Production studio Yggdrazil Group (YGG), known for its popular Home Sweet Home action-horror game, aims to become a SET100 company in the near future and an internationally recognised digital content creator and distributor.
The company's Home Sweet Home video game was a popular title and Hollywood has adapted a movie, Home Sweet Home Rebirth, from the game, with a global release date projected for later this year.
YGG was founded in 2009 to provide special effects, visual effects and computer graphics services. After eight years of operation, the visual effects business stabilised and YGG expanded into the animation business by capitalising on its expertise, chief executive Tanat Juwiwat told the Bangkok Post.
GAME ON
As the company grew, it entered the game market with the launch of Home Sweet Home, based on Thai myths and beliefs, aiming to tap the growing global market.
Entering the gaming market enabled YGG to expand its business beyond offering outsourcing services to have its own intellectual property in the global market, said Mr Tanat.
He said the company did not solely focus on following gaming trends when developing its flagship hit, but rather blending unique Thai culture into the game.
Mr Tanat said it is easier to develop video games now compared with years ago thanks to the availability of advanced game engines.
As a gamer himself, he said he dreamt of developing games for others to play because he knew what gamers needed. Mr Tanat said YGG's key to success is differentiating games from other developers, rather than just following trends.
The company developed Home Sweet Home with the concept of creating a "universe", meaning the game has a series of new episodes and the format will evolve in line with changing technology, he said.
The game is available on Windows, PlayStation 4, Xbox One, and virtual reality devices.
"The company's key to success is differentiating games from other developers, rather than just following trends, blending unique Thai culture into its game." -- Tanat Juwiwat, Chief Executive, Yggdrazil Group
"We have 1 million gamers aged 18-35 playing the game. We always explore modern technology, including artificial intelligence, which will help us cut production costs and speedily deliver products to market," Mr Tanat said.
Since 2017, the game has earned positive reviews from streamers, he said. As the company combats copyright violations, it keeps updating new features in the game, and gamers have supported authentic games, said Mr Tanat.
Later on, the illegal games stopped violating its copyright, he said.
Mr Tanat said the company's listing on the Market for Alternative Investment in 2020 reflected its capability and the potential of its team to make inroads into the global market.
"We are the first digital art company to list on the stock market, which raises our credibility for expansion overseas and helps us maintain our employees," he said.
VENTURING OVERSEAS
Mr Tanat said this year marks the start of YGG engaging in international partnerships, with big progress expected in 2025.
The company started by seeking a foreign alliance in the animation industry and aims to create an overseas distribution channel in the future, he said.
Co-production, joint opportunities and risk-sharing are models that work in the international market, said Mr Tanat.
"These models can help us develop an upstream business and accelerate growth in the overseas market using sufficient investment," he said.
YGG is inspired by the successful models of Japanese multinational video game company Nintendo and China's Tencent, said Mr Tanat.
"We have to expand beyond the domestic market as it is too small," he said. "We need to have our own game intellectual property, with a distribution channel the next step. In a nutshell, we're leveraging our assets and extending our content formats to cover film, animation, games and merchandise."
The company wants to become a co-owner of gaming intellectual property to strengthen revenue streams in new formats on the global market, said Mr Tanat.
To achieve this goal, YGG seeks high-potential partners to collaborate on new projects, he said.
FORAY INTO MOVIES
YGG co-produced and co-invested in an animation series titled Hero Inside, which portrays various heroes from comic books. It partnered with companies such as Tencent and Million Volt, a subsidiary of South Korea's CJ ENM, on the project.
The project completed production on two seasons of the series. The first season was released in some international markets late last year.
YGG also plans to develop games and merchandise out of the series, said Mr Tanat.
The company finished filming Home Sweet Home Rebirth, in collaboration with an American studio partner. It is a sequel to the Home Sweet Home game, which now has more than 370 million streaming views.
The film is expected to be released worldwide later this year, and the company is confident about the response, he said.
Mr Tanat said these projects are attempts by YGG to create Thai soft power in the global market through its products.
"This marks the initial step for YGG to participate in the production of a Hollywood-scale film," he said.
Hollywood-scale films have high market values, presenting an opportunity for the company to diversify and generate revenue in new formats, said Mr Tanat.
"We are confident our profits will grow as a result. Moving forward, you can expect YGG to transition from being a contractor to a creator in upcoming projects," he said.
By focusing on creating original content and owning gaming intellectual property, the company aims to increase its profile, improving opportunities for collaboration with potential partners to develop high-quality content, ultimately leading to revenue recognition in new formats, said Mr Tanat.
YGG is in talks on several other projects with international partners, he said.
The company wants its sales and services business to gain 80% of revenue from the overseas market in 2025, up from the projected 50% this year and 40% in 2023, said Mr Tanat.
Asia is the next growth destination for digital content, he said.
YGG's ambition is to be in the SET100 within three years with a valuation of 20 billion baht, said Mr Tanat.
MIX OF PEOPLE
YGG was established by a group of young workers who are passionate about digital art, he said.
"The average age of our employees is 28-36. We have mixed expertise," Mr Tanat said.
He said his expertise is game-playing and business, while other board members are angel investors or have a financial background.
"This mix combines business and art," said Mr Tanat. "In the digital content sector, we cannot think only about our own preferences, as we must focus on the business and potential market."
YGG can retain talented employees by showing them the bright future for its business and allowing artistic people to be proud of their creativity, as it gains recognition for Thailand if the games become popular, he said.
If employees leave to establish their own business, YGG is eager to invest in them and bring them into its network, said Mr Tanat.
He said the founding members and employees still work with YGG, as it offers company stock to employees.
SOFT POWER
Mr Tanat said in an effort to drive Thailand's soft power in games and animation, the government can facilitate co-investment or co-creation.
He said projects must provide proof of return on investment and key performance indicators, which might not be revenue, but rather soft power that helps to improve Thailand's tourism, image and brand recognition.
Project owners must return investments to a soft power fund for reinvestment in new projects, said Mr Tanat. If a project is less successful, the government can allocate money to others.
The government can also hold discussions with Netflix or other over-the-top (OTT) operators about co-funding with Thai producers to promote Thai soft power in travel and food, he said.
"This could be a win-win. We'll have more distribution channels, gain bargaining power, and OTTs will have new content with some subsidised costs," Mr Tanat said.
Thailand has the creative capability for digital content, but makes up less than 1% of the global market and has lots of small studios, he said. Most Thai gaming studios have 10-20 employees, with only a handful mid-sized such as YGG with 250 staff.
