Annabel Palmer talks Grand Theft Auto and going East with Paul Sulyok, founder of commerce platform Green Man Gaming
COMPUTER games have come a long way since Spacewar! was created in 1962. Last year, Grand Theft Auto V took $2.2bn (£1.33bn) within its first week after launch – a feat even Hollywood’s biggest blockbusters would struggle to match. And Green Man Gaming (GMG) – a data-driven, social commerce platform for core video gamers – is one of many businesses trying to tap into that marketplace, which reached $79bn in global revenues in 2012.
GMG has seen 300 per cent year-on-year growth since its 2010 launch. The business offers core gamers (those who list gaming as their primary hobby, and spend $720 each year on it) a commercial website that exclusively sells video games. But it also provides a social network, where gamers can communicate with one another.
The customer knowledge GMG acquires from this network means the company will know “when a customer has bought a game, how far through it they got, and whether they were an early adopter,” founder Paul Sulyok tells me. “We then take this data and combine it with our commercial proposition, making us very efficient at selling computer games. It’s our key differentiator: none of our competitors, many of which are much bigger than us, has the depth of research that we have on our gamers.”
Sulyok’s CV makes for some interesting reading. After graduating from university, he spent six years in the British Army before pursuing a career in management consultancy. In 2002, he set up his first of three companies. That business produced algorithmic trading engines in the equity markets, but when it started to naturally evolve into a specialist consultancy (“we started selling our skills and our labour, rather than the technical platform we wanted to build”), Sulyok moved on.
Second time around, he learnt an important lesson. “You can have a great idea, but if there isn’t a market for it, you won’t get your business off the ground.” The company was a hybrid of computer games and gambling, but despite angel and institutional backing, it “made no money at all”.
With GMG, he says the biggest obstacle has not been market penetration. In fact, it’s the one he’s facing now: scaling up. “We’re having to temper growth with customer service and with the exhaustion of our team. The balance of growth and stability is incredibly hard: we have burnt people out.”
Currently, the business is backed by Eden Ventures. Why did they invest? “When I approached them, we literally had a piece of paper and an idea. But they thought it was good. Several meetings later, they put in a small investment.” That has since grown over time, and Sulyok may consider seeking further investment this year.
What’s more, GMG has been chosen to take part in the government’s Future Fifty programme – which connects high-growth companies with expertise and tailored support to help them scale rapidly. It only selects companies it predicts will float within three years, which suggests Sulyok’s ambition for £100m in net revenue in the same timeframe could be achievable.
While the success of his business relied on a robust tech platform in the early days, Sulyok confesses his core expertise is not technology. “It’s managing and leading. I’ve always been a leader. It’s probably why the Army plucked me out of the crowd and sent me to Sandhurst. It’s probably why I did a good job while there. And it’s no doubt why I was head boy at school.”
So in those early days, Sulyok’s time was spent tapping on doors looking for games publishers. “To begin with, the only people who signed up did so because they knew me, or one of our two non-executive directors. It was tough,” he says. But by May 2010, he had a catalogue of 500 games from 26 publishers, and the business was ready for launch.
In December, Sulyok was one of 120 delegates on David Cameron’s trade mission to China. He now strongly encourages fellow small-business owners to look to Asia for new opportunities, writing in a Telegraph blog that Asia offers them a “rapidly growing consumer marketplace,” in want of “UK creative outputs like Grand Theft Auto”. So is the UK government doing enough to boost entrepreneurship? “What it’s doing is bang on. As a British entrepreneur, I’ve got protection from the Enterprise Investment Scheme for my angel investors. And we get research and development tax credits, the lifeblood of any tech company.”
What advice would he give to future entrepreneurs? “Don’t do it with your own money. There are very experienced people out there who will want to invest in your business. Find those people, and work with them.”
Sulyok acknowledges that there is a limit to his skill set, and that, at some point, he will “require someone else to take this business over”. For now, however, he wants to take it as far as he can. With predicted revenues in the video games industry of over $90bn by 2015, who can blame him?
CV PAUL SULYOK
Company name: Green Man Gaming
Turnover: Projected growth forecast for the next three years is above £100m in net revenue
Founded: 2009; launched May 2010
Number of staff: 55
Job title: Founder and chief executive
Lives: The Chilterns
Studied: Economics at Leicester University
Drinking: Oranjeboom (served from Mabel’s Tavern in Bloomsbury)
Reading: Sniper One, by Dan Mills
Favourite business book: The Lean StartUp, by Eric Ries
Talents: Being able to lead people when things go bang; staying focused when under pressure, and having an analytical approach to problem-solving
First ambition: To be a soldier
Motto: “Get up, crack on”
Heroes: My dad, who served in the Second World War and was a prisoner of war in Soviet labour camps for seven years