Nov 10, 2019

5 Take away from Spiel Essen 2019 for Capital Gains Studio

Spiel Essen has been an annual event for Capital Gains Studio as we always attend to say hi to old friends and make new friends. This year, we headed back to Spiel Essen 2019 without a brand new game. This year, we are only bringing over a 2nd edition of Wongamania: Banana Economy and a set of prototype of our to-be launched game: Kaiju Exchange. With only a 2nd edition game to sell, how did we fare? I will say pretty good actually. These are the lessons from Spiel Essen 2019.

Increase sales through an increased frequency of play

In 2018, we took the standard 2 X 5 booth and had a table for Debtzilla and Cryptocurrency each. Like all new game launches, people are eager to try out the game, but each game takes an hour to play. We often have to turn away players who are looking to try the game, while trying to encourage the present players to cut short their game play. However, they almost always pleaded with us to let them finish the game and we always relented. With more and more games being launched at Spiel Essen each year, gamers are spoilt for choice and most gamers will prefer to buy games that they have tried and liked. Moreover, Spiel Essen is the sole convention which we attend outside of Asia, and hence it has became our most important channel for us to introduce our games to an western audience. Allowing as many gamers as possible to play your game help to spread the word and increase your sales!

Showcasing old games is good for business

As the result of a larger booth with more tables, we managed to interact with more gamers as they came to try our games. Some of them even remarked, "Hey, this is the first time I seen your game. Is this a new publish?" Spiel Essen has grew quickly in size since our first attendance in 2015 and it is now near impossible for visitors to see everything in a single year. Even though we have presented our games in 2018, the titles are still relatively new to the visitors, due to a lack of marketing budget for a small indie publisher to market in the western world. In 2018, we didn't manage to sell out or copies of Debtzilla and had to carry back cartons of unsold goods. This year, we managed to sell out all our Debtzilla sets by Saturday! This debunks the conventional wisdom that old games do not sell as well in Spiel Essen.

Large scale playtesting for new games

We brought our latest game "Kaiju Exchange" to playtest with the visitors and even though the game was play tested extensively in the past 6 months, we are still able to find new improvement as a result of the feedback from a more seasoned audience pool at Spiel Essen. You will have game designers, media people and publishers coming by to try your game and giving critical feedback, ideas and possible new mechanics. The kind of feedback we get from Singapore and Spiel Essen is quite different due to the kind of gaming experiences they have. Singapore, with a less mature boardgame industry, tend to give more feedback on graphic design while the Spiel visitors are able to deep delve into mechanics and statistics discussions which helps tremendously in moving our mechanics design forward.

Diversify your logistics.. but things can still go wrong!

This year we shipped our main batch of games by air to Spiel Essen while bringing a small quantity of games with us on our check in luggage. Lady Luck decided to take a rest break and our main shipment was stuck at the German custom due to high volume and our checked in luggage got lost in flight transition. Other than our marketing collateral and demo game sets. We literally have nothing to sell for the first day, until a huge amount of frantic phone calls both from Singapore and Germany managed to solve the problem. We managed to get our main shipment of games in by day 2 but the damage to sales was done. This year, we took the extra care to ship in the games 1 week earlier than the previous year and bad things can still happen. In fact, we talked to some other publishers and many of them also have goods that were stuck at the customs. Guess we need to do more planning and diversification in getting our goods to Spiel Essen next year.

Branding.. Branding.. Branding..

We started promoting Debtzilla to the Spiel visitors in 2016 and this year, we often here visitors walk pass us and remarked "This is the Debtzilla company!". Though we are still relatively unknown in the western gaming markets, our Debtzilla branding did help to increase the mindshare of the visitors in Spiel. Our "Poke Debtzilla for Luck" activity has been tremendously successful and many visitors couldn't resist the temptation to give our cute Debtzilla plushie a poke when they walk pass us.

All in all, Spiel Essen 2019 has been a fruitful year for us as we talk to old friends, make new ones, sold our games and we learnt quite a bit in the logistic crisis management on how to better prepare for our next Spiel Essen.

