GameCo, the pioneer behind the first video game gambling machines (VGMs) in the US, is seeking an additional $20 to $30 million from investors.
The funds will be used to expand into new markets and to build upon the company’s suite of products. Those products currently consist of three completed games, with at least two more in development.
The New York-based company has already established a foothold in the land-based Atlantic City casino market, where it has received mixed results.
GameCo goes hard, meets resistance
GameCo first hit the scene in November, when its flagship first-person shooter Danger Arena debuted at Harrah’s Casino in Atlantic City. Terminals were added at two other Caesars affiliated properties — Caesars Casino and Bally’s Casino — in relatively short order.
Tropicana Casino, also in Atlantic City, became the fourth Boardwalk property to invest in Danger Arena. In December, nine terminals were added to the recently renovated property, bumping the total instances of the game to 30.
Reactions to the new product tended toward apathy. This is presumably because first-person shooters don’t resonate with the average casino dweller, who tends to be on the older side and preferences casual games.
Granted, GameCo’s products are designed to engage millennials, but that demographic has proven a tough nut to crack.
More products from GameCo
Despite the lukewarm reception, GameCo — which has raised nearly $10 million in two previous funding rounds — did not rest on its laurels. In February, the manufacturer installed its second game, a Match-3 venture titled Pharaoh’s Secret Temple, in the same four casinos that Danger Arena calls home.
The casual-friendly game has performed more admirably, but has hardly taken the world by storm. Whereas Danger Arena has consistently been a below average performer, Secret Temple has trended closer to average.
A third product, the basketball-themed Nothing But Net, is expected to debut in Atlantic City soon. GameCo CEO Blaine Graboyes has high hopes for the product, claiming:
“I think this might be out first really big hit. It’s so easy to play — just one big button. Anyone can do it.”
In the same statement, Graboyes conceded that Danger Arena might be too difficult for anyone who doesn’t play “Xbox or PlayStation.”
First Atlantic City, then the world?
In addition to releasing upwards of 10 games this calendar year, GameCo has visions of landing in more lucrative markets.
Just last month, the company received certification from Gaming Laboratories International to sell its products in multiple regions that permit real-money slot machines. The company is currently in pursuit of a gaming license in Nevada, so that it may offer its products on the heavily trafficked Las Vegas Strip.
In Vegas, GameCo won’t be the first skill-based game provider. Konami assumed that mantle when it premiered Frogger: Get Hoppin’ at the LEVEL UP entertainment lounge inside MGM Grand. It will however, likely be the first company in Vegas dedicated to skill-based gaming exclusively.
Beyond Vegas, GameCo plans to debut its products in Connecticut casinos in the near-future. It has expressed desires to enter the Asian-gaming market via Macau.
Are GameCo products destined for the NJ online casino market?
Skill-based gaming feels as though it would be a natural fit for the NJ online gambling market.
Studies have shown that the average online gambler in NJ tends toward the younger side, with ages 25 to 44 being the most represented group. This meshes with the demographic GameCo products have captured — 60 percent of players are under the age of 40.
However, to date, there’s been no indication from GameCo that it will actively pursue the regulated US online gambling marketplace.
Admittedly, porting its products to online would present some difficulties. Namely, the games would have to be tested for all sorts of controller configurations.
There’s also the concern that the NJ online casino market, while growing at a blistering clip, is still too niche. Last year, the market generated $170 million in revenue, compared to $2.4 billion for land-based casinos in Atlantic City.
Yet, if the industry’s online vertical continues to grow at a torrid pace, GameCo will be hard pressed to ignore it — especially if the costs of creating online versions of its products are magnitudes lower than developing physical cabinets.