Hendrik Klindworth CEO InnoGames about challenges, motivations and next steps
Briefly introduce yourself!
My name is Hendrik Klindworth and I am the Chief Executive Officer of InnoGames. I founded the company together with my brother Eike and our good friend Michael Zillmer. I started programming at the age of 14 and turned this passion into a profession. I’m very happy that I can work on something every day that our players and I really enjoy.
Briefly introduce InnoGames!
InnoGames is Germany’s leading developer and publisher of online and mobile games. We are best known for games like “Forge of Empires”, “Elvenar”, and “Tribal Wars”. All our games are developed by our highly talented team made up of over 400 employees from over 30 nations. We all share the goal of creating unique games that provide years of fun for players from around the world.
How did you come together as a founding team?
We’ve known each other since kindergarten. Playing video games has always been a great passion of the three of us. One day in 2003 we decided to develop our own browser game for us and our friends. We wanted to create a game that we would really enjoy playing ourselves. And that was how “Tribal Wars” was born. It started as a hobby project.
At first, only a few of our friends played the browser game, but after we removed the password protection, the number quickly grew into the thousands. At that time our costs were 20 Euro for the server, but we decided to earn some money through advertising. On the first day we had advertising revenues of 10 Euros, I remember that quite well.
Why did you decide to start a business?
As the number of players grew, we realized that we had to make a decision: either to fully focus on the game and found a company or to continue going to university or respectively, as in Michael’s case, continue working in IT. Game operations, including moderation and support, could no longer be managed as a side activity. Up until that point, we were doing all these things ourselves. This happened in 2005. In 2006 we rented an office, developed a business plan, and finally founded InnoGames in 2007.
What is the vision behind InnoGames?
We want to develop first-class games for our players – with high-quality virtual worlds that bring together millions of people around the world. Anytime and anywhere.
What were the biggest challenges you faced when founding InnoGames?
At the beginning it was difficult to estimate how big the potential for online games was. Since we founded our company in a small city, we lacked a network that would provide us with good advice and a regular exchange with other founders. Also, we had some concerns about giving up our studies altogether and fully concentrating on game development. However, these concerns faded away with the growing success of InnoGames. We quickly progressed and professionalized. This constant and ongoing development is still a central feature of InnoGames and is one of the things that makes us what we are today.
Were there moments when you thought that you could not go on?
No. We had the right idea at the right time, and thanks to the high quality and strategic depth of our games, we were able to establish ourselves in the market quickly. We also took the right strategic decisions when they were needed. For example, by moving from Stade to Hamburg, bringing an investor on board at the right time, finding the right employees, further professionalizing our business, and continuously expanding our portfolio. The change of our focus from browsers to mobile platforms was also important for us; mobile is currently the main growth driver.
What motivated you not to give up?
To be honest, it is still the same motivation that back then helped us to develop “Tribal Wars”: our strong passion for games that give people all over the world hours and hours of fun and provides them with a platform where they can play together or against each other – and prove their strategic skills.
How difficult was it to find the right employees? Is there such a thing as the perfect employee? What tips do you have for young founders when selecting and hiring employees?
Recruiting top talent is not always easy. Positions that are specifically related to games are simply difficult to fill. In fact, we are almost always looking for staff in order to continue to grow sustainably and to implement our ambitious plans.
As far as the perfect employee is concerned, one thing is certainly clear to us: everyone who works with us must have an affinity and ideally also a passion for games. Furthermore, we are proud to have employees at InnoGames who, in addition to their professional qualifications, share a number of characteristics that are anchored in our company culture – such as a focus on results, a sense of fairness, the ability to accept feedback, or the willingness to continually improve. If you are starting a company, you should definitely look for employees with these qualities.
How difficult was it to stand out from the competition? Where is your USP?
There are many other companies that develop high-quality and exciting games, both in Germany and worldwide. We rely on great teams and a high quality standard, especially in the area of the ongoing content expansion of our games, the so-called Live Operations. We are able to offer players all over the world, both on their PC and on mobile devices, high-quality entertainment and gaming fun for years. Our first game, “Tribal Wars”, is being continuously developed even after more than 17 years and enjoys a strong, active community and growing revenues.
What challenges did you face during the development of the games? In terms of age and legal issues?
The biggest challenge, as mentioned, was to find qualified employees. We have high expectations for our games. This means that all teams have to do a first-class job. Without appropriate marketing for example, the best game ideas would not be successful in the long term. We are able to operate games with lasting success over many years like hardly any other company. We achieve this primarily through a strong combination of outstanding live operations and strong analysis and marketing departments. The legal requirements can sometimes be somewhat complicated and challenging, but for us they are not a problem.
Who is the target group of InnoGames?
Everyone who likes video games. Besides the titles that are still in development, we currently have seven active games in the strategy and simulation genres, which are played by people of different age groups. More competitive games like “Tribal Wars” are preferred by slightly younger players, while other titles tend to be played by people that are a bit older. The average player of our titles is around mid-30s.
How has InnoGames developed so far? Are you satisfied with its development?
Absolutely! The key figures that we recently announced for 2019 show: we have been growing year by year since our founding in 2007 and have been profitable from day one.
We are particularly proud of the continued success and longevity of our games. In particular, “Tribal Wars”, our very first game, posted a new record year in 2019, achieving a ten percent increase over the previous year.
Beyond that, we are also very proud of what has come out of our original game idea back from 2003 so far. As mentioned, today we are Germany’s largest and most successful studio with more than 400 employees from over 30 nations. We certainly didn’t expect this in 2003.
How do you think will the gaming market develop?
We are confident that the gaming market will continue to grow in the coming years. Today, 34.4 million people in Germany play video games. That is almost every second German. Games played on smartphones will especially continue to experience strong growth. Smartphones are now the most popular gaming platform in Germany, with 18.6 million users.
We are also seeing this trend internationally. At the end of last year, the global gaming market was estimated at 152 billion dollars, an increase of 9.6 percent over the previous year. Smartphone games accounted for 45 percent thereof and there is no end in sight to this growth. Of course, this situation also means that more and more developers and publishers are pushing into this market and that the competitive pressure keeps increasing.
What are the differences between the gaming sector in Germany and the international market?
We develop our games for the international market and for us there are no fundamental differences between Germany and, for example, other European countries.
However, it is worth noting that especially in Germany, the games that are mostly played are those that were developed in other countries. Even though Germany is a very important market for the whole industry, the revenue share of games developed in this country was just 4.3 percent in 2019. We believe that this is primarily due to the fact that countries like Canada or the UK have had different conditions for game development for years. For example, in the form of subsidy models. As a German employer, we are therefore very pleased about the games subsidies that have been promised until 2023. We hope that words will soon be followed by deeds and that the industry will benefit from the funds. This is really important for the competitiveness of the entire location and the further growth of the industry.
Where do you see InnoGames in five years?
We want to continue to grow sustainably. To achieve this, we follow the same strategy that any good player of our games would: instead of pursuing many goals at once, we focus and secure one area after another. This allows us to expand our market presence step by step and in a sustainable manner.
Where do you see yourself in five years?
Here, in Hamburg. It’s a privilege to work every day on something you love, and I hope I can do so for many more years to come.
To conclude: Which tips would you give to future founders?
From my experience, I would advise every founder not to fall into the trap of wanting to grow too fast and too aggressively. It is better to go step by step, with diligence, focus, and above all passion for what you do.
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Thank you Hendrik Klindworth for the Interview
Statements of the author and the interviewee do not necessarily represent the editors and the publisher opinion again.