Wargaming Nexus: “We’ll give you $100K to create a prototype”

Mike Belton

Folks from Wargaming Nexus suggested that we meet in “The Great  Restaurant Qin” in St. Petersburg. It looks like a huge block of concrete with claims to constructivism. As we get closer, paper lanterns become visible along with dragons at the entrance, hieroglyphs and other Oriental stuff.

“The largest Chinese restaurant in Europe,” says Nikita Matsokin, business development manager at Wargaming Nexus, as we climb the ladder to the entrance.

The Soviet style interspersed with Oriental decorations suddenly looks very Deus Ex. You know, gray boxes for buildings. Rare bright textures.

Inside, the restaurant resembles a strange mix of a parliament hall and a theater. In the center, there is a huge screen with a red flag and an inscription in Chinese. In front of it, dancers are rehearsing a performance. Tiered terraces surround the stage.

What a weird place for an interview. And yet, it somehow feels appropriate in the light of the ambitions of the Nexus team.

“We want to create cultural phenomena!” says Mike Belton, the head of the recently announced division of Nexus.

“Our approach to publishing is to create products that would become part of modern culture, like World of Tanks,” Nikita nods.

“People often say that World of Tanks is more than just a game,” Mike continues. “And there is a reason for that. We create a whole lifestyle around our product. Many companies look at games as sets of mechanics. We go for something else. We believe that we must build powerful cultural layers around our products. So when we start to work on the concept for a future product, we try to estimate whether it is possible to translate it into a story, into a culture.”

The waiter approaches, we order drinks and then the interview begins.

***

About business and audience

Alexander Semenov, GWO: So you want to create cultural phenomena. It all sounds very cool. But it gives zero explanation of what Nexus is and what exactly you guys do.

Mike Belton: We think of Wargaming Nexus as a multifunctional business unit. It will cover the full range of tasks associated with the product:

• generating ideas;
• prototyping;
• bringing prototypes into production;
• launching products and operating them.

Essentially, it’s a full-cycle unit. It’s a self-contained business, you could say.

Why does the company need another internal studio? You have an R&D department at Wargaming, a mobile publishing division, and investment initiatives. Why multiply entities?

Mike: Because within a large company it is impossible to only focus on some departments or functions and not the others. Not if you want to succeed in this very competitive and high-risk industry. We at Wargaming believe that success is within our reach, but we don’t know which of the entities will get us there.

What is success? It is a combination of certain competencies, ideas, and people that, through certain processes and interactions, leads to an outstanding result. How do you get 100% out of this combination?  Nobody knows. Within Wargaming, there are many different entities that have the same task: creating superhits and bringing them to the market.

Nexus is another entity, with completely different mechanics, approaches to work, but with the same purpose – to make hit games.

Typically, publishers diversify their portfolio by purchasing third-party companies. Instead of that, you create new subsidiaries internally?

Mike: That’s exactly right.

And these internal studios can overlap in functions?

Mike: They can. But these are really separate businesses.

Even World of Tanks on PC is a separate business unit that includes all the necessary functions. This business unit has its own development, publishing and operating departments. This kind of structure ensures the most effective work on the product.

So what’s the key difference between Nexus and other businesses?

Mike: We focus on innovation, design thinking, on creating new products.

And what will this innovation be exactly?

Mike: The innovation is to create new value for players. Not gameplay, not mechanics or monetization system. From the start, we want to build on the needs of a specific target audience.

We go with the audience. We select the mechanics that would suit it. We design the game experience that will resonate with users and hook players.

How do you typically discuss concepts? You choose a genre, for example, match-3. Then you come up with ideas how to make the new product appeal to the existing audience of this genre. This is not our approach.

Instead, we begin by defining a potential target audience for our future products. We study this audience in depth. We figure out what this audience will appreciate, why and how an abstract game can become part of people’s lives.

This is our main difference from other units.

The other one is technology. Wargaming has not always used Unreal Engine 4 to make games. We studied the technology and signed a studio-wide agreement with Epic Games to use their engine for our new products. We at Nexus believe that Unreal Engine 4 is perfect for making mobile AAA projects, which can then be adapted for other platforms.

Nexus also has a slightly different corporate culture, it’s more dynamic. We try to be as flexible and as fast as possible, to instantly test and develop new hypotheses.

I did not quite understand how exactly you are going to go with the audience. Can you give a specific example?

Mike: Let’s say there is a hypothetical John. He lives in the US. He gets up at such and such a time, has breakfast, works, and then he has ten spare minutes to reads the news.

That means we’ve got ten minuates to offer our product. We try to figure out what kind of gameplay will suit him, how exciting it will be for him so that our pal John can read the news and play our game, all of which should only take ten minutes.

Then we study how many other people like John are there in that region, and maybe there is this whole audience that we can reach within these ten minutes. Then we try to understand what product can unlock this audience for us.

Nikita: Audience drives us. End users inform our development decisions. We don’t just pay attention to what users play. We look more broadly at what their interests are, what excites them. We look at what would motivate them to play. If they play strategies on their smartphones, we try to break down their motivations: what is important for them in the game, why they return to it.

But that’s completely different from how you made World of Tanks!

Mike: Is it though? Maybe we did not have this precise methodology then, but now, after some thorough internal analysis, we clearly understand how and why the game really took off.

About Unreal Engine 4

You have chosen Unreal Engine 4 as your primary tech. This is a great engine for console and PC, but it’s rather heavy for mobile. Why didn’t you use this engine to work in console gaming?

Mike: At Wargaming, several teams work with Unreal Engine 4. Some of them work on console projects. So we try to approach this technology from different angles.

But when we talk about console and PC, this is usually understood to be the mission of the big Wargaming.

