Founders of iion - Sanjaya, Wout, and Giuseppe
We are thrilled to share our lead investment in the Seed round of iion, alongside Archangel and PixCapital.
iion is developing the leading adtech platform for the gaming industry globally, enabling brands and agencies to effectively target and launch advertising campaigns across video games.
Founders Sanjaya Molligoda, Wout Van Damme, and Giuseppe Martoriello have spent decades in the adtech industry working across all parts of the digital advertising business. They bring deep expertise to an underserved yet potentially massive segment of advertising: gaming. They are already working with some of the biggest publishers and advertisers globally as they begin to scale the platform deeper into Europe, the US, and China.
Opportunity
Approximately 3.2 billion people globally (~40% of the world's population) are categorised as gamers. The majority of them play online with ~1.3 billion using smartphones to play. To give some context to these figures, gaming includes everything from daily Sudoku on your mobile to Call of Duty on your PlayStation.
Time spent gaming, and the number of gamers worldwide is on the rise. On average, individuals globally spend ~8.5 hours per week playing games. Additionally, 11.4% of individuals globally spend more than 20 hours per week playing games.
Problem
Given the large and rapidly growing audience - brands, advertisers, and agencies see the space as an exciting opportunity to gain targeted access to an engaged cohort of the population. However, accessing high-quality advertising inventory and accurately measuring ROI in the gaming space has historically been challenging. Existing tools have been fragmented and difficult to navigate. As a result, despite users spending an equivalent amount of time gaming as they do using social media platforms or watching TV, there has been materially lower advertising spend penetration in gaming with less than ~5% of US advertising dollars being spent in this sector.
Solution
To solve this problem, iion’s seamless end-to-end platform provides a solution to unblock this bottleneck, operating effectively as a technology marketplace serving both sides of the advertising market being the supply side (game publishers) and demand side (brands and agencies).
On the supply side, iion connects game publishers and video game adjacent businesses (such as blogs and streams) that provide advertising space (or “inventory”) in, around, and outside of their games. On the demand side, iion serves brands and agencies that want to reach targeted audiences and access ad inventory in video games.
Why We Invested:
Team with deep vertical experience and proven early execution
- The founders - Sanjaya, Wout, and Giuseppe have worked in the digital advertising industry since the early days of the internet and programmatic advertising.
- Sanjaya & Wout founded an advertising trading agency that provided tech solutions and services in the digital marketing ecosystem. They grew the agency and tech platform to 50+ staff and were acquired by an ASX-listed company at the time in 2015. Their third co-founder, Giuseppe was a Media Trading Director at the acquiring company and met Sanjaya and Wout whilst working together post-acquisition.
- All three co-founders decided to return to the market as founders with a focus on gaming, bringing with them deep experience in programmatic, marketplace dynamics, supply and demand side understanding, and a playbook for use in an under supplied sector. Thus becoming the cofounders of iion in 2019.
- Since we first met the team, over the past year, we have had the opportunity to watch them continue to execute and deliver a market-leading product to their global customer base.
Major under-penetrated market ready for disruption
- Globally, there are over 3 billion gamers who spend as much time online as social media and TV users per day. However, ad spend in the gaming category significantly lags behind, accounting for less than ~5% of US ad spend. Advertisers have traditionally allocated a smaller portion of their budgets to gaming compared to social and TV, despite evidence of its effectiveness in reaching the engaged gaming audience.
- This discrepancy can be attributed to the lack of solutions that allow agencies to build high-quality and customised ad campaigns, target audiences, and measure campaign success; all requisites for an agency to funnel ad spend in the category. On the supply side, advertisers also haven’t had access to a large selection of ad inventory through a single platform. Many existing solutions are fragmented and focus either on the demand side (brands/advertisers) or the supply side (game publishers). We believe that iion has a global opportunity to address this issue by providing an end-to-end platform solution to become the market-leading technology platform for buying and selling of advertising inventory in gaming.
Online & mobile gaming tailwinds
- There are currently over 3b gamers worldwide, with industry revenues projected to hit US$180b this year. Revenues from advertising in gaming are projected to double to US$100b by 2025, according to PWC.
- The mobile gaming market accounts for >50% of gaming revenues according to BCG, and mobile gamers spend 2x as much time per week gaming than PC/console gamers.
- Tailwinds continue to build behind the online and mobile gaming space, particularly in new and emerging markets. In particular, the deployment of 5G across Asia is making the gaming experience more responsive and enjoyable, naturally growing the number of gamers and time spent gaming. It is projected by 2027, global data traffic per smartphone will be highest in South East Asia/Oceania.
- Part of the reason for this is the advent of cloud gaming, allowing for games to be hosted in the cloud and streamed to gamers at a higher quality than if downloaded direct to devices.
Given the incredibly experienced team and industry tailwinds, we are excited to be partnering with the iion team and look forward to what’s next for the company.