The Economist calls gaming “the fastest-growing and most exciting” facet of the media industry. And one of the most notable up-and-coming companies currently operating within that industry is Soul and Vibe Interactive (SOUL) . A multi-platform company, Soul and Vibe both develops and publishes games and game-related content for personal computers, mobile, and consoles, working with both indie start-ups and the biggest names in gaming to bring their products to the market.
We got a chance to talk with CEO Peter Anthony “Tony” Chiodo about the Soul and Vibe’s history, their newest products, and why the Soul and Vibe team is incredibly excited about the future.
EQ: Could provide us with a brief overview of Soul and Vibe and its operations?
Chiodo: Sure. So Soul and Vibe is a video and computer games company; we’re a publishing company. We publish games on consoles such as Xbox 360, PlayStation 3, mobile devices that run the gamut of your Apple iOS, Android and your Windows platforms as well as personal computers. For the purposes of this discussion let’s look at personal computers as a combined category of PC and Mac and browser-based systems such as Facebook.
We are one of only 60 companies in the world that has actually been approved by Microsoft (MSFT) as a publisher of content for their console platform. Over a year ago I visited Seattle and gave a formal presentation to the company. I met with a lot of guys within their whole portfolio committee and basically walked them through our plan, our products, our processes. And what was nice was we were told within an hour of the presentation that they were so excited by our presentation that we were the new standard for onboarding a new publisher. And within a couple of weeks we had our publishing agreement for the console and we were also licensed for Windows initiatives which are inclusive of everything from the mobile platform to Windows 8, and Smart Glass.
We are also licensed publisher for Sony PlayStation and we have a license agreement with General Mills (GIS) , which is a two-pronged license agreement. The first part is we are licensed to make sports-themed games that are branded by Wheaties, which is, of course, a world-renowned brand. The second component is to create virtual apparel and costumes for avatars based on General Mills’ breakfast cereal and food product Mascots. These are world renowned brands that include Frankenberry, Count Chocula, Lucky the Leprechaun from Lucky Charms, the Trix Rabbit, and many more. The virtual apparel and costumes for avatars end up being revenue generating marketing vehicles for the game to which they are attached, which in this case is a Wheaties branded sports game.
EQ: That makes perfect sense. You mentioned now you are doing a lot of work with Wheaties. Do you plan to capitalize via branded content like Wheaties or are you doing a lot of original material as well?
Chiodo: That’s a great question. Our whole product portfolio is really based on three tent poles, and let me define each one of those for you in turn. The first is licensed brands; of course we’ve talked about our relationship with General Mills and how this translates into a Wheaties branded sports game. I’ve been in the games industry for the better part of 23 years and in that time I’ve had the benefit of working with lots of great licensed brands, professional sports leagues, toy companies, Olympians, professional athletes, et cetera. Some of the brands with whom I’ve worked in the past have reached out to me personally and said, “We loved working with you on previous projects and now that you have a publishing company of your own we would love to have a relationship with your new company and see if we can work on some new titles together.” As I noted in the recent shareholder letter I issued at the end of November, we’re very close to wrapping up our agreement with one of these groups and I look forward to disclosing who that group is in the near-term. I’m really quite excited about it. Similar to what we talked about with the Wheaties scenario where Soul and Vibe will develop and publish avatar apparel and costumes as an extension of the Wheaties branded sports game, the same will hold true for this new licensed brand partner. Its a nice revenue generating marketing vehicle. So that’s tent pole number one.
Tent pole number two is internally generated intellectual property, or “IP.” The real value of a game company is based on what it owns and what it creates. A big part of Soul and Vibe’s focus is going to not only being working with licensed brands but building our own IP as well. Our intent is to start transforming these proprietary IPs into self sustaining franchises that will live on outside of the gaming space. There’s been some great success stories. Look at Rovio with Angry Birds. Look at King with Candy Crush. Some great ways to cross promote our titles include virtual apparel and costumes for avatars and companion apps. These things reinforce awareness for our brands and helps build each as a self-sustaining franchise.
Our third tent pole is what we call “pick-ups.” There are lots of independent software developers located all over the world that make games on their own accord and on their own budget. Sometimes these developers need financial assistance to help them finish development of a game. Sometimes they can’t release it because they either don’t have the marketing wherewithal to really promote it or they lack the appropriate publishing license for the desired platform. Because of this, these independent developers are on the lookout for publishers like Soul and Vibe with whom they can partner. We can license or acquire the game(s) for either a flat fee or a combination of a fee plus a back-end royalty for the developer. Pick-ups are great for us as a company because they give is an even distribution of revenue across the calendar year as the games fill the gaps between the licensed-brand and original IP titles we build “from scratch.” Pick-ups also give us a steady stream of content for both the gaming press and players to talk about, which reinforces our brand.
EQ: That’s interesting that you mentioned King and Rovio, two of the more successful in indie gaming. What is Soul’s edge over a lot of these emerging Indie game makers?
Chiodo: The combination of all three tent poles gives us a solid strategic advantage. We have a diverse product portfolio of games spread out across the year. Pick-ups are lower scope, and quicker to bring to market. We can make bigger bets on licensed-brand and original IP titles that we create from scratch. Licensed-brands drive traffic and, if our proprietary IPs resonate, we can potentially license out these IPs for markets outside of games. I think all this works to our advantage.
