A changing of the hoodie at Rovio, the Finalnd-based creator of the catapulting Angry Birds series of casual games that has seen its profit fall by more than half in the last year: its CEO Mikael Hed is stepping down, and he is passing on the reigns to Pekka Rantala, who had been chief commercial officer, and before joining Rovio was CEO of Finnish drinks maker Hartwall and also spent many years with Nokia. In the words of Rovio, Hed is “passing the hoodie”, to Rantala, a nod to how its execs are known to don red hoodies as their corporate uniform.
“It has been an amazing ride and in the coming months I will be very happy to pass the hoodie to Pekka Rantala, who will take Rovio to the next level,” Mikael Hed said in a statement. “Pekka is known to be a great leader with experience building successful global consumer brands. I will continue to play an active role and will support Pekka in any way I can to ensure Rovio’s continued success.”
The two are certainly trying to play this as a friendly transition as you can see in the picture above, with Hed on the left and Rantala on the right, amidst a whole lot of Rovio merchandise.
The move comes at a critical time for the company. Although Rovio’s Angry Birds gaming franchise effectively defined and led the mobile gaming genre for several years, more recently it has been supplanted by a number of other titles and gaming studios. The company still counts Angry Birds in the top 100 paid apps on iOS (number 29) but it’s out of the free top 100 ranking these days.
At the same time, the company’s forays outside of gaming — into animation, lots of merchandising and publishing — have at times proven to be huge business, but ultimately seem unable to sustain the company without the core popularity of the games as a leading force. A lot of that strategy has been spearheaded by Hed.
The strategy to build out branded franchises into other categories has set Rovio apart from other mobile gaming juggernauts like Clash of Clans maker Supercell, which have opted instead to push games in a free-to-play model, selling extra features within the games themselves, as their main revenue generator.
In 2013, the most recent year that the company has reported (in April), Rovio reported €156 million ($216 million) in revenue, up from €152.2 million in 2012, but net profit was €26.9 million ($37.2 million), less than half the €55.5 million of net profit reported in 2012.
The handover will be official on January 1, 2015 — although there is already a transition process in place, the company says. Hed is part of the family that founded Rovio, and the company says that its chairman, Kaj Hed, has nominated Mikael to stay on the board of directors and as the chairman of Rovio Animation Studios — one of the many areas where the company has branched away from games in its bid to be the next Disney.
Its first full length animated film is due out in 2016.
Rantala is an interesting choice to succeed Hed as head (excuse the pun). Most immediately, he comes from a consumer packaged goods background, with time at Fazer before Hartwall, but also cut his teeth for years at Nokia — 14 years, to be exact. This effectively places him in a position to be able to address and build both sides of Rovio’s business as the company has developed it over the past few years.
Hed’s departure is one of a series of executive changes at Rovio. Others have included appointing Jami Laes its new executive vice president for games. Meanwhile, the EVP he replaced, Petri Jarvilehto, left to co-found a gaming startup called Seriously with another ex-Rovio exec, Andrew Stalbow, who led strategic partnerships out of Los Angeles.