One-Trick Pony Angry Birds Thinks It's Worth... Well, More Than You Can Imagine
Rovio, maker of Angry Birds, thinks it is worth more than the $750 million Electronic Arts (EA) just paid for PopCap. However, PopCap has a bunch of successful games; Rovio, by contrast, has one very over-extended brand.
Sounds like an oversubscribed IPO waiting to happen!
Ville Heijari, Rovio's VP of franchise development, said while the company wasn't interested in being bought, "the valuation from our point of view is somewhere, I dunno, maybe north of PopCap." Trouble is, with games like Bejeweled, Plants Vs. Zombies and Peggle, PopCap has a proven record of creating hits.
Rovio's stable of game titles -- once you get past Angry Birds and Angry Birds Seasons -- includes Bounce, Burger Rush, Wolfmoon and many more games you've never heard of. Don't count on that changing any time soon. The company has stopped working on anything but the Birds.
Not milking the franchise
Heijari also claimed Rovio isn't interested in just milking the Angry Birds franchise. He's right, of course. The company isn't milking it -- it's bleeding it. It's already got plush toys, a board game, t-shirts, hoodies, crystal phone cases, clocks, hats, skateboards and flip-flops. That's just the start.
Coming soon: A cookbook with recipes like "Lacto-ovo Vegetarian Zucchini" (no barbecued Evil Pig?) and a movie. Nor will the overexposure stop there. Its deal with Fox to promote the movie Rio was just the start. Expect to see many more deals with any advertiser interested in paying.
Rovio claims it is profitable and that last year its annual revenue grew 300 percent, but that's self-reported. All we know for certain is that it took in $42 million in venture funding earlier this year. What's odd about that is the spin around the funding. Rich Wong, whose Accel Partners was among the investors, said, "They didn't really need the capital. It took them [presumably here Wong means "us," as in "Accel"] a while to convince them of the ways we might be able to help." So why split the pie if you don't need cash?
The next Hello Kitty?
The company clearly has hopes of turning itself into the next Hello Kitty, Sanrio's mega-superstar character. If its claim of being the third most copied brand in China is true, then the company may have a shot. "We want to be the most copied brand in China," said Wibe Wagemans, who heads the Finnish company's brand marketing efforts. Wageman's previous job was with Microsoft's (MSFT) Bing. Any wagers as to why he left?
There are already indicators the Birds may have jumped the shark, though. There is no surer sign of doom than a U.S. presidential candidate naming a product in an effort to look like he or she has a clue. Michelle Bachmann recently told a 7-year-old Texas fan: "Angry Birds is it -â€" that's the happening thing. Maybe when I come back, we'll play together."
Time to start looking for a new flavor of the month?