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Lumikai Fund Leads Giga Fun Studios’ $2.4Mn Seed Round to build next-generation casual games

Giga Fun Studios Founders: Rahul Shekhar, Ragul Daga, Krishnendu Mukherjee (L-R)

We are thrilled to announce our investment in Giga Fun Studios, a game studio that aims to produce high-quality casual puzzle games for mobile, catering to domestic as well as global audiences. The long-term goal is to export the richness of Indian culture globally through casual metas, creating the King of India.

As per our State of India Gaming Report, the Indian gaming market reached $2.6B in FY22. The casual and hypercasual genre accounted for ~$500M (~20%) of this market and is expected to grow at a 25% CAGR y-o-y and is estimated to reach $1.5B in revenues by FY27. With 15 Bn downloads, India is also the largest consumer of mobile gaming apps worldwide.

Global casual puzzle games have been popular in India, but historically monetisation has been a challenge. This is different from what we see in midcore titles (such as BGMI, Free Fire), board games (such as Ludo King, Carrom), or card games (such as Teen Patti, Rummy). A piece in the success of the aforementioned games has been their ability to appeal to Indian sensibilities in different ways.

Traditionally casual games have largely monetized through ad revenues in India, which accounted for 90% (~$450M) of the category’s revenues in FY22.

However, in recent years, we’ve seen examples of games that have made monetisation inroads using a combination of IaP optimisations, geo-specific live ops, familiar IP and engaging game loops. For example, Coin Master has managed to tap into the Indian audience’s innate psychology of loss aversion by providing variable rewards and frequent dopamine hits, by employing low cognitive load mechanics and social loops. In 2022, Coin Master made ~$20 million just from IAPs in India. This is despite the fact that slots are a largely unfamiliar concept to Indians. In midcore games, Free Fire and BGMI have seen immense success with their use of battle passes appealing to a value conscious Indian gamer and their use of custom events/focused live-ops. Yet another example is Ludo King, which has managed to tap into relatability and nostalgia, thus, gaining massive market share and being able to effectively monetise ads.

In general, game mechanics and IaPs in casual games have historically not been optimized for an Indian audience, leading to lower conversion rates for spending. It is not simply adapting to Indian aesthetics; there exists the possibility of a playbook to unlock IaP monetization and at scale ad-monetisation in India for casual games. This involves the use of relatable themes and concepts, geo-specific mechanics and distribution, and localized pricing, while at the same time providing a world-class design experience.

This is exactly what Giga Fun Studios intends to do.

1. Long-term retention driven by familiarity: Giga Fun Studios’ core thesis involves building its games on relatable content and story arcs. According to our State of India Gaming Report, 80% of gamers show a high proclivity to play games based on Indian IP. As mentioned earlier, Ludo is the paragon of localised content hitting it out of the park. It married nostalgia with social mechanics, tapping into a sweet spot for familiarity for the ever-social Indian audience. The Giga Fun founders propose to use familiar game mechanics such as match-3, marrying them with relatable Indian content such as weddings, Bollywood, mythology, etc. The idea is to take established game mechanics and weave them with localized themes and content.

2. Leveraging the right game mechanics: The success of casual games with simple mechanics such as Coin Master in India provides a key insight into the mind of the casual Indian gamer. Perhaps as important as using relatable content, Giga Fun’s thesis is that building games with low cognitive loads and simple learning curves are key to unlocking the Indian audience — a process that can be referred to as “engagement localization.” This also entails building progression systems that are most suited to a time-rich audience that is willing to spend more hours grinding for in-game rewards, as compared to their western counterparts.

3. Unlocking LTV with localized pricing: International developers have applied western playbooks and personas to their monetization strategies, and this manages to capture only a small subset of the market. As we have observed in the Battle Royale category with BGMI and Free Fire, Indian playbooks for monetization need to be developed by iterating revenue mechanics specific to local purchase behaviours. For example, BGMI introduced Battle Passes as a primary monetization tool, which served as an attractive IaP option for the value-conscious Indian gamer.

Another method of localized pricing is to calibrate micro-transactions according to geography. For example, a Candy Crush starter pack is usually priced at INR 180/USD 2.19 in India. This is higher than the INR 100/USD 1.21 monthly subscription of the OTT platform Disney Hotstar, and hence the value proposition is hard to justify. Giga Fun intends to price its starter pack based on minutes of entertainment provided, as Indian purchase behaviour is not driven by an impulse like in the west, but by value experienced.

Giga Fun is founded by a trio of seasoned game designers and developers: Krishnendu Mukherjee (Former AVP and Head of Game Design at MPL, former Lead Product Manager at Zynga), Rahul Daga (Former Director of Products Zynga, Country Head at m56 Studios), and Rahul Shekhar (Former Engineering lead at m56 Studios). The founders bring 25+ years of combined experience in building and running games as well as building high-performance game development teams. The founders have collectively shipped and operated 10+ games with experience managing gaming P&Ls of $100M+.

The company will utilise the funds from this seed round to create a new benchmark in casual games built to high quality for Indian and global audiences. The founders will be investing heavily in curating a stellar team as a hub for “best in India” casual game developers.

We are thrilled to partner with Fireside Ventures, All In Capital, Kettleborough VC and Riverwalk Holdings in this $2.4M Seed round.

Read more here.



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