Gaming start-up PlayUp is launching its first product in Australia, after selling its products overseas for 18 months, becoming the latest Australian business to prioritise foreign markets over domestic consumers.
PlayUp, which sells sport-based mobile phone games, was founded in 2007 by George Tomeski and Luke Bunbury. The founders initially raised $5 million from angel investors.
In 2008, a second capital-raising collected $18 million. Then in April this year, the company raised $US50 million from four Hong Kong investors.
While most of the company’s development work is done in Melbourne, it has sales and marketing offices in six international markets, including China.
The founders have struck deals with telecommunications companies in the United States, India, Japan, Brazil and parts of Europe.
Its content agreements cover groups such as the Indian Premier League, the English Premier League, and gridiron, hockey, baseball and basketball associations in the US.
The company’s Australian agreements include the Australian Football League, cricket and rugby union.
Tomeski says PlayUp will now focus on selling mobile phone apps in Australia, but will not discuss distribution agreements with any local telcos.
The launch of its first product in Australia comes via the global release of a free PlayUp application for Apple’s iPhone in early October.
About 56,000 applications were downloaded by consumers in the US, Europe, Middle East and Australia in the first week.
In December, PlayUp will release a second version of the application, which will allow users to buy content from sports organisations, media companies, sports statistics companies, and individual athletes.
Until the iPhone application was introduced, PlayUp’s main business was adding games and other interactive content to live sport distributed via mobile phones.
While PlayUp would not reveal any figures, Tomeski says the company is generating revenue “at a decent clip,” particularly out of India, which is a key market.
Patrick Collins, chief executive of mobile solutions provider 5th Finger, says even though the Australian market is full of “amazing” entrepreneurs, the investment industry isn’t overly strong.
5th Finger is a wholly owned Australian company but operates solely in the United States. It was recently named the eighth fastest-growing company in San Francisco by Inc.com.
“Companies that build consumer-facing propositions have a higher chance of success given that these business models tend to be less location-centric,” Collins says.
“However, consumer-facing business models often demand higher levels of cash than the Australian investment industry has at its disposal.”