Interested in learning what's next for the gaming industry? Join gaming executives to discuss emerging parts of the industry this October at GamesBeat Summit Next. Register today.
AO Labs has raised $4.5M for its Spacebar community-driven Web3 gaming platform through a token sale. Its backers are a who’s who of Web3 gaming.
AO Labs is a virtual studio started by gaming and tech veterans Joony Koo and Christy Choi. They believe that gaming will lead the way to Web3, the vision of a decentralized internet envisioned by blockchain believers. They’re making a casual game that the community can help build, but they aren’t saying much about it yet.
Yield Guild Games led the round, with participation from 70 investors who include some of the biggest names in crypto and gaming. They include Gabby Dizon, CEO of of YGG; Balaji Srinivasan and Sandeep Nailwal of Polygon; Jeff “Jiho” Zirlin of Axie Infinity maker Sky Mavis; and Kyu Lee of Com2uS.
The studio’s mission is to build a playground for Web 3 communities. AO Labs is committed to building a community-owned, open-source game platform called Spacebar, said Choi and Koo in an interview with GamesBeat.
“I think gaming will probably be the piece that actually engages all these different building blocks across crypto,” Choi said. “That is why I am extremely bullish about building this game because it could be the gateway to drive mass adoption. It’s not just because the game is fun. It is because while playing the game, you will interact with all the different tools being built in this space. We will act as a point of interaction for all these people in crypto.”
Spacebar is a space-themed casual game that integrates Web 3 tools including decentralized identification system, decentralized finance (DeFi), non-fungible tokens (NFTs), and game guilds. The company isn’t saying yet what kind of blockchain technology it will use.
The seed round investors are all angels and are leaders in Web3 from some of the largest protocols, networks and funds in the world other than YGG.
“Spacebar truly believes that a game that is both fun and built together with the community can bring the mass adoption of Web 3 and crypto. Spacebar’s builder-only raise is an important first step in building a community-owned composable game,” said Koo.
Choi said, “We are committed to building a game that is sustainable in its growth and fun for users not only from the gameplay itself but also by the fact that users actually participate in the making of the game and its governance.”
YGG’s Dizon said in a statement, “YGG is excited to back the AO Labs team in their mission to accelerate the ownership economy and composability through games in Web3.”
Spacebar will launch its first game in the coming months. The team includes alumni from Binance, Kakao, Coupang, Com2uS, Disney and venture-backed startups.
I meet Koo years ago as a judge for the International Mobile Gaming Awards (IMGA). Koo was the chairman of the jury for the IMGA, and he got to see a lot of good mobile games in that position. He also served as chief operarting officer at Binaree and was head of business development at Block Crafters in South Korea. Choi was a founding director at Binance Labs, which invested in a wide variety of crypto and early-stage blockchain startups. She served on the boards of multiple companies.
“Joony had been talking about build this game for quite a while, and so we got started,” she said. “We were thinking about the best fundraising model for us. We wanted to empower the community and build a game where we built the game with the community. We felt we shouldn’t go to the funds at first. We went to all the founders in the Web3 space, people that we trust, and asked them for money.”
While they succeeded in raising a round, they aren’t yet ready to talk about what kind of game they are making. But the company is hiring
Choi and Koo said they know that valuations for startups go down during a bear market, but the best things with cool technology can still raise money. The companies that make real games can thrive, and that’s what AO Labs wants to do.
“There has to be a reason why users want to play a game,” Choi said. “It’s going to be a different kind of fun. The users will have fun building the game and having control over how they define fun. That’s an angle that we are trying to tackle.”
AO Labs has a prototype it is working on, and it will change in the coming months, Koo said.
“We are putting together a lot of different ideas around what this means,” Koo said. “To me, it feels like redefining what blockchain games are, like going back to 2009 when everyone’s definition of mobile games changed. We think of it as something like a native blockchain game. The genre itself is very difficult to define.”
They are borrowing some ideas from esports and user-generated content, combined with Web3. But the core team will be curating assets to provide to players. It will be arcade-like, with simple leaderboards.
“The subtlety is we curate really well, and we’re not just following whatever the users tell us to do,” Koo said.
Players will be able to earn money selling assets in the game. It will have major updates and users will be involved in those updates. And it’s more like a mobile game than a triple-A title. Just as happened with mobile games, Koo doesn’t think you can make a great blockchain game by converting a triple-A game into a blockchain game. He thinks native blockchain games will triumph. They want the game and its tech to be interoperable with other games and to have composability. They want a good user experience where the players are empowered to use tools to make the experience more fun.
So the company is starting from the based of crypto fans who are already part of the community. The company has six people now, spread out around the world. The company hopes to hire aggressively and possibly come out with something next year. It is looking for people versed in both blockchain tech and game development. Ultimately, they expect to launch a token that could be used for governance, or giving players some kind of say in updating the game.
As for critics of blockchain games, Koo remembers the beginning of free-to-play games, when everyone was criticizing the games for being shitty. The same is happening now, but that doesn’t mean all of the Web3 games are going to be bad, Koo said.
“We’re in between now,” Koo said. “If we are like Supercell making a game in 2010, then we are trying to become the native blockchain game company that understands the inside and the outside of making a game on blockchain. The transition is what we need to work on and understand.”
GamesBeat's creed when covering the game industry is "where passion meets business." What does this mean? We want to tell you how the news matters to you -- not just as a decision-maker at a game studio, but also as a fan of games. Whether you read our articles, listen to our podcasts, or watch our videos, GamesBeat will help you learn about the industry and enjoy engaging with it. Discover our Briefings.