Supercell's Best Letter in Decades
This is Ilkka Paananen's best letter in at least half a decade. I'm sure this went through three or four different PR committees, but he still comes across as authentic.
He doesn't pussyfoot around Squadbusters, unlike in all his previous posts. What went wrong? What are the lessons? They are clear and direct and actually reflect so much of what we've written about at @Deconstructor of Fun. There's real data too! And my god, who wouldn't kill for ~30% D7.
So much of his post reads like it's DIRECTLY lifted from comments on TWiG: new platforms and new audiences are opportunities to grow, and we've failed to do that in the industry, entering a period of stagflation. PMs' A/B testing of button colors on their way to innovation, or reskinning Royal Match, won't solve this. It's a function of bold new bets, and say what you will about Supercell, I'm glad that they've been able to accept more risk appetite. Yeah, Mo.co's probably a failure, and so was Squad Busters, but they tried something new, and learned new lessons, written in blood no less.
The challenge with Supercell is its inability to move on from bad bets. As they continue to scale as an organization, they become vampires sucking on resources and distracting the company. ¿Dónde estás NORTH AMERICA? Was the Supercell engine a success? And when does the Mo.co timeline end?
The bravest part of the letter and one that actually had real teeth is where Ilkka Paananen lays out what new game creation will take, specifically: profit-sharing, and tight constraints. "I've rarely seen great products emerge from teams with unlimited budgets and endless runways", he writes. I just wish he applied that to internal initiatives too, not just games.
Still, the missing piece is about how Ilkka will innovate on the Super "cell" itself. Initiatives like Sparks Labs or AI Labs feel like they're running away from the problem, trying to have innovation happen outside the Finnish HQ rather than dealing with the very messy problems of "corporate entrepreneurship." I poked at it for fun, but none of this letter felt like someone who's striving to become the world's least powerful CEO.
The financial results were impressive and should assuage some concerns that they were UA bursting Clash Royale. There's also an honest acknowledgment that Clash Royale is now on the decline again, and they need to find their next big beat. Looks like IPO is back on the menu boys?