Rick Thompson is hoping that lightning strikes another time. Thompson was the chairman and co-founder of Playdom, the social game company that Disney bought last year for as much as $763 million. Now he has started a new game company, Wild Needle, focused on social games with a location twist.
“Wild Needle represents a shift in the way smart money is thinking of social games,” Thompson said in an interview.
It used to be smart to invest in a game company making social games for Facebook. But Thompson is putting money on the idea that mobile is becoming a larger opportunity. His six-person company will focus on making games for the iPhone and then expand to other mobile platforms. Japan’s DeNA validated this “mobile first” strategy when it bought iPhone game publisher Ngmoco earlier this year for $403 million.
Thompson said he isn’t looking for a similar transaction anytime soon. But because of Zynga’s dominance and Facebook’s crackdown on viral distribution, he doubts that small startups can make an impact on Facebook.
Mountain View, Calif.-based Wild Needle has raised $2.5 million in funding from Thompson and Shasta Ventures. Thompson said that he didn’t need the money to start the company, but he did want access to Shasta’s managing director, Robert Coneybeer, who is joining Wild Needle’s board. Wild Needle’s other top executives include Heidi Carson (vice president of product), Chris Kirmse (vice president of engineering), and Minglei Xu (software architect). Thompson also was founding chairman of online ad networks Flycast and Adify. Kirmse is a veteran game developer who worked at Xfire and was the co-creator of Meridian 59, the world’s first 3D massively multiplayer online game.
Thompson said that there is enormous untapped potential in mobile games that use a device’s location awareness and its always-on connectivity to a social network. Mobile games have lower distribution costs and potentially new kinds of game play around location awareness. Smartphones are also likely to be ubiquitous.
“Things go in cycles,” Thompson said. “Facebook is very challenging for startups now because of high-distribution costs and lack of virality. He said he has investments in a couple of Facebook game companies, one of which is Funzio.
Thompson said Wild Needle is aggressively hiring now. Dan Yue, co-founder of Playdom, and John Pleasants, who was CEO of Playdom, remain at Disney. Thompson said the company’s first game will be targeted at women and feature cool game play. He said he doesn’t think he has direct rivals, but other location-based game companies include Foursquare, Gowalla and Booyah.