Why did we choose Unreal Engine 4? One of our main tasks is to quickly launch products, develop them as brands, and then bring them as quickly as possible to other platforms.

We do not want to develop a product for console for three or four years and only then port it to mobile. We do the opposite.

Nikita: Last year, Wargaming conducted a comprehensive analysis of all the technologies available on the market. We chose Unreal Engine 4 based on this evaluation. When studying the engine, we identified the moments that are most important to us:

• rapid prototyping of 3D shooters and action games;
• the ability to create games with highest quality graphics for mobile devices;
• the engine has a very good cross-platform capacity.

If we, for example, make a hit with Unreal Engine for mobile, then we have a clear and precise way to further develop this product using the existing technological stack for other platforms.

Mike: Over the past six months – before Nexus was announced – we worked with 22 studios. Our theory that 3D games can be quickly and efficiently prototyped with Unreal Engine checked out. It is well tested.

About partners and projects

What kind of partners are you looking for now?

Mike: We have clear criteria for choosing developers that we want to work with. For example, we look at whether a studio has previous experience, a portfolio, at least one decent mobile release, whether there is a systemic understanding of game development processes and culture, whether they understand how to work with the server infrastructure for multiplayer projects, etc.

Nikita: We want studios to have the product thinking, to understand how to develop a product from prototyping to release.

What kind of product?

Mike: The kind that matches our portfolio. We are not working with hyper-casual and casual games now. We know we are not going make a match-3 title. We are interested in complex AAA games. Ideally, our partners should have experience developing competitive 3D online games. Shooters or action games.

You mean, for mobile?

Mike: Yes. The experience developing games for mobile is very important. For example, control system in a mobile project is very different from controls on other platforms. So if we want to effectively work on mobile products, it is important that the studio should have a clear understanding of mobile UX, the platform’s technological and other features.

We have collaborated with studios that did not have experience working with mobile at the time. Let’s just say that was suboptimal.

How so?

Mike: For example, a studio can create stunning visuals, but at the same time, there are big problems with UX. Or maybe they are not very good at iterating stuff. It’s because their thinking is not specifically geared towards mobile.

Are there any other requirements?

Mike: Motivation to release successful products.

Is this something you can check?

Mike: We communicate with the studio, we see how ambitious the staff are, whether they understand the market and the trends, whether they have game design expertise. If they do, chances are they are going to like working on new products with us.

About prototypes and funding

What exactly are you offering? Are you investing or are you buying?

Mike: For starters, we fully finance the prototype. This is just a preliminary stage where we test hypotheses that were laid down while developing concepts for the new product. We also get a sense of the studio.

Once the prototype is complete, we work with the studio to identify ways for subsequent interaction. We can develop the product together. Or it can be a strategic partnership. This is very case-by-case.

How do you evaluate prototypes? And how do you evaluate the experience that you’ve had with a studio?

Mike: There are many aspects to this. During prototyping, we work closely with studios on development, game design, we playtest intermediate results and check hypotheses. The results of the prototyping stage are evaluated by our technical director and game designers. They assess competencies of the studio. We evaluate the prototype itself in terms of the quality of development, hypotheses tested at the concept stage. We consider the projected target audience and the product’s market potential.

We have a comprehensive review and testing process for projects in development, from the concept stage to global release, with decision gates when we can greenlight the project.

Nikita: With studios, we move step by step. First we finance the development of prototypes that are based on the concepts that we have created internally after analyzing the audience and the market. Then our product team evaluates the efficiency of the teamwork and the quality of the prototype. If the prototype looks promising, we test it inside Wargaming, but also give it to the test audience of the future game. We see how focus groups react to the prototype, and then we can make the decision on whether to proceed to production with that studio.

Can you say how much you are willing to invest in a prototype?

Mike: We have certain budgets. We are ready to invest up to $100,000 in each prototype if we work with a studio from the CIS and Eastern Europe. This is an adequate budget that allows you to build a minimum viable product and test all the initial theories.

So if a team comes to you that has already made a mobile shooter and wants to make another one, you are ready to give them $100,000 for the prototype?

Mike: Yes. Usually, when studios learn about the size of potential investment, they start to quickly adjust the projected costs (laughs).

Nikita: We are not going to be hard-line about $100,000. We understand that studios from the USA and Western Europe might require a special approach. Everything depends on the specific project, prototype and mechanics. Anyway, it’s our default budget.

If a prototype passes your internal greenlight and goes into production, is it no longer limited in funding?

Mike: We have some boundaries, but at the development stage decisions are made on a different level and are based on the detailed documentation, plans, and road map. We discuss budgets for development, but also for marketing. Obviously, we are dealing with very different figures when it comes to development and publishing.

In the CIS market, there are not a lot of companies that meet your criteria. Most of the CIS mobile studios are famous for casual projects. How strict is the requirement for a studio to have a mobile shooter experience?

Mike: If there is an interesting idea that has a high potential, we are happy to talk. However, our current focus is on the studios that have developed shooters and action games and have the relevant expertise.

You mentioned that Nexus has actually been operating for half a year. That was enough time for you to have partnered with 22 teams?

Mike: Not all of them made it to the prototyping stage. With some studios, we only made it as far the discussion of prototypes, and then parted ways. Six studios were able to successfully proceed to prototyping, and we evaluated our collaborative experience and the hypotheses behind the prototypes. Anyway, only one studio at the moment has created a prototype that we plan to greenlight for joint development. That’s what the funnel has looked like so far .

Nikita: Even if a prototype didn’t go into full development for some reason, we can continue working with the studios that made it. If we think that the collaboration was fruitful, we will continue prototyping with them on a long-term basis until we arrive at a prototype that will be worthy of players’ attention as a complete product.

I see. Thank you for the interview.