Angry Birds Set To Take Flight Publicly

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What's going on?

In a bid to spread its wings, Rovio Entertainment, the maker of the popular Angry Birds game, said on Tuesday that it is planning to become a publicly traded company soon (i.e. complete an IPO)…

What does this mean?

The game Angry Birds, one of the first massively popular smartphone-based games, was initially released in 2009. By 2014, however, its growth had stagnated and mobile gamers had largely moved from paid games like Angry Birds on to freemium games which are free to play but involve in-app purchases. Its founding CEO resigned in 2014 after profits fell sharply and the company was forced to lay off workers. However, Rovio turned to film to help turn itself around The Angry Birds Movie last year was a big success.

One of Rovios aims is to use the money raised in its planned IPO to develop new games, thereby developing new growth channels beyond Angry Birds.

Why should I care?

The bigger picture: The power of a brand can be a big deal.

The success of Angry Birds was such that virtually everyone, whether they played the game or not, knew what it was. So, when it fell behind the gaming curve it could pivot quite easily to entertainment, effectively cashing in on the well-known angry red bird. The company hopes to continue to profit from films: a sequel to The Angry Birds Movie is planned for 2019.

For markets: Rovio, eventually, will have to move beyond the Angry Birds franchise.

While Angry Birds is well known, its unlikely to be like James Bond in the longevity of its appeal. Eventually, after however many movies and t-shirts, the profits from the Angry Birds franchise will diminish. Although generating another hit anywhere near as big as Angry Birds is easier said than done.

Originally posted as part of the Finimize daily email.

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