EXCLUSIVE: “Game On!” – Elaine Dowman, Barclays in ‘The Fintech Magazine’

Elaine Dowman explains why Barclays is betting on the UK’s video games industry

That’s bigger than the film, TV and music industries combined. Globally, it is estimated to be worth more than $200 billion by the end of this year. And right now, more than three billion people worldwide can do it. What is it? Gaming. The creativity of UK developers has placed the country at the top of the industry leaderboard in Europe, generating £7.1 billion in revenue and reaching up to a fifth of the UK’s adult online population. It’s been a GGWP (good game, well played) in gamer parlance. No wonder Barclays Bank wants to be part of it.

“Barclays has been involved in the creative industry since the 80s [but with] an increasing focus on the gaming area over the past four years, says Elaine Dowman, the bank’s head of games and creative industries, who is herself a gamer.

“After a really long day at work, I often sit down and play… kind of relax and unwind, and escape to another world,” she says. Almost 3,000 gaming-related businesses in the UK are involved in creating the alternate reality. A growing number of them are small, independent developers who often struggle to get the investment they need. “It makes sense for a bank to support the growth of these UK businesses,” Dowman says. “Developers need to understand economics, because they want to pump a lot of money into a game pretty early on. Designing a game can take anywhere between two and seven years. It’s hard to show a prototype because a lot can change during that time, so getting early stage funding can be a challenge.

“We can help from a banking perspective, but we also have specialist products, such as a video games tax credit loan, which allows businesses to borrow against HMRC’s video games tax relief.” Dowman’s team is doing a lot to expose these gambling businesses, she says.

“We will run demo days, invite contacts and investors to see what these businesses are doing and let them talk about their games. We also collaborate with the industry association UK Interactive and Entertainment (UKIE). They promote the UK games industry globally and their line is that the UK is the best place in the world to make games.”

The bank is currently running a six-month mobile gaming scale-up program with UKIE, tapping into one of the fastest growing segments.

“There are a lot of game scaling programs out there, but very few that focus on the nuances of mobile,” explains Dowman.

In fact, according to Statista, mobile games, with different monetization strategies and the much larger user base provided by smartphones, will account for a whopping 85 percent of global video game revenue by 2023. As a global bank, Barclays works with the industry from corporate to grassroots level and has a well-developed compared to larger publishers who can support smaller studios. In fact, increasingly, major publishers are working with and acquiring independent studios that will come under their brand but still operate independently.

“They also need support financially, and may need funding or exposure,” says Dowman.

“Many industries are looking to games for innovation, especially in the micropayment space”

THE EAGLE LABS

Arguably the bank’s most important offering to aspiring games companies is the Eagle Labs programme, which recently won the UK Government’s Department for Digital, Culture, Media and Sport Digital Growth Grant to accelerate tech start-ups and scale up ecosystems across all regions and nations of the country . Great Britain. Eagle Labs will be responsible for supporting the UK technology sector as a whole from April 2023 until at least March 2025, taking on the role previously held by the non-profit organization Tech Nation, which had helped bring more than 5,000 startups to market since 2011. including UK fintechs Monzo and Revolut. It will close its operations this month.

David Hamilton, Barclays’ head of implementation, was keen to counter criticism of the government’s decision to select the start-up incubator arm of a FTSE 100 bank to receive taxpayer funding, saying Barclays had “got our hands dirty” supporting start-ups and scale-ups for the past seven the years.

“We’re not late to the party,” he said.

In fact, the bank’s Eagle Labs UK network has grown to 38 brick-and-mortar sites since its inception in 2015 covering the whole of the UK. Six of these Eagle Labs are game-based. That’s good news for smaller developers, who can access the site’s developer suites, kits and dedicated computers.

“In some of the studios, we even have motion capture equipment,” adds Dowman. As any developer will be painfully aware, hiring this kind of equipment and studio time can be prohibitively expensive. “We can give them the equipment they can use, and test things with, before they invest more money in it,” says Dowman.

Gaming companies can find support across the entire Eagle Labs network, but the specialized equipment and knowledge at these six labs can be invaluable to a startup.

“We’ve tried to locate them around gaming hubs and make them as accessible as possible. We have labs in Belfast, Glasgow, Sheffield, Liverpool, Southampton and Brighton, which is a well-known gaming hub,” says Dowman. “We hold a lot of events in these areas , and build a regional community around them for developers, because it can be quite lonely to be in. Many developers start their business in their bedrooms, on their own. They know everything about games, but nothing about having, say, an accountant or a lawyer .Eagle Labs can provide these introductions.

AN INDUSTRY FOR THE NEXT GENERATION

Making these kinds of connections is especially useful as crossovers with other industries become more apparent. One in particular – with payment technology – highlights the role games can play in innovation, says Dowman.

“A lot of industries are looking to gaming for innovation, especially in the micropayment space. You just have to look at the streaming world and esports. And because it’s a global industry, there’s a need for currency… I’d say gaming is leading the way in this area.

“The growing eSports sector is dominated by younger players and as such there is also potential for the bank to play a role in financial literacy. “You have young people who are eSports players, content creators, YouTubers or streamers on Twitch, who make quite a bit of money,” says Dowman. “There’s a lot of focus on esports players in particular and their mental health, fitness and diet. But what about financial literacy? We have done a lot of work in the past with Premier League footballers and we are now transferring that experience to the gaming area.”

ADAPTING TO GLOBAL CRISIS

If gaming wasn’t on investors’ radar before the pandemic, they couldn’t help but miss it afterward. Who hadn’t heard of Nintendo’s island simulation game Animal Crossing: New Horizons by the end of 2020? Launched in March of that year, it sold 13.4 million units in its first six weeks. Another 2020 success story was PC multiplayer title Fall Guys: Ultimate Knockout, which generated 11 million unit sales in four months.

“They were a form of entertainment that you could play with families at home, but also bring people together internationally to play games, talk and share,” says Dowman.

“There are incredible stories of grandmothers and grandfathers teaching so they could play with their children on the other side of the world to still be able to connect with them.” Within the first months of the pandemic, lockdowns led to a double-digit increase in time spent playing games worldwide – in Latin America, screen time increased by an astonishing 52 percent, according to Statista. As a result, worldwide digital game spending on in-game content and paid downloads increased by 12 percent and 21 percent, respectively. It was relatively easy for the industry to scale to demand.

“When the pandemic hit, a lot of businesses, traditional businesses, took a while to adapt to hybrid work, whereas the gaming industry was actually doing a lot of that already, and could change very, very quickly,” says Dowman.

It fueled a frenzy of history-making acquisitions over the next two years. At the moment, the biggest sale of all time – of Call of Duty maker Activision to Microsoft’s Xbox for $69 billion – is in the regulator’s inbox. For lone developers keen to turn their digital fantasies into a business reality and eyeing that mega-deal with envy, Barclays’ message is clear: it’s game-on with us.

This article was published in The Fintech Magazine issue 27, pages 64-65