How Nazara’s success has become a game-changer for the gaming sector

Monday March 05, 2018 , 7 min Read

Nitish Mittersain, Founder and MD of Nazara Technologies, never really understood textiles. His first love was, and has always remained, gaming.

We have had some great startup stories coming out of India, but the road to success is long and, arduous, and often very lonely for entrepreneurs. Few know this journey better than Nitish Mittersain of Nazara Technologies. He founded his gaming company just when the first dotcom bubble burst. He spent the next few years recovering the money he had lost, and jokes that the experience was the most expensive business degree he could have got. So, we were thrilled when he agreed to come and share his journey with us at this year’s Kalaari Summit.

Nitish Mittersain at Kalaari Summit 2018 #ImagineTomorrow

The gift of a future

Over the years, first as an entrepreneur and then as an investor, I’ve observed that while many work hard and learn the ways of entrepreneurship, some are just born with a special talent for it. Nitish, with his unwavering drive to do more, embodies some simple but exceptional qualities that have helped him build a very successful business. I have seen very few entrepreneurs who are as passionate about their work as Nitish is. His eyes light up when he talks about gaming. He was drawn to it as a child, with consoles, cartridges, modems and other video game- and internet-related paraphernalia crowding up his room. But the real tryst with technology and gaming began when his father gifted him his first ZX Spectrum to keep him occupied on trips to his grandparents’ home, not knowing what his son was getting hooked on to.

Coming from a Marwari family meant that his career was already set out for him: B. Com, an MBA, and then back home to help the father with his business. But Nitish never really understood textiles. His first love was, and has always remained, gaming. You can see his joy when he said while talking to the audience at Kalaari Summit 2018: Imagine Tomorrow, “I coded my first game when I was seven, and that’s exactly what I’m doing 30 years later as well.”

Finding a mentor in a legend

But in the India of the early 90s, following your dream, especially if it involved something unorthodox and nascent as gaming, was a lot tougher than it is today.

While in college, Nitish ran a bulletin board service (a precursor of sorts to the internet) and a chance meeting with legendary actor and 60s youth icon Shammi Kapoor helped him crystallise his ideas for a business. In his post-cinematic career, the actor had become one of the earliest users and pioneers of the Internet in India. The man was as passionate about the internet and increasing its usage in India, as he had been with his leading ladies on screen. Who better to discuss the intersection of technology and entertainment than a successful film star and technology champion? They spoke regularly and Nitish believes these long conversations played a role in his decision to go ahead and start a business even though he was still a student. Shammi Kapoor remained a friend and mentor till he passed away a few years ago.

Nitish had seen his friends obsessing over games and thought it would be great to build one to make the most of the nascent market. And so, he set up Nazara in 2000, unfortunately also the year in which the first dotcom bust occurred. He kept at it, not just because creating games is what he loved, but because the crash had shown him that survival was the preserve of only profitable businesses. Generating profits is what every business is meant to do, and that’s what Nazara would do too. Not for him the vanity metrics of fund-raising, definitely not at the time. He credits the journey thereafter to some clear choices and some bits of good fortune.

Finding (and keeping) the right partners

Given that the company started in early days of mobile gaming, Nazara Technologies had the first-mover advantage, which helped them build more relationships and understand the space better than their competitors. But Nitish knew what they needed was a stellar partnership. “Indians love cricket, and back in 2004, Sachin was it!” he told us. So, after six months of relentlessly chasing the legend (and driving a bargain by selling Nazara’s connect with the youth), he managed to get the cricket legend on board. All the subsequent media publicity and sponsors lining up to get on board opened up new opportunities for Nazara, and the company hasn’t looked back since, snapping up brands like Royal Challengers Bangalore and Hrithik Roshan, among others. Having learned the value of association with credible brands, Nazara then joined up with global gaming heavyweight Electronic Arts, bringing them to India and other emerging markets.

The publicity brought with it an offer of investment from Westbridge Capital at a time when Nitish did not even know what venture capital was. He accepted that offer, and a handful of others over the years, but considers it a moral responsibility to ensure that their investment is used well.

As a VC, I believe that every rupee matters, which is something that Nitish learned while growing up. He is unwaveringly dedicated to ensuring capital efficiency and credits this, along with gradual growth, to their subsequent success. Along the way, he has acquired a team that has stood by him for close to a decade now.

“We have no fancy HR policies. Just stable profits and goodwill,” he says. So much so that they haven’t faced a legal case during their entire existence!

Manish Agarwal, CEO, Nazara Games at Kalaari Summit 2018

Another, more recent partnership, if I can call it that, was forged by bringing on board Manish Agarwal as CEO while Nitish himself took on the position of Managing Director. The move brought in an experienced professional with a stellar track record in the Indian gaming industry and expanded management bandwidth at a time when the company was hungry to expand to new markets and new formats. I haven’t seen many entrepreneurs considering the idea of bringing in someone from the outside and hand over the day-to-day running of the business so that they can focus on what they do best. But Nitish did so, and so far, the move seems to be paying off.

What I find admirable is that Nitish has remained steadfast to the basic principles of running and expanding a business and gotten better with every new step that he took. Nazara has a presence in 60+ countries, having successfully replicated the India success stories in similar markets abroad. Always modest, he credits his team — where he has built a credible second layer of leadership — capital efficiency and making the right partnerships, but it’s the entrepreneurial spirit in him that has brought him this far and will hold him in good stead even on the road ahead, which includes a potential IPO sometime this year.

Watch the full video here:

It gives me great joy to see India begin to realise its true potential, leveraging its large pool of talent, resources and bring together the components to drive a technology-led economic revolution.

The world today looks at India in a different light because of the transformation that the country is undergoing. And a huge part of this transformation is owed to the evolution of the startup ecosystem over the past decade.

At Kstart & Kalaari, we are committed to continue playing an active role in fostering India’s entrepreneurial ecosystem and this year’s Kalaari Summit #ImagineTomorrow was one such endeavour where we got together thought leaders from different walks of life to talk about India’s dream of creating a trillion-dollar digital economy. Other topics at the summit include Connecting a Billion Indians, Startup Sarkar: Making Bharat Go Digital, Scaling Up: Getting It Right!

Here’s Manish’s view on shaping India’s Trillion Dollar Digital economy.