How Does it Feel to Sell a Startup for $800 Million?
A serial entrepreneur tells Benzinga what it's like to build a startup that soared to nearly $1 billion in value.
Fourteen years ago, Greg Borrud left his job at Activision (NASDAQ: ATVI) to found a game development studio of his own. It was a risky move, no doubt. While the video game industry has always been competitive, 1998 was a rough year for the industry. Consumers had begun to switch from Nintendo (NTDOY) consoles to a newfangled device from an industry novice: Sony (NYSE: SNE). Several new studios began to rise up, hoping to cash in on the success of Sony's machine, the all-mighty PlayStation. But many didn't survive.
Borrud's company, Pandemic Studios, was different. As the developer of the popular Star Wars Battlefront series (along with Mercenaries, Destroy All Humans!, and Full Spectrum Warrior), Pandemic excelled as a studio that was capable of producing solid hits. Thus, when Electronic Arts (NASDAQ: EA) offered to buy the company, it's no surprise that it sold for more than $800 million.
But while this is a huge accomplishment for Pandemic's founders, Borrud said that the startup experience feels very similar to that of building and selling a successful empire.
“We started Pandemic Studios with 13 people in a warehouse in Santa Monica,” Borrud told Benzinga. “Seismic was founded by 15 people in a warehouse in Culver City – although now we have the benefit of decades of combined experience making games. It was a real adventure building Pandemic to be nearly 500 employees with offices in LA and Australia. We're very proud of what we accomplished in our 12 years and we learned a tremendous amount about not only building games, but building companies.”
For Borrud's latest venture (Seismic Games, a new LA-based social games company), the serial entrepreneur said that he and his team are “trying to bring all of those experiences to bear as we build Seismic.”
“We are focused on building nothing but the highest quality products that provide countless hours of entertainment to our players,” said Borrud. “This is what we did at Pandemic and we will continue to do the same thing at Seismic.”
Despite the financial troubles at other social game companies, such as Zynga (NASDAQ: ZNGA) – which loses $150 on every new paying customer – Borrud believes that there is a “tremendous amount of growth potential in social games.”
“I think we have just hit the tip of the iceberg,” he said. “Obviously there will be the technical advancements that will improve the way these games look over the next couple of years. But we also think there is quite a bit of opportunity in the design as well. We are focused on marrying the traditional game design techniques we have learned, which focuses on games as true forms of entertainment, with the more analytics-based approach that current social games companies like Zynga have been employing. We believe the next wave of social games will not only be highly addictive but also highly entertaining. Mobile games have done a better job of blending both of these worlds and we think there is room to grow in social games.”
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