We’re very much a multi-platform and a cross-platform company. This means that instead of Soul and Vibe focusing its attention on one type of hardware platform we develop for multiple hardware platforms so our games are available on as many devices as possible. We have a big company initiative right now to make sure, wherever possible, that different hardware platform versions of our games can interconnect which creates a shared experience. Players can interact both socially and through good old-fashioned competitive or cooperative play. It’s a great gaming feature.
Along these lines, I’d like to draw your attention to a press release we issued on Jan. 27. We recently launched a Beta version of great new game called Timeless Gems on Facebook. Visit www.facebook.com/timelessgemsgame to check it out. In the game you relive your favorite stories in an innovative “match-3” puzzler that’s wrapped in a board game. Playing as Alice (Alice in Wonderland) and Dorothy (The Wonderful Wizard of Oz) you’ll meet a colorful cast of heroes and villains. Match gems, power up, connect and play with friends on Facebook. We are getting great response to the game from the Facebook community and they are helping us further polish the game. We’re very excited about Timeless Gems. Visit www.facebook.com/timelessgemsgame and click on the Play Now button.
EQ: Our readers like to stay up to date on the absolute cutting edge and that news certainly is that.
Chiodo: We’re really excited about Timeless Gems. Its a highly addictive match-3 game we anticipate will appeal to fans of Candy Crush and Bejeweled. Timeless Gems creates an innovative play experience by combining highly popular match-3 game play with board game elements. This combination sets up a compelling platform through which players can experience classic stories like Alice in Wonderland and The Wizard of Oz in a whole new way. There is nothing quite like it on the market right now and it really helps us stand out.
EQ: In addition to Timeless Gems, Are there any other goals or milestones that you expect to occur over the next 12 months that the investment community should be aware of?
Chiodo: Yes. We have a strategic relationship with a software development company in Mexico called Larva Game Studios. We issued a press release about our relationship in July of last year. We are currently working with them on two titles, one is called Last Day on Earth. (Abbreviated L.D.O.E.) It is a hybrid third-person shooter / tower-defense game. Larva is also working on an original Soul and Vibe IP called Grimwhiskers. Grimwhiskers is a pirate-themed game. We also have other titles in various stages of development that we’ll be shedding some additional light on in the coming weeks.
EQ: Your company seems to have a pretty diverse set of especially fantasy-based games which I noticed – like you mentioning Timeless Gems having kind of the Alice in Wonderland board game element, which I find to be really interesting.
Chiodo: Our product portfolio features a diverse mix of games that includes (but isn’t limited to) sports, fantasy, and sci-fi.
EQ: Could you tell us a little bit about your background and any other key members of the management at Soul and Vibe?
Chiodo: I’ve been in the games industry for the better part of 23 years. I started right out of high school. My first job was writing instruction manuals and back of the box copy for 8-bit NES and original Game Boy games. While I was in under-grad my career expanded and I suddenly found myself as a production manager! I was managing the full portfolio of games for a Nintendo licensee company called ElectroBrain. I learned that I really liked the games industry. I liked how dynamic it was. I liked how much growth potential there was for me personally. I finished college, attended graduate school, earned an MBA, and I stayed with the games industry.
Along the way, I worked with a small group of guys who started a great development company called SingleTrac. They received funding from Sony to create launch titles for the very first Sony PlayStation back in 1995. I worked with SingleTrac for several years and they were acquired by a large New York-based games publisher, GT Interactive.
I was recruited away from GT Interactive to work for Microsoft. I was fortunate to have been able to work on launch titles for the first Xbox. After several great years at Microsoft I was recruited away to work for a company in Minneapolis / Saint Paul called Destineer. Destineer had an interesting model. They were a game developer and publisher that created commercial games for consoles, PC, and Mac. Destineer was also a government contractor. We developed training tools for the likes of the United States Marine Corps and different lettered agencies within the United States Federal government. Those are known as “serious games.” While at Destineer I became their Director of Product Development and help build a publishing business that released over 100 titles in four years.
After approximately 20 years in the games industry I thought, “If I don’t do this for myself I probably never will. I owe it to myself to see what I can do as the head of my own company.” Soul and Vibe was born. One of the best things I have ever done.
I want to draw attention to members of our Strategic Advisory Board. The first person that joined our board was Jamie King. Jamie was one of three individuals who founded Rockstar Games which, of course, is well known for the Grand Theft Auto series has sold millions and millions of units. Jamie has a wealth of experience in a creative director role and in directly managing development studios.
We have a business development specialist named Michael Bolden. Michael is very well versed in running development studios and developing motion capture facilitates. He has a lot of great licensing contacts; he’s a huge benefit to the company.
Scott Balaban and Erik Stein are two former Hasbro toy designers. Scott is an industrial designer and Erik is an engineer. Scott and Erik have worked with some of the biggest brands like Star Wars, Lord of The Rings, Harry Potter, Disney, and Nickelodeon.
The full bios for each member of our Strategic Advisory Board can be found under the Management tab on our website www.soulandvibe.com.
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