Last week, Kuuhubb Inc.(TSXV: KUU.V) (OTC: BCDMF), a mobile game development and publishing company targeting the female audience with bespoke mobile experiences, announced the successful soft launch of its newest game, “Tiles & Tales.” The new mobile app is designed as a unique combination of two top-rated genres within the female gaming community; match-3 and visual novels. Like its other apps, the bespoke graphics and interactive properties make the game a potential Top Ten download in the female gaming market. If it does, it would be Kuuhubbs second chart-topping game.
About the launch, Jouni Keränen, CEO of Kuuhubb, stated, “Tiles and Tales is our flagship second-generation game and Kuuhubb’s key focus in calendar year 2020. I am extremely proud of our talented development team for all the dedication, hard work and love they have poured into the game. I am confident that this is the beginning of a new long-term franchise and a important growth driver for Kuuhubb in the future”. His optimism is well-founded.
Kuuhubb is continuing to target an underserved market where female gaming is said to account for roughly 46% of the gaming population. By player numbers, some estimates place the addressable market at more than one billion active female gamers. It’s a number that keeps Kuuhubb high on the list of companies to watch during 2020.
Combining Match-3 With Visual Novels, A Win-Win
Kuuhubb is aggressively targeting opportunities in the match-3 app space. These challenging apps, also referred to as tile-matching games, offer up a multi-billion-dollar market opportunity and are the most popular genre with female gamers by a significant margin. Reports show that some titles are generating USD 25-50M in monthly revenue, leveraging a niche market where HubSpot suggests that 69% of match-3 players are women. Global estimates for the expanding match-3 market is expected to generate over USD 5B annually. Supporting that projection is a stat from Sensor Tower that notes that of 20 games that have lifetime revenues exceeding USD 1B, five are match-3’s (Disney Tsum Tsum, Candy Crush Saga, Puzzle & Dragons, Gardenscapes and Homescapes).
The industry is also benefiting from consolidation within the match-3 segment, with Playtika and Zynga acquiring the Helsinki-based Seriously Digital Entertainment Oy and Small Giant Games Oy for approximately USD 275M and USD 650M, respectively. Kuuhubb may also be a player in the consolidation game based on its ability to bring to market compelling games and apps. That success is shown by, Recolor, its app that earned a Top 10 position of most popular downloads.
According to Kuuhubb, Tiles & Tales is the first game in the market to merge match-3 games and interactive visual novels. The company developed and targeted this combination game market, which has traditionally been considered separate. However, after research conducted for Kuuhubb showed considerable overlap among players, the decision was made to design a game specifically catering to both groups that inherently delivers cross-over appeal. If all goes according to plan, Tiles and Tales has the potential to enhance the respective audience sizes and enables fans of one type of gaming to broaden their horizons by introducing them to another popular genre.
Video Link: https://youtu.be/-ySRBo4Q35I
Uniquely Positioned and Designed
The newest addition to the Kuuhubb library of products is considered by some as a genre mash-up by introducing new game mechanics that set it apart from other match-3 games. Specifically, throwing pieces to make matches, rather than merely tapping them, shakes up the traditional gameplay in a way that will get even the most experienced puzzle enthusiasts excited.
Kuuhubb’s, Tiles & Tales, is getting shown as the latest example of Finland’s game industry innovation and is the first game developed entirely in Kuuhubb’s Helsinki Game Studio using an in-house developed match-3 engine. In addition to the soft launch of Tiles and Tales, the company is focused on the expansion and diversification of its product portfolio through the creation of its second-generation games. It’s also expected that the Kuuhubb development engine efficiencies will significantly reduce the expenses and time required to bring new titles to the market.
Kuuhubb Success Is Rearing Its Presence
Kuuhubb is on the right track for growth and has demonstrated expertise to target substantial market opportunities that can deliver long-term rewards. Kuuhubb, who characterizes itself as a lifestyle game and app company, is paving its path to success through a strategic process – to develop, create, and publish a bespoke mobile lifestyle for women.
The company roots go back toward 2014 when Kuuhubb began its mission to create inviting content and visually stunning gaming and app graphics. The focus aimed to convert lifestyle trends into unforgettable gaming experiences. And, there is something unique about the Kuuhubb business focus. Instead of developing content for a broad range of demographics, Kuuhubb is instead creating content designed to attract the attention of the estimated one billion female gamers worldwide. And, for Kuuhubb, having the “know-how” to benefit from this multi-billion dollar market opportunity puts them on the path for long-term, sustainable growth on a global stage.
The proof of that success is demonstrated by its growing library of games and apps, with Recolor, one of its most popular female-focused coloring apps, already earning a Top 10 position on the U.S. App Store charts. And, there is far more to like about Kuuhubb than only its unique, bespoke style gaming content.
Targeting A Female eGaming Market Opportunity
Although the billion-person female gaming market is a global estimation, a more targeted survey shows that women now make up roughly 46% of the mobile gaming and app market. That makes them a substantial contributor to the expected $140 billion in total video game sales expected by 2021. And, by creating innovative and inviting content, Kuuhubb may have found the formula that can allow them to earn a sizable share of that enormous dollar market over the next few years.
The Kuuhubb user base is treated to bespoke style art and visuals, each with aesthetically compelling images and extremely entertaining games like My Hospital, Dancing Diaries, and Recolor By Numbers. These games stand out as examples of the company’s expertise in developing creative, vibrant content that combines artistic creation with fun and challenging themes. In fact, its current 70 people international team of developers, writers, and back-office staff are each contributing toward a common goal of making Kuuhubb a leading provider of gaming content to the female demographic. To get there, Kuuhubb is taking advantage of accretive acquisition opportunities combined with responsible capital management.