Feb 12, 2019

Review of 2018 Fengshui Market Prediction and What Awaits Us In 2019

In East Asia, the Chinese are a huge fan of Fengshui, and they have been used from determining where you live and how you decorate your house, in hopes of wanting to gain an edge over others in the race to gain money, fame and status. Fengshui is also known to have the ability to predict the future and naturally, it becomes a tool to predict one of the biggest wealth creation tool - The stock market.

CLSA is a wealth management firm based in Hong Kong and has been publishing their Fengshui stock prediction over a decade. We now take a look at the stock prediction for 2018 and how well it matches to its real world counterpart, which in this case, uses the Hang Seng Stock Index.

Dec 31, 2018

The Bull Market - The Beginningof the End

In the last article, I covered the 3 indicators to watch out to signal an impeding global recession and a Bear market. In the month of Nov, one of the indicators, the US treasury yield curve, turned inverted for the first time in the last 10 years. Automated trading systems that are watching out for similar indicators triggered a sell trade on a wholesale basis leading to a 8% crash in the overvalued US stock market within a single week. Some of the analysts lay blame on Trump for shutting down the US government while trying to get the government pass a bill to build the Mexican wall, others blame the US Federal Reserve for rising the interest rate when the stock market is going through a soft patch. The tension between US and China in their arrest of the Hua Wei CFO and various Canadian citizens created doubt if the trade war can ever be resolved in the near term. On the other hand, there was an influx of good news such as a record year end shopping sales revenue, low employment and low inflation rate.

Nov 2, 2018

3 Reasons Why This is not the end of the Bull Market yet.

Just when people think that US is impervious to the problems that has plagued the Emerging Markets since the start of the year, the day of reckoning finally came as the US stock market joined the Europe and Emerging Market counterparts and plunge into correction zone.

The first question investors have been asking since the start of the fall - "Is this the start of the bear market?" Let us look at some market indicators to help us estimate how far we are in the economic cycle.

Aug 13, 2018

How a Tweet Crashed the Turkish Lira.. and Affected the Rest of Asia

Picture from NY Times

The Turkish Lira crashed 20% within a few days and the fall was accelerated by a speech by Turkish President Erdogan and a Tweet from US President Donald Trump...

"There are various campaigns being carried out. Don't heed them," Erdogan said Thursday "Don't forget, if they have their dollars, we have our people, our God. We are working hard. Look at what we were 16 years ago and look at us now," Erdogan told supporters.

A few moment later, Donald Trump tweeted.

Jul 6, 2018

Kickstarter Fulfillment - What can go Wrong?

As we move into the fulfillment portion of the Debtzilla Kickstarter campaign, people are asking us why aren't we making a formal announcement that shipping has started. Backers often expect to receive their game in a matter of a week or two once we announce is that the shipping process has started. However, we have learnt much from our previous kickstarter campaign how things can go wrong, from the simple process of moving goods from factory to the fulfillment center, which may delay the whole process up to a month or two. Therefore,  we are holding back any formal announcement until the game is safely loaded onto the planes and ships. Let me share with you what are some of the things that can go wrong during this process.

Jul 3, 2018

US China Trade War Escalate. What should Investors do?

The US steel tariffs initiated by President Trump on major trade partners was initially thought to his bluff leverage concessions from trade partners, especially China. Seems like Trump is serious about his threats and the tariffs went ahead. Major trading partners put together a list of tariffs ranging from orange juice and whiskey to inflict pain on the agricultural support base that has propelled Trump to power. With another round of US tariffs of $34 billion worth of China goods going to take place on 6th July, the world turns their sight onto the Chinese government and their counter response to the tariffs. The Chinese government has already indicated that they will not step down and with Trump seemingly going to fight to the end, a major global trade war seems to be looming on the horizon.

Jun 11, 2018

Hyflux Perpetual Securities Saga - Lessons to be Learnt

Hyflux, the once the poster boy (or girl) of Singaporean entrepreneurship has stunned the market by in May 2018 by applying to the court for bankruptcy protection in order to reorganize its debt. When the perpetual securities was announced in 2016 with an attractive interest rate of 6%pa, retail investors scrambled to subscribe to the bonds with its attractive yield. Lured by its status as a company that manages a strategic national resource and given endorsement by the government, investors piled into the perpetual bond thinking that it is a safe bet. Hyflux raised $500 million with an initial intention to raise $300 million. The default caught the retail investors by surprise, with some of them elderly folks who have invested their life savings into the bond, with little understanding the kind of risk they are taking on. With the securities suspended, this group of investors can no longer redeem their capital and can only pray that the government comes in and bail Hyflux out.

