This is not an knock on the author, but I think a more thorough report on the years of poor growth Rovio experienced is much more enjoyable and realistic to read. I can't find it right now, but I believe the Atlantic wrote something just like that.
Edit: I should probably clarify, I actually think the bigger issue I have is that the graph is particularly disingenuous, the "hockey stick growth" should follow the company from when they were founded in 2003...10 years ago. It may actually like more like a traditional hockey stick.
Which VC would let you continue after, say, ten failed products?
note: I have no info on whether this is the case for Rovio, but I know the government has been trying to support / set up the Finnish game industry cluster for around ten years, and now with Rovio and Supercell that is finally starting to pay off.
Forcing the general public to fund bringing your ideas to fruition is a completely unsustainable economic model.
Governments all over the world are flat broke from this type of thinking.
Actually most of the cool stuff we have, we have it because of government funding research. Including the very internet.
Can you prove to me they wouldn't exist otherwise? People like Tim Berners-Lee didn't come up with the ideas they came up with because they were government funded. They created things because they were innovative and smart.
The fact that YC exists is proof that government programs are not a prerequisite.
That's orthogonal. And company X's engineer didn't create Y because he was working in the private sector, he created it because he was innovative and smart.
Still, Tim Berners Lee WAS government funded. As was Arpanet. As was TCP-IP. As was most early work on computers. As was lots of basic physics, chemistry etc research before the US had any scientists worthy of mention (in Germany, France, Britain etc).
In Finland the current focus is ensuring that the economy can transition from the failing mobile phones and shipyards to something else, and the game cluster is a part of that.
Update: found an article about the role public funding played with Rovio's success:
Rovio Ltd. has benefited from support schemes by Tekes, the Finnish Funding Agency for Technology and Innovation. According to the public information provided by Tekes, the company received grants of € 379,510 over the years 2005-2007.
In addition, the Finnish Film Foundation, an institution backed by the state, has granted Rovio Ltd. € 50,000 of support for the production of an Angry Birds animation movie. Already before, Rovio had announced cooperations for producing “Angry Bird” films, including a cooperation with 20th Century Fox.
Q: “Hi Peter, could you tell me which physics engine Angy Birds uses?”
Peter (Rovio): “Box2D”
Q: “Great. Would you consider giving credit to Box2D in your game?”
Peter (Rovio): “Yes, of course”
Q: “Thank you! By the way, I am Erin Catto the creator of Box2D”
Peter (Rovio): “Great! I would like to talk to you after the session”
In 1999 Red Hat and VA Linux, both leading developers of Linux-based software, presented Torvalds with stock options in gratitude for his creation. That same year both companies went public and Torvalds' share value temporarily shot up to roughly $20 million
See also http://www.linuxtoday.com/infrastructure/1999121000105NWLF
Especially considering so many sites are fundamentally built on top of open source while being closed source.
If they are successful and the rely on those programs, sure, why not?
That's how you get more support for Open Source software, and more funds for projects that benefit everyone. OSS was moving faster at the late nineties-early 2000s, when huge companies employed tons of people to work on the Linux kernel, libs, frameworks, the desktop, etc, that it does now.
That's why progress has got so slow the last 6-8 years in so many parts of the OSS world (and on lots of proprietary software, that lazily relies on OSS). Things like Gnome or OpenOffice are essentially the same as they were 10 years ago, whereas the proprietary alternatives have gotten tons of changes.
GTK+, the main toolkit behind Gnome has one (1!) major contributor (which complained about the issue). In a proper world, something like this, used by so many millions, should have at least a full time team of 10 persons.
Contrast the additions to GTK+ in the last 10 years with the development of the corresponding Cocoa libs, and it's like night and day. A tree-view widget here, a spinner there, ...
Small libraries and stuff can still flourish under such an environment, but not big, co-ordinated projects.
But then again, they seem to still be receiving some amount of corporate sponsorship from Red Hat.
A few years back (when Nokia stopped supporting the project) things looked a lot more gloomy: http://wingolog.org/archives/2008/06/07/gnome-in-the-age-of-...
Then again, any desktop environment or toolkit is bound to be somewhat unsexy these days when the focus is on web and mobile.
I also wrote about this back in 2008: http://bergie.iki.fi/blog/gnome_in_decay/
I asked my brother how good my nephew was at playing the games on the phone (considering my brother and his wife don't have smartphones) and he responded "they have games too?"
Does this number represent the value of the merchandise sales of the company or was he explicitly referring to the revenue of Rovio itself?
Edit: here's the link to the Finnish officials' records http://finder.fi/Televiestintälaitteita%20ja%20palveluja/Rov...
By comparison, Supercell which has the #1 top grossing app (Clash of Clans) and #4 top grossing app (Hay Day) was reported to have $15M in gross monthly revenue, which is far less than Vesterbacka's statement about Rovio, but closer in line with Rovio's Finnish filing.
Angry Birds Star Wars is currently #46.
Maybe the merchandise and licensing is where the money is at?
They'll sure milk it as much as they can. But having something that successful gives you something that most people can only dream of: a gigantic advertising opportunity for their next games.
At any point in time where they're still relevant, they can just buy any small game company making the next great game and advertize it like mad, making the next great game even more successful than what it would have be.
They could have bought, say, Riot games if they wanted: the chinese forked "only" 400 millions to buy Riot Games / Leage of Legends.
Whenever Rovio shall feel like it they'll be able to fork out an height or a nine figures to acquire the next big game.
Rinse and repeat.
1. $NEXTBIGTHING is tiny and cannot be distinguished from the noise
2. $NEXTBIGTHING is going to be the next big thing, but only a few people can realise this
3. $NEXTBIGTHING is spreading like wildfire - the owners of $NEXTBIGTHING could take 400m from you, or they could take 20m in VC and become the next rovio.
The time period between 1. and 3. is probably tiny compared to the time it takes to broker a 400M dollar deal
Good commentary about the claims:
I asked Vesterbacka for comments when I posted the first version, but he only responded later this afternoon. (I'm now waiting for feedback from the Marketwatch/WSJ reporter where the claims originated).
If you've followed the post, you'll see that I updated it regularly in the course of the day with information from this thread, with a window of a few hours where unfortunately I couldn't update the post because the site went down.
I suppose if that's "all they did" - any of us who could do that could've been sitting on that 3 billion, right? Heck, even the Box2D guys could've done it.
There's a small difference in saying "they should've employed the Box2D guys" or "generously funded the project" and "they should funnel all profits" - perhaps Rovio deserves some credit here for turning a little casual iPhone game into a household name.
Why was Crush The Castle not as successful? Marketing and polish. If your aim is commercial success, it's obvious what your focus has to be.