How did Animoca Brands manage from elimination to become a big winner in the cryptocurrency industry?

In this year's wave of NFT and metaspace content, Animoca Brands is one of the biggest winners. Sandbox is one of the most popular NFT projects right now, with developers at Axie Infinity Sky Mavis, Decentraland, Dapper Labs and more. The Star Project's early investors collected over 150 NFT / Meta Universe works. In fact, Animoca Brands is a company that has been developing mobile games for two years and has been delisted from the Australian Stock Exchange for various reasons. Today, the project generated $ 670 million in revenue in the first quarter alone, making it a unicorn of NFT runners.

With the explosion of the travel channel and the explosion of the meta-running world in the second half of this year, the well-designed unicorn brand Animoca in the field has emerged.

Animoca Brands was established in 2014 and is headquartered in Hong Kong, developing sandbox games The Sandbox and F1 Racing F1 Delta Time and other racing games. In addition to product development, Animoca Brands is an early developer investor in Axie Infinity Sky Mavis, Decentraland, Dapper Labs and other NFT flagship projects, and has invested over 150 NFT / Meta Edge Ocean .

For most people, Animoca Brands is rather a leader in the live crypto industry. So how did you manage your finances and where did you go?

01

come back alive

The company was founded by tech company Yat Siu in 2014 and is well known for its development and marketing of mobile games until the end of 2017, in which its business also includes e-books.

Animoca Brands was listed on the Australian Stock Exchange (“ASX”) in January 2015, but performed poorly and spent more money to supplement its cash flow. According to data from Crunchbase, Animoca Brands made a total of $ 9 million after the IPO between 2015 and 2019, with a total of $ 34.3 million spent on promoting various mobile games, e-books, VR, chain games and other businesses. But the results of this period were very good.

In the fourth quarter of 2017, the operating result for the quarter was negative. Data shows that the company's stock price has fallen more than 95% from its previous high of 0.2 AUD in August 2017 to less than 0.01 AUD.

Source: 61 Finances

In the second half of 2017, following ASX earnings calls, Animoca Brands implemented three adjustments to reduce costs and increase revenues: the restructuring of the first brings salaries, the sale of non-essential products and the dismissal of staff. reduced by 50%. %. That year, 318 of the 524 mobile games were sold for a total of $ 8 million, mostly casual games, and the number of employees fell from over 110 to under 70.

As of November of this year, the company had 527 employees worldwide, making it the largest NFT operator. What's going on in the middle?

The transition began in early 2018. Yat Siu, director and founder of Animoca Brands, told Chaincatcher that Animoca Brands acquired a games company involved in building Cryptokitties. CryptoKitties is the most popular first-generation blockchain game of all time.

“This is my first time involved with blockchain games and NFTs. We immediately realized the strengths and benefits of this medium and how NFTs can provide digital assets for people to play to achieve the desired impact. in the sports industry has always been. "said Yat Siu. Since then, Animoca Brands has started to focus on NFT based games.

In January 2018, Animoca Brands signed a one-year licensing and export agreement with Axiom Zen, the Cryptokitties development team. Animoca Brands has the exclusive right to distribute Cryptokitties in China, which will represent up to 30% of its turnover.

In August of the same year, Animoca Brands acquired Pixowl, developer of the Content Builders (UGC) The Sandbox gaming platform, for $ 4.875,000. Active users at the time. Pixowl also plans to release a blockchain version of the game.

“Acquiring Pixowl and Sandbox for less than $ 5 million turned out to be a very good investment,” Yat Siu told Chaincatcher.

Sandbox is now one of Animoca Brands' greatest achievements. As of December 21, the total market value of the SAND sandbox token was $ 4.7 billion, ranking 37th by market cap of CoinMarketCap, and the market cap was $ 15.3 billion. At the same time, the Sandbox virtual real estate market took over and Republic Realm set a new real estate selling price on November 30 with a purchase price of $ 4.3 million.

In an interview with Chaincatcher, Yat Siu said that there are many opportunities for this acquisition in 18 years, including Martin Varsavsky, business associate of Yat Siu and one of Pixowl's sponsors, Pixowl, who created the IP names. . “But more importantly, Pixowl and its developers have a deep understanding of blockchain and NFTs.” Yat Siu believes these circumstances will allow the team to become a leader in blockchain and traditional games.

Animoca Brands invested in Decentraland and Dapper Labs in October and November. In January 2018, Animoca Brands worked with the WAX ​​blockchain to bring users created from the Sandbox game to the WAX ​​platform. .

At the end of 2018, Animoca Brands' revenue was still supported by mobile game sales, and its cryptocurrency-affected capital had lost 1 million yuan.

In November 2019, Animoca Brands made another major investment, raising $ 420,000 in the $ 1,465,000 financial round from Axie Infinity developer Sky Mavis. At the same time, through collaboration and discovery, intellectual property rights for sports such as Formula 1, US athletics and the Bundesliga have been secured, and resources for game blockchain game development have been secured. IP and NFT oriented were written.

In the meantime, ASX has published a questionnaire and a notice of temporary suspension.

A subsequent announcement from Animoca Brands revealed that ASX accused the company of having three issues: internal governance issues, multiple cryptocurrency-related transactions, and trade violations. Among them, Animoca Brands has not been the subject of allegations of involvement in crypto operations, and on internal governance issues, Animoca Brands has pledged to respond to allegations of breach of trust, but did not elaborate further.

