Dipping Deeper Into Publishing, Kabam Launches $50M Fund To Bring Japanese Games West

With Japan’s Puzzle & Dragons pulling in an astonishing $62 to 86 million in just the Japanese market last month, it’s no surprise that Western game developers are looking to cherry pick more hits to bring back to West.

Kabam, which is on track to pull in $200 million this year, is launching a $50 million fund to bring Japanese games into the West. Gaming giants like DeNA, GREE and Zynga along with mid-size developers like Pocket Gems are getting deeper into publishing third-party titles. The news was first reported in a Wall Street Journal interview with Kabam CEO Kevin Chou.

It’s a way of de-risking the hits-driven nature of the gaming business by relying on outside creative content. At the same time, these companies promise indie developers greater reach and traction than they might have by going it alone. Marketing costs for games have gone dramatically over the last two years and the biggest mobile developers routinely spend several million dollars on marketing every month.

DeNA, which is one of Japan’s biggest freemium mobile gaming companies, has had success in the past with bringing card battle games like Rage of Bahamut to Western markets.

Chou didn’t reveal specifics about the specific revenue share that Kabam would take except to say that it would be less than 30 percent. It sounds like the benefits are pretty standard for any porting or publishing program; Kabam will help out with localization and marketing. The company will also provide tracking analytics that will help developers monitor user acquisition and retention.

Kabam, which was one of the early social gaming companies to do midcore titles on Facebook, has done a hard shift to mobile platforms over the last year with titles like Kingdoms of Camelot. Earlier this year, the company said its mobile business is on track to do more than $100 million in annualized revenues.

Licensing partnerships have also led to Lord of the Rings-themed games like The Hobbit: Kingdoms of Middle-Earth and The Hobbit: Armies of the Third Age.

Those titles have done well enough that Warner Bros. and Metro-Goldwyn-Mayer Studios Inc. did a strategic investment in the company.