September 30, 2013 / 10:49 AM / 4 years ago

Finnish Grand Cru looks beyond Supernauts launch

HELSINKI (Reuters) - Grand Cru, widely seen as the next big player in Finland's gaming industry which has spawned the likes of Rovio's Angry Birds and Supercell's Clash of Clans, is already working on a new game although it has yet to launch its first.

Chief Executive Markus Pasula started the company in 2011 with seven other gaming industry veterans. The founders' experience has helped them secure nearly 13 million euros ($18 million) in funding, including 8.5 million euros in July from a group led by French private equity investor Idinvest Partners and including Qualcomm Ventures and Nokia Growth Partners.

The funding has meant there is no hurry to launch its first game, Supernauts, which includes challenges such as saving people from flooding as polar ice caps melt.

"It could be this year but it might not be this year," Pasula said of the launch. Speaking to Reuters as part of the Reuters Nordic Investment Summit, he said it was still in limited beta mode and would soon be tested more widely.

"We're looking to do a bigger beta launch almost this week," he said in an interview at Grand Cru's office in Helsinki's working class Kallio district, with views over the harbor and neighboring industrial warehouses.

Pasula said he was also starting to look beyond Supernauts.

"We have one new team already starting, it's still looking for a lead programmer for that team, but they have a really good designer," he said, adding that there were also ideas for a third game.

The gaming industry is considered one of the few bright spots in the small Nordic economy, with previous tech flagship Nokia NOK1V.HE selling off its struggling handset business to Microsoft (MSFT.O) and traditional industries such as paper shutting mills and cutting jobs amid a decline in global demand.

MOBILE CULTURE

Pasula said Finland's gaming companies may have been successful due in part to an early understanding of the importance of mobile gaming.

While he does not recall hiring any of his 32-member staff from Nokia, he said Nokia's success and the culture it created helped encourage developers to focus on mobile games.

"Nokia definitely supported that. Nokia was spreading the message in the local scene that mobile gaming is going to be a big thing," he said. "Every signal shows that mobile gaming, especially the free-to-play gaming on mobile, is going to grow every year significantly."

Supernauts is being built for Apple's (AAPL.O) iOS system. Pasula said the primary target was the regular, rather than hardcore, game player using a mobile device like the iPad. Games for Android software may come later, he said.

Pasula previously headed Mr.Goodliving, a Finnish video game company that specialized in games for mobile phones and was acquired by RealNetworks (RNWK.O) in 2005.

While U.S. gaming companies such as Zynga Inc (ZNGA.O) and Electronic Arts (EA.O) have grown through acquisitions, Pasula said he had no interest in selling Grand Cru.

"We don't have any particular exit plan in mind," he said, adding that big players did not appear to have much advantage over small, unique startups. "We do plan taking Supernauts as far as it's possible, so when the game is successful we'll start looking at how do we take the universe of Supernauts further, and how do we improve the game as a service."

Finnish startups often have trouble securing seed investment due to a lack of venture capital at home, but Pasula said the need to appeal to overseas investors has meant they often aim for a global, rather than just local, business.

"They are more international from the get-go," he said.

He said Rovio and Supercell have helped to boost recognition of Finnish gaming companies overseas.

"It is so fantastic that we have the reputation now," he said. "All of my visits with Grand Cru to San Francisco to go meet all marketing partners we have there - Apple and Google (GOOG.O) and Facebook (FB.O) - they all just instantly recognize that we are a gaming company from Finland." ($1 = 0.7385 euros)

Additional reporting by Jussi Rosendahl and Terhi Kinnunen; Editing by Mark Trevelyan

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