In the startup world, a “sure thing” is fantasy.
Even companies with VC backing and celebrity spokespeople, though statistically not as likely to fail, have done just that. And while a two-person startup working in a saturated market out of a Hollywood apartment may very well one day sell for half a billion dollars, the odds are far from in its favor.
Launched in 2012, LA-based Nix Hydra got off to a rocky start.
Today, the mobile game developer is not only alive and kicking, but has also solidified itself as one of the industry’s hottest studios. When two Yale alumni were frustrated with the lack of games directed at a female audience, they took on the mission themselves.
“As roommates, we would hang out and try to find new games to play, but we didn’t really find many that appealed to us,” said co-founder Lina Chen. “At the same time, I got really curious about the world of tech and digital things and started going to a lot of tech and digital conferences, and we realized that most of the people attending these conferences, and working in tech, were mostly male. That’s when we started to understand that no one in the industry was looking out for younger women.”
Neither Chen nor co-founder Naomi Ladizinsky had a background in coding, and when combined with their lack of experience in game development, this made the first few months of Nix Hydra a little hectic.
"We had no experience or contacts in the industry; we didn’t know what we were getting into in terms of how hard the process can be," said Chen. "Think about it: without any experience, contacts or experience in the game industry, we learned how to code and went out and met as many people as possible."
While industry contacts can be cultivated over time, Chen and Ladizinsky's lack of experience with game development was something that attending a few mixers couldn't fix. Over the course of a few months, the duo used a combination of W3 schools and YouTube videos to get to the point where they were comfortable writing code.
However, the team's focus on creating video games with women in mind didn't necessary appeal to potential angel investors, many of whom are traditionally men.
"Since most angel investors are male, it’s harder to raise money from those people if you’re trying to serve a demographic that they’re not in touch with," said Chen. "It’s not like it’s anyone’s fault. If you happen to grow up as a man, you may not be as interested in making products for young women, and the vice versa is true."
As if things weren't tense enough, Chen, originally from South Africa, started experiencing visa issues, to the point where she had to spend time abroad.
“Everything hit rock bottom when we were both really low on savings, we had no warm leads for investors, and I was told that the next time I entered the country, I could only stay for seven days,” said Chen. “So I went home to South Africa to live with my parents, which was terrible, and less than a month went by before I realized that I need to go somewhere where there was a tech industry and there was money; it just couldn't be the US.”
Because Chen spoke Mandarin fluently, she settled on Shanghai, where, after a few months of networking with individuals vaguely involved with tech, she met Tuolin Chen (no relation), co-founder of a large Chinese game developer called G-Bits.
“He understood the underserved market and he liked the product that we wanted to make,” said Chen.
With an initial angel investor in place, Chen approached Brandon Beck, founder of Culver City-based Riot Games. Beck, whom Chen describes as "a personal mentor," also saw the promise in Chen and Ladizinsky's vision and contributed to the angel round. For Nix Hydra, the angel round of investing gave them a sense of legitimacy. But for Chen, the financial backing meant that their hard work was finally paying off.
"When the two of them said yes, it sent a signal of credibility to everyone else, and that’s how we got the first round," said Chen.
The studio released its first game, Egg Baby, in March 2013. In just a year, the game was downloaded eight million times. The company used the strong numbers to secure a $5 million Series A funding not long afterward.
Since then, the company has moved to an office in Downtown LA, and now boasts a staff of 34 — 60 percent of whom are women. Their recent release, Egg!, has been downloaded over two million times since its launch in early June.
“We have never done marketing before, and [Egg!] is our first real product launch,” said Chen. “When Egg Baby was ready, we just dropped it into the app store without much thought; it was more of a test than anything. To have a successful launch with a team that hasn’t really done it before is pretty cool.”
Looking back at her whirlwind couple of years, Chen thinks of the time as a period of learning rather than a trial by fire.
“It’s been a huge learning experience,” said Chen. “Sometimes things move slower than I would like, and I feel like it’s more of a struggle, but when you struggle through something, you learn a lot; these last four years have been more of a learning experience than anything. I can feel the growth in myself from looking back to five years ago.”
Image via Nix Hydra.
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