Non-fungible Gaming, with Tobias Batton of Ex Populus


Non-fungible Gaming, with Tobias Batton of Ex Populus

Tobias Batton is a serial entrepreneur. In this episode of The Metaverse Podcast, he shares his entrepreneurship journey with host Jamie Burke. Tobias’ latest venture is Ex Populus, a Web3 version of Steam, the gaming platform. He expands on their differences and what’s coming up next on their roadmap.

Posted by Non-fungible Gaming, with Tobias Batton of Ex Populus - February 2022


Non-fungible Gaming, with Tobias Batton of Ex Populus Outlier Ventures

  • A seasoned entrepreneur. Founded 3 companies and sold 2 of them
  • Was originally born and raised in a small town in Michigan
  • Was 18 years old at the peak of the dotcom boom
  • After college, he went to work for AT&T, the largest telco in the US. Was negotiating data network contracts for medium sized businesses
  • Started his companies after that

Liberated Films

  • Came across Atom Films, a company making really cool short content and animated content
  • He and his friend started a company called Liberated Films, which was inspired by Atom Films
  • Attended film festivals to pitch to filmmakers about his platform
  • Licensed thousands of films from these festivals and their website became very popular
  • Sold his company to REN Media Group

Clan Wars

Non-fungible Gaming, with Tobias Batton of Ex Populus Outlier Ventures

  • Created an app called iGirl, which was a virtual girlfriend, as a learning experience. Launched it on the Apple App Store and it became a huge success
  • In 2007/2008, they started working on a social game called Clan Wars. It was a huge success, with millions of people playing it within the first couple of months
  • Clan Wars ended up being acquired by Mindspark
  • Was subsequently approached by IGN to provide coaching to game devs and artists on how to start a business

A lot of this comes down to timing, like you have to time your startups correctly. With Liberated Films, we have the timing correct. It was a little bit before YouTube came out. And then of course with Clan Wars, it was right around the same time as Farmville and I didn’t even know that my timing was gonna be right on those.

– Tobias Batton

  • Got to work with the following individuals:
    • Notch — creator of Minecraft
    • Edmund McMillen — creator of Super Meat Boy and The Binding of Isaac
    • Alex Austin — creator of Subnautica
    • Justin Woodward — owns the Media Indie Exchange

Emerge Digital Group

  • In 2012/2013, he was invited by another friend to help him with his business called Emerge Digital Group, an advertising company
  • A revolution was happening in the advertising ecosystem at that time. There was real-time bidding (RTB) and advertising was starting to look a lot more like exchanges on Wall Street, where you can buy and sell your ad inventory in real time
  • Google created the OpenRTB specification. It can be divided into 2 sides:
    • Demand Side Platform (DSP)
    • Supply Side Platform (SSP)
  • Google connects the DSPs to the SSPs and this is where the bidding would take place
  • Emerge Digital Group was an SSP. His role was to manage the mobile arm of the business

Signal Zero

Non-fungible Gaming, with Tobias Batton of Ex Populus Outlier Ventures

  • After 1 year, he left to build a company called Signal Zero. They had a product called TokenWall, which is very similar to a play-to-earn platform
  • Ad networks would come to them to get their app to the top of the charts
  • His company would deliver hundred thousands of installs by taking a percentage of the client budget and paying it out to users in the form of points that they could exchange for Amazon gift cards or Steam gift cards
  • Started incorporating Bitcoin, ETH, and other cryptocurrencies where people could redeem their points for
  • The platform took off and they were doing millions of dollars a month in revenue
  • He could not hire fast enough to meet the engineering demand. Had to go to Pivotal Labs to get hires
  • Bot farms arrived and they had to incorporate third-party cybersecurity software that could detect bot activity
  • Due to data privacy laws, they realized that they are not allowed to share data with the cybersecurity platforms
  • Ended up investing in their own engineering team to build a loss prevention software that is able to authenticate whether a device is real
  • Was leveraging something called Shannon entropy:
    • Don’t think the basic building blocks of existence is atoms or subatomic particles. Thinks that it is pure information, almost like ones and zeros
    • An easy example to illustrate it is 10 TVs that have the same model numbers, manufacturer, made of same parts, etc.
    • However, the signature pattern that each TV sends to a satellite would still be different on a molecular level
    • The entropy that is detected creates a fingerprint that uniquely identifies those 10 TVs as separate TVs even though their serial numbers, etc. may all be the same

Why Did He Enter Game Publishing?