Government Backed doesn't mean it is Safe

One of the fallacy that Singaporeans have is that they place too much trust on companies that deemed to be protected by the government. For example, Noble group is invested by China's sovereign fund Chine investment corporation and still defaulted on their bond payment despite supported by CIC. Recently, the government rattled the widespread belief that the HDB is a "confirm make money" asset and they may let the lease on HDB run out, resulting in a wiping out of an essential retirement asset seen by many Singaporean.

HDB, once seen as a government guaranteed investment, is no longer seen as a safe bet.

As much as we want to place trust on securities that are backed by governments, political change and geopolitical risks can easily upend whatever assumptions investors have and turn a safe bet into a sour one. One good example is the political tsunami in Malaysia. Stocks of companies that are friendly to the previous administrations are knocked down while companies seen to be associated with the new government seen their share prices soar.

Diversify if you are Financial Illiterate about Bonds

One of the reason why the Hyflux saga became a human story is due to the fact that many mum and pop put their life savings into the bond. Retail bond, being a relatively new asset class in Singapore, is unfamiliar to many investors and is often mis-sold as a product comparable to fixed deposit in Singapore. This is something similar to the Lehman mini bond saga. Financial consultants should be the first line of defence to help investors understand the risk of such high risk bonds and should dissuade vulnerable investors from investing too much of their life savings into the product. Sad to say, many of those are lured by the promise of a big commission and probably has a hand in encouraging these investors to empty out their life savings as opposed to advising them to invest in a  well diversified bond fund. This observation is made base on a conversation with a friend whose elderly father invested his life savings into the Hyflux perpetual bond.

An investor who has invested in a Singapore bond fund with a small percentage of the fund size invested into Hyflux bonds will probably suffer as much damage as buying into an individual bond and investors can still have the chance to liquidate their funds even if one bond is suspended. 

A new Temasek linked bond - Astrea IV Bond 4.35%

As the damage of the Hyflux bond starts to ripple through the society, a new bond, Astrea IV Bond is
offered by Temasek, giving retail investors to gain exposure to private equity. Private equity is an investment into companies that are not listed on any stock exchange and is generally not easy to buy or sell. Imagine buying into Grab and Carosuell! However, we all know that many private equity companies fail, as testified by many angel investors and venture capitalist.

So from the lessons we have learnt from Hyflux and Noble, securities linked to the government are not as safe as people think and you should NEVER invest all of your money into a single bond issue unless it is explicitly guaranteed by the Singapore government, such as the Singapore Saving Bond.  

May 10, 2018

What is $70 Oil Price Trying to Tell Us

A year ago, I wrote about why commodities is in a sweet spot to invest in and at that point in time. Oil is hovering at around the $50 mark, and fast forward to 2018, oil has reached a new high at $70, having appreciated 40%. Even though oil has performed exceptionally well, its performance has been eclipsed by Bitcoin with a 500% yearly gain. For investors who are looking for a high risk investment and has a more practical use as compared to cryptocurrency, oil may be your answer.

Apr 10, 2018

Trade Wars Are Good... And Easy to Win! Not When you are Facing the Chinese...

The trade war initiated by President Trump escalated in the month of March as he instructed the US government to devise a plan and impose a tariff on $50 billion dollars worth of goods targeted at China. Unfair trade practices, stealing of US technology and intellectual properties are some of the reasons stated for the implementation of the tariff, in an attempt to narrow the $385 billion trade deficit with China.  In retaliation, the Chinese government implemented a 25% on 128 U.S. products, ranging from wine to soya beans. As of now, the proposed tariffs are just threats which will only be implemented come June 2018. Meanwhile, diplomats from both countries scramble to nail some form of agreement together, in order to let both superpower retreat from a devastating trade war with their face intact. Meanwhile, President Trump and President Xi took to the media to denounce the unfairness of the treatment to their respective countries.
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