In March 2020, ASX removed Animoca Brands from its list for "insufficient capacity, procedures and management to meet its obligations under the registration rules". The total cost of operating the business at the time was $ 124 million.

In fact, the impact of the withdrawal has more to do with the reputation than the benefits. During the five-year public financial period, stock prices rarely rose. Instead, the removal gave Animoca Brands a chance to show off its might, and it was able to slowly enter the deep waters of the NFT field, without fear of breaking listed company law.

In 2020, Animoca Brands will focus on developing and expanding its own assets. Sandbox announced sand tokens and launched Binance, F1 Delta Time games launched REVV token, NFT contract mining, NFT auctions, etc. Log in on time.

Meanwhile, Animoca Brands recently acquired over nine crypto companies one after another, including NFT Marketplace QUIDD, NFT Limpo gaming ecosystem, Prosper project prospector, independent developer Blowfish Studios and NFT. Bondly Resolution.

Currently, more than eight Animoca Brands organizations have announced tokens, but with the exception of Sandbox, other operations have followed the impact of the market and the price of the tokens.

Next, Animoca Brands also plans to release level 3A on-chain games, Phantom Galaxies, next year, and new games in the second quarter of next year in conjunction with the popular NFT Bored Ape Yacht Club project.

02 ib

Compared to game developers, it is closer to 16z in NFT.

In the first three years of the crypto cycle, Animoca Brands seemed to innovate to expand its network capabilities and operate in-house. A large ecosystem of NFT and the periphery of the network around the Yuan.

Quarterly investment by Animoca Brands in recent years Source: Crunchbase

Heading into 2021, investing in Animoca Brands has been rapid. As of December 24, Animoca Brands had received at least 81 crypto-related public investments, including Yield Guild Games, Bloktopia, GuildFi, ConsenSys, DeHorizon and more. In addition, the number of investments in the fourth quarter of this year accounted for 51% of the whole year, and large investments accounted for more than 36%.

In December, Animoca Brands and BSC teamed up to create a $ 200 million investment in on-chain gaming, and the frequency of future investments will continue. Currently, the company's website lists investments in over 150 NFT / meta-universe projects.

Yat Siu believes that meta-space activities in the blockchain space are likely to drive adoption by key groups. And "NFT represents the best time to experience the open world meta," said Yat Siu.

In 2021, Animoca Brands plans to increase its capital and capital market share once every 6 days on average. It has nothing to do with personal income growth and Animoca's financial size.

Source: Animoca Brands official website

According to a financial report released by Animoca Brands in December, from January to September of this year, Animoca Brands' total revenue was $ 670 million in total investment, and digital assets accounted for 79%, or about 529. , $ 6 million. . At the end of November, the company had a net worth of around $ 15.87 billion, including $ 112.1 million in major tokens such as BTC, ETH and USDC, and $ 456.3 million in third-party assets like AXS. personal digital assets. And FLOW is also generally a property like SAND.

Animoca Brands also received several major investments in May, July and October of this year, including Coinbase Ventures, Samsung Ventures, Sequoia China, Blue Pool and other cryptocurrencies and traditional Star Capital. . Despite being able to join Ubisoft, the 3A game giant, join the ranks, and its recent valuation of $ 2.2 billion.

In an article on "Why Invest in Yield Guild Games" on the Animoca Brands blog in March this year, Yat Siu spoke about the venture capital firm's "competition engine ecosystem". This assumption means that even if Animoca Brands invests in the developers of the NFT ecosystem and their competitors are competitors, in the end, Animoca Brands, the main body of the racing game and NFT production, "will benefit from the ecosystem. ".

"We believe that true digital property (virtual privacy rights) is the foundation that sustains the entire open virtual world. The creativity of digital assets gives you control over your assets, thereby bringing financial freedom and empowering the game at GameFi an opportunity for a fair community. Give. The way has been opened. "Animoca Brands posted on its official website.

In external applications, Yat Siu's investment options are generally “value” based. Yat Siu told the channel receiver that Animoca Brands would invest heavily in developing an “open meta-edge” project through groups that create regions and issues such as Apple and Google.

In an interview with Decrypt, Yat Siu said he sees controversy over the open world and digital distribution and digital technology. Explain to the audience the deception that perpetuates the kingdom they are about to create.

Compared to regulators, Yat Siu believes tech companies like Facebook and Tencent, which often interfere with member data, are "threats." And Animoca Brands is a 'forcing fast' investment, which means the open world meta-past is happening faster.

In fact, Animoca Brands' investing style is easily reminiscent of 16z and is also a vigorous investment. He has woven a vast network of resources and relationships into the crypto ecosystem. These big companies have pushed hard.

However, this investment has also drawn some criticism, for example, the founder of Twitter recently tweeted that Web3 is not by real users, but by venture capitalists (VCs) and their sponsors (LP). , it is a medium with different characters and even a16z governs the concept of Web3.

In his view, venture capital organizations can control the token share of a number of Web3 projects and collect huge profits. They are far from their vision and go against the spirit of Bitcoin. Source software that provides the funding.

The above statement has created a lot of controversy in the cryptocurrency market, but this is not surprising given the much speculation on how financial institutions can balance home-linked currency with the public interest. . Other Trends Investment firms may want to reconsider.