Former Square Enix of America CEO reflects on betting on new IP

23.04.2024 - 13:47 / gamesindustry.biz / Square Enix / Matthew Karch

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In a hits-driven industry such as video games, investing in new and emerging IP is often considered a financial risk. As budgets rise, so do expectations. While new games like Helldivers 2 and Palworld find fame and success, Immortals of Avenum struggled to the point where maker Ascendant Studios reportedly furloughed most of its staff.

Acquiring an existing franchise’s legacy doesn’t always work either — just look at Embracer’s restructuring efforts. Saber Interactive CEO Matthew Karch points to an "opportunity to make great entertainment at a price that isn't going to kill somebody's bank account" with Warhammer 40,000: Space Marine 2 dropping later this year.

To understand what gaming as a whole is currently experiencing, we sought out an expert who has worked on both established IP and new titles.

We sat down with Mike Fischer, the former CEO of Square Enix of America, to talk about betting on experimental IP and his pivot to working as a professor in Interactive Media at USC. While mass market appeal may be important, no genre is all-encompassing and there's still money to be made in gaming's many niches. That's where Mike's role of broadcasting sound business fundamentals comes in.

As a CEO of the American arm of one of Japan's most celebrated publishers, it didn't take long for Mike Fischer to find that "the biggest cultural differences [were] between the development culture and the publishing marketing culture." From his experience in the industry, most developers weren't business-oriented.

"[A] joke we have is that when a game is successful, it's because it's a great game," he said. "And when a game is a failure, it's because of bad marketing. What I've found is it's most important to understand what the creators' vision is for their game but also what the real market opportunity is. Find a way so that those can work together in harmony and that the game can achieve its full creative potential."

"Subscription services are a wonderful opportunity for games to be discovered that are not in decades-long franchises or multi-million dollar media campaigns"

This intersection between market opportunity and developer vision is evident in 2024's first knockout hit Palworld, reaching over 25 million players in a month. While the game plays hard and loose with its inspirations and familiar mechanics, there's no denying it was tailored for a mix of popular niches. Building something new at that scale at an established studio, especially when existing franchises are doing well, is no small ask. While Fischer and his team were keen on expanding their purview with games built in the US, they encountered friction within the company.

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