The founders of new online gaming company Red 5 Studios are celebrating an $18.5 million round of financing today from Benchmark Capital and Sierra Ventures. Bill Gurley from Benchmark Capital is joining the board. The company previously raised working capital from WEBZEN pursuant to a game development deal earlier this year.
Red 5 Studios was founded by some of the key people behind Blizzard’s World of Warcraft, which claims over 6.5 million users. CEO Mark Kern told me that they broke away from Blizzard because they had a difference in opinion over the appropriate strategy for the next generation on online games, and that he’s aiming for Red 5 Studios to be “the Pixar of onling gaming” by creating games that are distributed and promoted by others. Look for their first titles to be launched in a year or so, initially through WEBZEN.
If you are a top gaming talent, Kern tells me, they are hiring. The company also sent us conceptual artwork, which we’ve included below because it looks absolutely awesome. No idea if and when this might be incorporated into a game.
Comments
Why isn’t Pixar looking at this market, if it is so lucrative? Shouldn’t it be a natural progression/extension to their business?
Pixar renders all of the animations for Pixar related rides at Disney parks.
It’s always refreshing to see an internet company whose business plan involves developing a product that they expect users to pay money for (what a concept), but does anyone besides Vivendi make money from online gaming? Are EVE Online or SL or EQ turning a profit?
PS Nick Denton’s going to be all over you for that remark about blue glowing cleavage fantasy babe being “absolutely awesome”. Just sayin’.
wouldnt want to mess with that chick in a dark alley - somehow i dont think i would leave with my balls intact
Pretty cool. Can use some more quality competition in this market.
her fallopian tubes are glowing. creepy…
Um… is EverQuest turning a profit? Well, gee, I don’t know… Why did they call it EverCrack and why was it the definitive MMORPG prior to WoW?
The company got 18.5 million because 1) they were from Blizzard employees and 2) because they were part of the WoW team.
It’s very unlikely anyone else can expect to garner that much VC funds if they want to launch a MMORPG, the space is quite full of players, big and small. I recall reading an article earlier this year talking about 2005’s string of MMORPG games, all 100+ of them.
The evolution of gaming is moving online, it’s now expected and commodity, but even then it doesn’t mean that it’s easy. Video games has always been a product that’s derived from masters of storytellers and creatives.
I went to art school and worked with Bill Petras at Take 2 games…
if anyone can do it, its that kid.
Red 5 will do very well.
Those images are awesome. Can’t wait to see what they come up with. Online gaming needs a Pixar, this is good news.
Can you go into more detail about what “the Pixar of Onling Gaming” means? I’m confused. How is that different from the traditional model of the developer making the game, and then the publisher selling/marketing it?
MMOs make tons of money. WoW may be the 900 lb juggernaut (a gorilla is too small), but games like EQ1, EQ2, EVE, etc are still very profitable. Even hybrids like Guild Wars are very much so in the black.
Then there is also the very profitable secondary market
Pictures look nice, but who cares? Lack of impressive artwork is not what’s keeping modern games down.
Like Jon, I’d also like more detail on the Pixar reference. Is the point simply that Pixar is a successful company, and therefore Red 5 projects itself as successful?
I wish them all the success in the world because they are going to need an aweful lot more money to get this sort of game to market.
The reason WOW was a success in the first place was they were using an existing IP; doing a game of this size with orginal IP is going a hard fight. Ok they can ride the “We created WOW” in the press but that is only going to reach hardcore PC gamers at best.
Oh to the poster above who asked why Pixar don’t do games? its quite simple they stick to what they are good at and partner others for the skills they are not good at IE Games.
The concept art looks good.
It’ll be interesting to see if the first titles make it out of the gate when expected though.
Working in a large company as an development employee is very different to running your own dev co, which the founding Red5 members will no doubt find out…
Odd that they show up here on TechCrunch. I recognize the name because they’re one of the few licensees of the Offset Engine, which made waves a few months ago (and is generally quite cool).
As for the existing IP vs new IP, I don’t really see how that’s an issue. There are plenty of examples of new IP making it in MMORPG, Norrath and Eve come to mind as new IP that are/were successful.
The big questions are when they’ll release and who’s running the games.
The studios that consistently produce hits (Blizz, Valve) seem to do so primarily by slipping the release schedule till the game is polished. I think WoW slipped more time than they’re claiming for development. I’d love to see them pull it off, but unless they’re doing some Spore-like parametric asset generation, the mind boggles at how they’re going to produce the art.
As far as running the game goes, if they’re going to run the game like Sony and Blizz, count me out. I did Eve long enough to appreciate how CCP runs their game. I like that the devs jump on the forums and explain why suggestions are stupid, I like that when the db goes down Valar explains what happened and gives a personal apology, I like that everybody I’ve seen from CCP seems to love their game and that PR is non-invasive, I like how t20 provides data dumps for addon developers. In brief, CCP makes me feel like a customer rather than a revenue generation unit.
cool. gaming’s a huge business, i love watching innovation in this space.
More Blizzard employees leaving to start their own companies huh? Before WoW started, a group of employees left to create ArenaNet and made Guildwars and made a much more unique and original game. WoW is nothing but boring level grinding and mindless gameplay.
Few comments:
1. Glad they got financing, concept art is nice, but let me know when theres a demo
2. Someone mentioned MMO profitability, try a bit of research, its a 26b worldwide market
3. 18m is just about what they need to built a distibutable platform for? eh?
4. On why WOW/Blizzard was successful:
a. Existing IP with a huge fan base
b. 60m+ for development
c. smooth release, polished mass appeal game play
d. lack of high quality alternatives at the time (market timing)
5. The “Pixar of Studios” leads me to believe they’re planning a distributable art/content middleware platform?
Thats a great idea actually, make it compatible with multiverse and partner….
OR
6. If your making a gaming platform, for indie distrobution, well you wont be the first entry, but innovation and ease of use make take you far
Good luck Red 5, maybe I’ll see you at the GDC
It’s an insult to consider Red 5 anything close to Pixar. We don’t want to see Red 5 a sellout to Disney.
The industries are completely different, massive online gaming and 3D storytime don’t fall in the same ball park, they create their own arenas. Yet the truth is that gaming becomes the more profitable for studios and a bigger investment for consumers.
Something to be considered is how WoW was developed previous to the surge of next generation platforms that most gamers are capable of experiencing.
We will be seeing massively improved graphics, AI, interactivity, storytelling, rich soundtracks, online social interaction, and user impact.
If you thought WoW was nice, you haven’t seen the future yet.
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