PM announces East London Tech City

November 2010

From the office of David Cameron, Prime Minister, on November 4, 2010

Press Release announcing the government’s intention to transform East London into a world-leading technology centre to rival Silicon Valley with commitments from Vodafone, Google, Facebook, Intel and McKinsey to invest in the area. (Incidentally, Digi-Capital’s offices are located in the ‘Silicon Roundabout’.)

Money Games: Sell Your Company Now! (Part 1)

October 2010

This article was first published in two parts by Games on 27 October 2010 and 27 November, as part of Tim’s monthly column ‘Money Games’.

Part One – Is it the Right Time to Sell Up?

Ngmoco is the most recent in a string of headline-grabbing online and mobile games deals in the last year, each with an apparently more stratospheric exit multiple (price as a multiple of revenue or operating profit) than the next – Playfish, Tapulous, Playdom anyone?

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Merel to present investment review at Shanghai World Expo

September 2010

This interview by Phil Elliot, ahead of Tim’s presentation at Shanghai World Expo, UK Pavillion was first published by Games Industry. Biz on September 15, 2010.

New monthly columnist, Tim Merel, is to present the latest version of his Global Video Games Investment Review at this year’s Shanghai World Expo, UK Pavilion – and he’s offering five readers free passes to the invitation-only event.

The session and following meetings will focus on both Chinese companies and investors operating internationally, as well as international companies and investors seeking to co-operate with Chinese firms within the country itself.

“I’m grateful to have been asked to talk to some of China’s greatest games companies, media companies and investors in their home country, and in particular at the spectacular Shanghai Expo UK Pavilion,” said Merel.

“I’m hoping that the session and following meetings will help Chinese companies and investors to broaden their investment horizons internationally, while also providing a new way for international companies to work in partnership domestically with leading Chinese firms.”

The review focuses on investment, merger and acquisition, and joint venture opportunities in videogames (including MMO, casual/social online, mobile, console, online gambling, skill based, and in-game advertising sectors) for industry players and investors (including major and independent videogames companies, private equity and venture capital firms, and major media, telecommunications and technology companies).

Money Games: Tencent

September 2010

This article was first published by Games, on Sept 14, 2010, as part of Tim’s monthly column ‘Money Games’.

As the business of videogames moves ever more into the spotlight, is pleased to bring you a new monthly column from Tim Merel.  Each month he’ll be examining a subject or sector of interest, beginning here with China-based company Tencent – and why it could be the biggest videogames company you might not have heard of.

Who am I?

Let me start by apologising – I used to be a lawyer, then I worked for Rupert Murdoch… and now I’m an investment banker. But – I’m also a software engineer, I write adventure stories, and I play a mean guitar, so life is a balance!

We’re starting my monthly column with a profile of the greatest games company you may not know, Tencent. “No!” I hear you cry. “Surely Activision Blizzard, Electronic Arts, Take-Two or Zynga is the greatest?” Well, this all depends on your perspective, and when your perspective happens to be money, things change.

So who is Tencent?

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Online and Mobile Games should generate more revenue than console games

August 2010

First published by Venture Beat, on August 10, 2010 (reappeared in New York Times).

The video games industry is big and getting bigger. But it’s changing. Console games are getting riskier to make, while online and mobile games are taking over the market (see my updated Global Video Games Investment Review, which I’ll be using to open GDC Europe).

Today online and mobile games generate about a third of all games software revenues globally. In five years’ time they are forecast to generate 50 percent of all games software revenue, or around a fifth more revenue than pure console games. This morning, market researcher iSuppli said that cell phone games are growing fast as console and handheld games sputter. Whether you have faith in the forecasts or not, executives from the major U.S., European and Asian publishers all tell me that this is what keeps them awake at night.

What excites me about the online and mobile games markets is that they are both high-growth and profitable, which is pretty rare. The leading competitors are growing revenue 100 percent-plus annually while also delivering 20 percent to 30 percent EBITDA (earnings before income tax, depreciation and amortization) margins. Add to that a fragmented industry structure, no dominant leaders yet, plus clear strategic exit options, and it looks like this is the time for strategic game and media companies, as well as financial investors, to invest.

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