2017 Served As The Start Of Impressive Growth
Although Kuuhubb made its start in Finland in 2014 as an online gaming consultant company, the growth spurt came in 2017 after the company made a series of well-placed decisions and deals.
First, Kuuhubb secured a public listing in Canada, where it currently trades on the TSXV market. After an equity raise of CA$6 million, the company then searched for assets that would be accretive to the growth strategy. The first move, which turned out to be an excellent decision, was the acquisition of Recolor, a coloring app that is now a Top 10 app on the charts. Also, in 2017, the company raised an additional CA$17 million in capital to broaden its operations and gaming pipeline.
This allowed Kuuhubb to extend its reach into the Indian market, where it established a strategic partnership with India’s largest talent management group. The growth continued into additional markets in 2017 when the company created its Japan operations division. These new geographic locations extended the competitive landscape for Kuuhubb that helped seal the deal on a second asset purchase of My Hospital, another highly-rated game that encourages users to build, farm, and heal. Kuuhubb owns the global rights for the app. The difference that the Kuuhubb platform brings to its vast user base is that they inherently inspire its users to do three things – relax, express, and entertain.
And, Kuuhubb’s mission to become a top player in the space of women’s mobile gaming and casual esports continued into 2018.
Brand Deals In 2018 Strengthen Kuuhubb For More Growth
While 2017 set the table, 2018 brought significant growth opportunities through the extension of co-marketing deals. Currently, Kuuhubb is working with major global brands, including Kellogg’s, Lionsgate, Ben & Jerry’s, and Mattel, to bring to market exciting games that combine partner’s products with innovative gaming features. Examples of recent campaigns and partnerships included coloring apps with Barbie, Orange & Black, Ben & Jerry’s, and My Little Pony.
The company also made additional strategic moves in that year by acquiring the tech and development assets from Valiance Group that fortified its development resources. They also acquired the global rights to Dancing Diaries, a Match-3 story game that combines popular Match-3 core gameplay with a dancing meta-game. But, to truly appreciate how Kuuhubb differentiates itself from the status quo, readers of this article should click on this link to see how art, imagination, and technology can come together to make high-quality, visually- appealing, games, and apps.
While the 2018 additions to its gaming library and tech assets were significant, Kuuhubb also closed on another financing deal to facilitate additional growth. This time, they attracted a growth financing deal for €2 million. Also showing that they can attract mainstream funding, in 2019, Kuuhubb closed on a €1 million long-term low-interest government loan instrument.
Recent Earnings Show Trend Higher
During the first week of March, the company put out its fiscal Q2 results that highlighted revenues that beat analyst estimates by $0.07 million. Three and six-month revenue numbers came in at $1.97 million and $4.26 million, respectively. Revenues came primarily through its top two apps, Recolor, and My Hospital. The company also beefed up its balance sheet with additional funding after the quarter ending.
Moreover, during February of 2020, Recolor Oy, a wholly-owned subsidiary of Kuuhubb, entered into a sale and purchase agreement with Codecacao d.o.o. Under that agreement, Kuuhubb will acquire 100% of the issued and outstanding shares of Codecacao in consideration of one-million common shares from Kuuhubb payable over two years. The deal brings Kuuhubb a team of apps and game lovers that develop globally recognized products.
A broader perspective and understanding of the recent quarterly report shows that Kuuhubb is continuing to build a leading lifestyle game portfolio and is advancing its position as an industry innovator, targeting the female demographic. At the same time, the company made good on its promise to launch its newest product into the popular match-3 (tile-matching) gaming space with the development and soft launch of Tiles & Tales.
Kuuhubb In 2020, Targeting A Huge Female Gaming Market
The remainder of 2020 is setting up to be a breakout year for Kuuhubb. With plans in place to bring new games to market, acquire new assets, and add liquidity to the balance sheet, the company can become well-positioned to increase growth momentum as the year unfolds.
Targeting a more than one-billion person market, few will argue against the company being well-positioned to attract interest from a substantial market segment. Further, by executing on its commitment to delivering products and revenues from female gamers in an under-served product development market, the company can provide substantial long-term rewards, especially as the emergence of the gaming industry’s latest phenomenon, esports, continues to gain user traction.
Differentiating themselves from a crowded, competitive landscape and filling a void in a multi-billion dollar market can undoubtedly provide a competitive advantage to Kuuhubb. Moreover, as new opportunities continue to develop in the casual, mobile esports game niche, Kuuhubb can seize upon new market opportunities that combine immensely popular casual and multiplayer elimination genres to create a unique portfolio of games for the female market.
Notably, three things play in favor of long-term growth for Kuuhubb. First, the company is targeting a market that is increasing in size, despite it already being an estimated one-billion person opportunity. Second, the company is bringing to market innovative, challenging, and visually appealing games that cater to the demands of the female gaming market. And, third, the company is well-managed and has a team of business and design professionals that have proven their ability to build multi-generational game concepts.
Combining it all, Kuuhubb may be in the best operating position in its history to deliver breakout results that can build shareholder value. The launch of Tiles and Tales is only a first step toward achieving that goal. And, if the company continues to execute its ambitious growth plan for 2020, staying focused on opportunities beyond just playing its games may be a wise choice.
(To enjoy the recent launch of Tiles and Tales, please copy and paste these URL’s into your browser: https://linktr.ee/tilesandtales, https://www.facebook.com/tilesntales, https://www.instagram.com/tilesandtales/)
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