fantasy games. "It’s not a 100% guarantee that people who previously had some success will be able to replicate it, but the odds are just higher," Eremeev mentions.

(Much) More to come

Besides investing in Juicy Buttons Games, the VC has also participated in a new fundraising round for one of their existing portfolio companies based in Cyprus and just closed another deal -- the fund's biggest early-stage investment to date – with a Polish company building a PC & Console game. “That’s all I can say now,” he says, hinting at more things to come. It is worth noting that TGF, which has raised US$50 million, has been one of the most active investors in the global market in 2023 (US$25.8 million) and continues to be in Q1 2024, with a focus on Central and Eastern Europe.