After investing about $100 million in Indian start-ups over the past year, PUBG publisher KRAFTON is now broadening its investment thesis to include sectors like Web3, and deeptech, along with gaming.
BusinessLine spoke to Anuj Tandon, Head- Corporate Development, India and MENA at KRAFTON, about their investment thesis and this year’s plan for India investments.
Why does a gaming company like KRAFTON invest in dating apps (FRND), and storytelling platforms (Pratilipi, KUKU FM)? How does this fit into your investment thesis?
We feel there is a large whitespace in the interactive entertainment sector in India, which includes video games, e-sports, and tech platforms extending to the overall media and entertainment sector. We see that there are underfunded companies in the media and entertainment space specifically and we also see a lot of strategic synergies. So, we have been sort of opportunistic about it.
For example, when you talk about FRND, dating is the second-highest in-app transacting app genre in India. Given, that our games are already monetising, there’s a lot of operational knowledge and benefit that we can give to a company like FRND, which is early in that journey of monetisation. There is a kind of synergy that way and also, we have acquired Between, which is a social messenger app for couples. So there is some strategic synergy in that way.
KRAFTON is also one of the most powerful IP companies globally in terms of the gaming landscape. When we talk about IP, it has multiple forms. Last year, we announced a partnership with a Netflix director for a series on our IPs. There is a lot of pan-entertainment IP penetration that is happening, with gaming companies and entertainment companies coming together. In the case of our investments in Pratilipi, Kuku FM — we support platforms that build out IP discovery. That is our whole strategy over there.
Do you see these IPs converting into games some day?
Potentially, yes. But we are not just thinking about games over here. We want to back these companies because we have seen how in Korea, one IP like a squid game can change the life of a production company or an IP company. We have seen platforms such as webtoons, whose IPs which are now being transformed into Netflix shows, among other examples. So, all these platforms are going to be a long-term creation engine for transmedia IP, which includes games, streaming shows, comics, and audio platforms. That is how we see the world shaping, we have seen that happening in Korea, we see that it will happen in India sooner rather than later.
Have you earmarked any investment amount for the Indian market this year?
In 13 months of active investing, we have deployed around $100 million in India. And that’s not it, this year, we want to go beyond that number. We are happy to invest much more than that, if needed. So there is no end point for us if the right opportunity presents itself. We have done $5 million cheques to $45 million cheques, based on the opportunity. If we get the right opportunity, we’re happy to write bigger cheques. We are stage agnostic, we invest in Series A, B, C and even D rounds.
Any specific sectors that you would invest in?
This year, our thesis is slightly broader. Gaming is essentially our core, we will keep finding the right opportunity in that space. For other sectors like media and entertainment, our focus is going to be on things like deeptech and AI. We are looking at investing in tech and AI more deeply this year. Also, at an overall organisation level, we are focussing on web3 very closely. It does not mean we will be going all out and invest in everything related to web3. There has to be again the strategic synergy of what we can build with these companies.
Web3 investments are going to be about how we can leverage NFTs and what can be our contribution to the creation of metaverse. As a gaming company, our core thesis is to create fun, so that is still going to be there and web3 is just another way for consumers to connect with us in that aspect.