Business model of Klabster SA
Klabater SA is developing a diversified business model based on three balancing pillars: publishing, development studio and porting. The publishing model guarantees the company stability of revenues and allows it to maintain their level both by releasing premieres and developing its own back-catalogue. At the same time, under this model the company does not bear the risk of financing game production and its financial outlays in the form of advance payments are subject to quick return after the release of the games. The production model allows the company to develop its own portfolio of games and generate high-margin revenue from their sale, and over time to become independent of external content providers. The porting model, as a service, is an additional, complementary source of high-margin revenue and builds competitive advantage over other publishers in the market.
Since its inception, the company’s core business has been publishing in the area of video games for computers (PC and Mac class) and consoles (PlayStation 4, Xbox One and Nintendo Switch). The business model adopted involves searching for, evaluating and acquiring video games from development studios, and then marketing them on the global market in physical or digital form. Distribution in the physical model takes place through a network of distributors and independent shops, while in the digital model through digital game distribution platforms. Computer games are released in digital form through dedicated platforms, in particular such as: STEAM, GOG, GMG, Humble Store, Fanatical, Windows 10 Store, while console games through platforms such as: Sony PlayStation Network, Microsoft Xbox Live and Nintendo Switch eShop.
Klabater SA as an external publisher is an optimal solution for producers just entering the market, who do not have sufficient own resources to finance a project at the initial stage of development. An additional advantage is the diversification of the risk of failure of a published game, which is distributed between the publisher and the producer.
As a publishing house the company offers a wide range of services for game developers, supporting them at every stage of work, in particular in the area of
• planning and implementing marketing campaigns,
• production management and financing,
• digital and physical distribution around the world,
• game localisation,
Game production is a relatively new segment of Klabater SA’s business activity, which was created in order to use the company’s experience in game development and the business opportunities offered by the production of original titles, including achieving higher margins compared to the publishing model.
As part of production activities, the company wants to invest funds in the production of games based on its own ideas and acquire rights (licenses, IP) to recognized existing brands which have gathered fans around the world. To this end, it is developing its own development team for the production of original games under the Kraken Unleashed brand.
The company has also made porting services part of its business model. To this end, in Q1 2019 it built a department dedicated to porting games from PC platforms to console platforms. In the first instance, the porting team focuses on providing services internally, for games acquired for the publisher and for the company’s own productions. Over the next few years the company intends to start providing porting services in the publishing model to third party companies – clients from Poland and the CEE region.