ODD1 gains foothold into interactive kids market with acquisition of Tribal Nova’s gaming division

Two Montreal-based interactive entertainment companies – virtual-world producer Tribal Nova and games developer ODD1 Inc. – are joining forces, allowing each to focus on what it does best while reaping the benefits of the other’s business. Similar mergers could soon follow as producers and developers seek to streamline operations, according to Tribal Nova’s co-CEO. “I think we will see more deals allowing companies to move more quickly,” says Guillaume Aniorté. The partnership, announced last week, allows Tribal Nova to exchange its game-production division for an equity stake in ODD1. Jean-François Arseneau, ODD1’s director of business development, says nine former Tribal Nova developers will now work for his company’s studio, bringing the ODD1 staff count to 32. “They started last Monday,” he says. Arseneau and Aniorté say the partnership should allow each business to zero in on specific parts of the industry. Tribal Nova’s claim to fame is the kids interactive realm: the company markets its own products worldwide under the Woozworld brand. It’s also a partner with BCE Inc. in the kidsmania portal, and operates online gaming services for pre-school children in partnership with PBS in the U.S., Éditions Bayard in France, and CBC in Canada. The company is up for a Canadian New Media Award this year for its work on Kids’ CBC Wonder World. Aniorté explains that Tribal Nova, now with 50 staffers, will continue focusing on virtual world development, production and marketing. ODD1, meanwhile, has made a name for itself as a development team for hire, providing Flash, PC, iPhone, and Facebook games for firms such as MTV Networks Co. (AddictingGames), Mystic Box B.V. in Europe, and Salambo Productions, the Canadian firm responsible for the Têtes à claques humour web site. Via the partnership, Tribal Nova will be able to focus on virtual worlds, turning to ODD1 for games development. The move is expected to enhance ODD1’s game-making techniques. . And “if they develop more expertise, we benefit,” Aniorté says. As well, Arseneau points out that the partnership will allow ODD1 to get a foothold in the the lucrative kids interactive arena.. Without Tribal Nova, he says, “it would be difficult for us to get a foot in the door, ”, adding that the digital-media sector for children is dominated by large studios working on established brands. Big brands tend to be the ones that attract parents’ attention, he says – adults feel that they can trust games and videos from established names. At the same time, brand managers do all they can to create compelling online portals to keep children glued to their web sites. That means the brand holders have to invest in new games and content often, making kids-focused games particularly lucrative for developers like ODD1, Arseneau says. The Tribal Nova-ODD1 merger is by no means the first of its kind in the interactive digital market. Driven by the need to advance their businesses, other companies in the Canadian digital-media sector have merged, partnered, and sold off parts of their businesses.. Notable get-togethers include interactive-animation firm Frima Studio Inc. joining with developer Humagade last year – a merger backed by a Quebec-government loan of $1 million – and New Horizon Interactive’s selling the popular Club Penguin kids portal to Walt Disney Co. in 2007. Earlier this year, Tribal Nova attracted $3-million in financing from venture-capital companies iNovia Capital and ID Capital. According to a press statement, the VCs were particularly attracted to Tribal Nova’s experience in the kids digital industry, which the investors see as having plenty of revenue-generating potential. However, Arseneau says merger mania hasn’t hit the Montreal interactive sector yet. Mergers often hinge on cultural cohesion – small firms pride themselves on unique ways of working, so ensuring everyone gels is a prime concern before any money (or stock) changes hands, he explains. Will Tribal Nova make money on ODD1’s service work now? Arseneau and Aniorté say it’s too early to make a prediction, but they point out that the merger will result in better operations all around.

ODD1 gains foothold into interactive kids market with acquisition of Tribal Nova’s gaming division

Broadcast | November 11, 2009

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