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Alex St. John is back. The former president of social network Hi5 sold off the struggling service to Tagged in December. But now he is starting a new site, Magi.com, that uses many of the same ideas that were meant to boost social games on Hi5.
The new Emeryville, Calif.-based company will enable Facebook games to be effortlessly adapted to Magi.com, where gamers can use their real Facebook identities or play anonymously if they choose. The site will also use some novel tricks to try to draw in gamers. If it works, St. John will revive his dream of creating a rival social gaming destination to Facebook.
It’s a brash plan but one that fits with the style of St. John, who once wrestled a 350-pound Japanese sumo wrestling champion as part of a publicity stunt for Hi5.
“It’s a coincidence that Zynga is becoming a publishing platform, but we are doing this with real and anonymous friends,” said St. John in an interview with VentureBeat. “It does anonymous friend matching, but you can invite real friends and they can see who you are. It also does not sit behind a registration wall like Zynga has.”
St. John said that it didn’t make sense to try to retrofit the social gaming strategy on top of an existing general-purpose social network like Hi5 that was also trying to tout features such as dating and photo sharing. Magi.com can promote gaming to all of its users because it will be a social gaming site from the very beginning.
“It’s smarter to have a pure game site,” he said. “Hi5 was a real identity social network and that was holding us back. Do you want your boss to know you are playing social games all day?”
So while Tagged bought the social network, Magi.com retained rights to new social gaming features. Those include the Mojo Market, a free virtual goods platform that enables players to acquire virtual goods for all of the site’s games.
Magi.com has cloned Facebook’s applications programming interfaces. That means it takes almost no effort to adapt a Facebook game to run on Magi.com.
“We really appreciate the partnership approach the Magi team has taken towards developers. Their platform is trivial to integrate with and their business terms are very developer friendly,” said David Whittaker of game developer DJArts.
The Mojo Market has an interesting twist. Players can bid on and win virtual items and cash-valued prizes with the Mojo points they earn from playing games, socializing, and purchasing in-game currrency. The live auction will help gamers set the value of the goods that are being sold.
“It’s like an eBay, where players can bid on goods they win in games,” St. John said. “If you run out of energy in a game, you can buy some more.”
The site is now in beta testing with social games from DJArts, HitPoint Studios, and Pixee Games. Those companies will also provide the Mojo Market with the first virtual goods available for auction. Magi.com is now recruiting more developers to publish their games on the new platform. Populating the store with free gift cards (that users can bid for) will be a draw, St. John said.
Magi.com has partnered with InComm, the leading provider of gift cards and prepaid game cards, to support the Mojo Market with virtual store-valued gift cards from partners such as Apple’s iTunes, Playfish, Gaia, Habbo, Perfect World and others.
In addition, Magi.com is the launch partner for InComm’s new Retail Transaction Gateway service, which enables completely electronic sales and fulfillment of gift cards. In other words, players can win codes for gift cards without ever having to obtain a plastic card. If a player wins an auction to buy an iTunes card, Magi.com can simply give the player a code that can be used for redemption in real-time.
Such innovations will help draw gamers. St. John said his approach will be to give gamers a lot of free items in order to attract them. That, in turn, should help lure publishers. But it’s still a daunting matter to compete with a giant game platform such as Facebook.
Magi.com will also offer good terms to developers. For fewer than 25,000 users, developers keep all of the revenue. For more than 25,000 users, developers share 25 percent of the revenue with Magi.com.
Magi.com has 30 employees, many of whom previously worked at Hi5. Now the company has bridge financing from Hi5’s investors, Mohr Davidow Ventures and Crosslink Venture Partners. Later on, St. John expects to raise a round of funding. As for competition with Zynga.com, St. John said, “they are gummed up with Facebook.”
VB’s research team is studying mobile user acquisition:
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