Risks Specific to fun-gi
Our company, fun-gi, is pre-revenue, and is raising capital to build and market a product we hope will define a new genre of game with the reknown of Chip & Joanna Gaines from HGTV's hit show, Fixer Upper.
Investors won't see a return until the company is acquired or IPO's.
3. Even with the partnerships and media support of Chip & Joanna Gaines and Scripps/HGTV, the game might not grow with enough players to generate revenue at the scale needed to support revenue, and thus marketing growth.
4. Mobile and VR games as an industry is still growing at a rapid pace, but consumption of media can be fickle where users may not be interested in this new type of game.
5. The consumption of any type of game content competes with the consumption of other types of media including television, movies, social, books, and other games.
6. The games industry is highly competitive with studios and publishers who possess greater financial, developmental, and marketing resources than fun-gi; even though these competitors would be limited with speed to market (given the intensity of engineering and art needed to compete) and the lack of carrying the brand power of Chip & Joanna Gaines.
7. The organic distribution and presence of our House Flip game is dependent upon the brand power of Chip & Joanna Gaines which carries the risks of many well-known and popular figures such as intense public scrutiny from the media.
8. The development of a first-of-its-kind game requires heavy commitments on engineering, design, and art; thus making it a lengthy process and may not be fully completed within anticipated timeframes.
9. Game development in general is an iterative process that requires persistent feature and content delivery which exposes its users to both positive and negative experiences until it is refined.
10. The social and networked nature of the House Flip game requires an Internet connection to 3rd party platforms and servers which can be susceptible to outages despite standard industry service level agreements.
11. While fun-gi and their development partner, Section Studios, are both committed to bringing on employees who are enabled to execute at the highest levels, the combination of talent, discipline, and dedication are difficult characteristics to find and retain in a team that can build a product with AAA quality.
12. The freemium business model does rely on economies of scale with a large user base, but every game monetizes at different levels which requires constant improvements. Even beyond insufficient users, convincing players to open their wallets to spend money on a game (even one they love) is not an easy task.
13. The future games fun-gi will develop beyond House Flip depend on timing and relevance of growing brands which can be uncertain.
14. The history of fun-gi allowed the development of its product with capital from past investors. The future operations depends on fun-gi's ability to create revenue. While fun-gi may consider additional funding in the future through debt and/or equity financing, there is no assurance that additional financing will be made.