Social gaming or how I learned to herd sheep with my mouse

First blog, check. Second blog…this is a bit more challenging. Introductions are easy; it’s the follow up that’s a bit tricky.

I’ve been wondering about something lately…social network gaming. Is that something that we should be spending our resources on in an effort to make a potential investment?

You know those annoying ads on the side of your facebook account promoting Mafia Wars or Farmville? For those of you under a rock, they link to the increasingly popular time suck known as social gaming.

I had ignored the trend up until recently when more and more of my “friend feed” is inundated up by who planted what on Farmville, or who whacked who on Mafia Wars http://tinyurl.com/y922lxt

As with all investments that OpenView makes, we look for expansion stage software companies with traction in the marketplace and a continual and sustainable revenue model. So where does that leave social gaming? This is something I am struggling with. It is clear from my own experience but also the article below there is obvious traction and a massive amount of users flocking to get in on the action they’ve been seeing stream across their “walls” http://tinyurl.com/ybzfmch. And don’t forget about Twitter, with their valuation rising so is the rush into tweet games: http://tinyurl.com/lltn3q

So where does this leave growth capital and venture capital investors sitting on the sidelines? I believe that there is serious potential in this emerging trend, if nothing else the sheer amount of people who spend hours on the facebooks and twitters of the world, social gaming is becoming widely acceptable by all demographics. And as the trend moves towards more titles and developers going to mobile devices (Mafia Wars among others is in the iPhone app store) the movement will only continue to grow. But, there is one large barrier; can these companies scale beyond users? Or is this some sort of fad? For now only time will tell.

Until next time you can catch me farming my tomatoes and building up my network of bad guys…

Peter Zotto
Peter Zotto
GM

Peter Zotto is the GM at Price Intelligently. Previously he was an analyst at OpenView where he helped to identify qualified investment opportunities.
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