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FintechInnovation of the WeekStartupsJuly 22, 20220Innovation of the Week – July 22, 2022

by Venadar Market Intelligence Team

Azra Games – Fintech

What it is: 

Azra Games sits at the intersection of fintech and the video game industry, using web3 technology to combine gameplay and digital ownership. Azra Games creates non-fungible token marketplaces within immersive online role-playing game universes, each with specialized economies for virtual collectibles. The company will make money by issuing and selling tokens and other digital assets, then charging commission on in-game transactions.  

Players own their characters by purchasing a Play Forever Pass upfront and can earn tokens as they go along. Each token the player earns is recorded on the blockchain, and can be used to prove ownership, authenticity, and provenance. The characters will be ‘staked,’ which means the asset will be locked into their digital wallets. This practice allows holders to earn an income from their NFT while maintaining ownership. The players start building their inventory of in-game assets in the Corvus Galaxy, and each item can be used and exchanged in perpetuity through later game iterations and universes. Each NFT comes with special rewards and abilities that owners will be able to leverage in future battles and adventures.  

The NFTs will be minted on Ethereum. Why Etherium? Etherium was one of the first blockchains, so it got a head start on building a community, now boasting over 4,000 active monthly developers (source). It has more wallets, liquidity, bridges, and Layer 2 solutions than any other blockchain. To explain further, bridges allow people to transfer assets from one blockchain to another. Layer 2 is an umbrella term for solutions that build on top of Layer 1 to improve the scalability of the Ethereum network. Essentially, it makes Ethereum more usable for a greater number of people by reducing time delays and transaction fees. One notable Layer 2 solution of Etherium is the network of channels that allow two people to make unlimited transactions, and only the first and last exchange gets submitted to the blockchain. Since all other transactions are handled off chain, they are fast with very low transaction fees, and leave a smaller carbon footprint (source). Azra’s battles will play out on Layer 2. Since it’s important to ensure low latency and quick transaction time while players are interacting, minting on Etherium was the clear choice for Azra (source). 

Legions & Legends will be their flagship game, which they plan to expand into a larger franchise with multiple titles. The game pulls inspiration from Dungeons and Dragons folklore, and the collectibles element of Warhammer 40K. The concept of the game is one that naturally brings NFTs into the storyline. Players are members of the Genesis Merchant Company, exploring a new universe. They discover evidence of a prior civilization destroyed by a massive war. The explorers are prospectors and traders who seek to extract the valuable relics of these warrior civilizations from their abandoned battlefields (source). 

Who Made It? 

Azra Games was co-founded in 2022 by Mark Otero (current CEO), Travis Boudreaux (CTO), and Sonny Mayugba (COO). The team consists of a combination of crypto experts and gaming veterans. The company is headquartered in Sacramento, California. 

Mark Otero is best known for Electronic Arts’ top-grossing Star Wars: Galaxy of Heroes. He shares what makes this game launch special: “this will be my ninth collectible and combat RPG, one that builds upon and perfects the genre I’ve spent my entire career developing. I truly believe that we’ve cracked the code for a captivating gameplay experience built around the joys of collecting toys and taking them to battle against each other, just as we used to do when we were kids” (source).  

CTO Boudreaux has held CTO and VP of Engineering roles at several startups including UpWork.  COO Mayuba led Growth at Swimply and was a founding CMO at Waitr.

Funding status: 

The company raised $16.12M through a combination of debt and Seed funding in a deal led by Andreessen Horowitz and NFX in May 2022. Coinbase Ventures, Play Ventures, ROK Capital, Franklin Templeton, SOLBigBrain, and other undisclosed investors also participated in the round.

Why we like it: 

  • Although NFT’s took a tumble, volatility is part of the nature of cryptocurrencies. Assuming crypto pulls through, web3 gaming will be a core beneficiary of that successful outcome. In 2021, 20% of NFT sales volume and 49% of crypto wallet activity were gaming-related (source). Plus, virtual land sales total nearly $2 billion. These are all strong signs for web3 gaming.  
  • Pay-To-Win games are controversial in the e-sports world, but they undoubtedly drive revenue. For instance, FIFA, NFL and Madden Ultimate Teams, the pay-to-win mode add-ons to the popular franchises, make up 30% ($1.62 billion) of the company’s total revenue 
  • As CoinDesk commented in their MetaVerse series, the practice in video games of transferring weapons, cosmetic “skins” and high-level accounts is already happening, and it is a multi-billion dollar industry. Valve, for instance, authorized this player-to-player trading, and generated tens of millions of dollars in revenue for itself and for independent skin designers. The downside of trading is the difficulty in proving ownership. By putting these in-game assets on the blockchain, Azra Games is in a position to delight players who want to earn and trade without fear of rip-offs (source). 

Did you know?  

Real Estate is booming – virtual estate, that is, in web3 gaming universes. Entropia, for instance, a massive multiplayer gaming universe, sells land deeds for $100 apiece, and the larger purchases are even more staggering. So far, investors spent $330,000 on a virtual space station, another bought a virtual resort for $635,000, and incredibly, a $6 million dollar planet within the gaming universe was recently purchased by SEE Virtual Worlds (source).  


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