  • Everyone made lots of money with Signal Zero
  • The demand for advertising went down over time
  • Closed the company and did a bit of consulting for the next 1.5 years
  • His time at IGN was the most fun and engaging experience he had
  • Started Ex Populus in Jan 2021. The goal was to both work on some projects they had internally as well as other folks that needed help as an indie video game publishing company
  • Clement Wong, his co-founder, introduced him to NFTs and NBA Top Shot
  • His wife also suggested that he should pay attention to the Metaverse
  • 15 years ago, there were no microtransactions in video games. Today, games are free to play and gaming companies make money with battle passes and in-game purchases

I keep hearing the same thing from my wife, who at that point, worked at Oculus. Like she was talking about, like, hey, the Metaverse is going to be a really big deal. You should pay attention to it.

– Tobias Batton

  • With Web3, there is a different mental model. Gamers are part of the ecosystem. When gamers make money, the developers make money. Hence, they rise and fall together
  • Realized that Web3 gaming is the next wave of gaming. Started Ex Populus to jump on this trend

Future Proofing

  • Bill Gates wrote an essay titled Content is King in 1996
  • In 1996, the internet was new. This is similar to Web3 today
  • At the end of the day, what people wanted is great content — news, games, movies, etc.
  • Over the long term, high quality content will win out
  • His personal experience is that when a new industry/market has emerged, one can experience huge growth by entering that market

And what it means is that this new industry, or new market has emerged, and there’s no one in it, or there’s very few people in it. It’s almost like a vacuum. And if you enter that space early, you get really big, really fast.

– Tobias Batton

  • He is seeing professional game devs moving from Web2 to Web3. As more game devs move to Web3, the quality bar of what it takes to succeed in Web3 gradually increases over time
  • Their thesis is to work with the best creators they can find. They have a few of these creators on their team:
    • Mark Harris — one of the top contributors to animation at Pixar and has some VR experiences that have won Emmys
  • Having acquisition talks with a few other game companies right now

Ex Populus As A Web3 Steam

  • It’s a good example to describe Ex Populus as a Web3 Steam
  • Valve is the company behind Steam. They make games, acquire others, and hosts a marketplace for games
  • Similarly, Ex Populus has a marketplace where they sell games they work with
  • Thinks that Steam is avoiding Web3 for the moment because of their Steam Community Market — a place where players can buy/sell their in-game items
  • Steam takes 10% of every transaction on the Steam Community Market
  • The limitation is that gamers are unable to take their in-game items out of the Steam ecosystem
  • If Steam opens up its doors to Web3, they are going to lose market share and revenue. Hence, their defensive posture

What’s Coming Up Next For Ex Populus?

  • Will be releasing a couple of games this year
  • Are in acquisition talks for some games. Once those teams, games, and assets are acquired, they will make them available as soon as possible
  • Thinks that there is so much possibilities with NFTs that traditional gamers have not realized yet
  • What’s interesting to him is the cross-promotional capabilities of games that include NFTs (e.g. if you own an Axie, you get early access to our game)

If you’re a game developer in the space, and you’re listening to this, I think the initial thought that you have when you’re making a game is how can other people use my NFT or my in-game items? I think the better question to ask is how can you use other people’s right? Because the more you do to start to bring utility in from these other communities, the more likely it is they’re going to come check it out and say, Oh, I heard this game is giving me something special for owning this thing from this other community.

– Tobias Batton

Non-fungible Gaming, with Tobias Batton of Ex Populus Outlier Ventures

This podcast summary was prepared by The Reading Ape in collaboration with Outlier Ventures. The Reading Ape is a humble servant of the written word.

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