Boardgames in the News: Are Asmodée Taking Over the World?

Asmodée is the French translation for Asmodeus, and according to Binsfeld’s classification of demons, Asmodeus is the demon of lust and is therefore responsible for twisting people’s sexual desires.  In the boardgame world though, Asmodée (originally known as Siroz) are a small French game publishing and distribution company, specialising in the family market. For example, they are well known for Dobble, Dixit, Time’s Up! and Ca$h ‘n Guns, but they also publish some more challenging games including Snow Tails, Mr. Jack, Formula D, Takenoko and 7 Wonders.

Jungle Speed
– Image used with permission of BGG contributor kilroy_locke

Asmodée was started in 1995 by Marc Nunès, a self-trained entrepreneur developing role-playing games, but quickly became France’s foremost games publisher and distributor.  One of the big early successes was Jungle Speed, launched in 1998, which has since gone on to be one of the top-selling titles in France, rivalling Monopoly, Trivial Pursuit and Pay Day.  The real turning point came in 2003, however, when Asmodée obtained the French licence to distribute Pokémon collector cards, which opened up the mass retail sector.  This development led to an 18% investment from Naxicap in 2005.  Naxicap’s stake was bought out two years later by Montefiore who acquired 60% of the company as part of a deal with management worth €40-50 million.  Montefiore invested €120 million to finance Asmodée’s international growth, funding the acquisition of the Belgian game distributor Hodin in 2008, the Spanish games developer Cromola and the German Proludo in 2009, followed by the purchase of a 60% stake in the UK-based distributor, Esdevium Games in 2010.  Asmodée also strengthened it’s portfolio with the acquisition of Abalone and partnership with Libellud (leading to the distribution rights for Dixit) in 2010.

Abalone
– Image used with permission of BGG contributor msaari

In 2012, Asmodée branched out further, setting up a subsidiary in Shanghai, China,  with the intention of expanding “into a new market taking advantage of Asmodee’s extensive line-up of games and the existing relationships with partners, thus promoting the brand in mainland China, Hong Kong and Taiwan”.  This ambition brought Asmodée to the attention of the Eurazeo, a European investment company and a deal was announced in November 2013 that valued Asmodée at €143 million.   In January, 2014, almost exactly a year ago now, Eurazeo bought 83.5% of Asmodée through an equity investment of €98 million while Asmodée’s management team and original founders reinvested €14 million of their own money.

Ticket to Ride
– Image used with permission of BGG contributor garyjames

With the backing Eurazeo provided, Asmodée then went big:  in August last year it was announced that Days of Wonder would be “merging into the Asmodée Group of game companies”.   Days of Wonder are one of the biggest names in modern boardgaming, and are often credited with the growth of the modern boardgame industry, thanks largely to their flagship Ticket to Ride games, which have sold well over two million copies to date.  This is not the only “big game” in their catalogue either, they are also responsible for Memoir ’44 and Small World, both of which are popular games, demonstrated by the number of expansions they support and which take Days of Wonder’s total number of games sold to over five million since their founding in 2002.

Small World
– Image used with permission of BGG contributor crosenkrantz

According to Forbes, Days of Wonder generates between $10 million and $20 million in revenue annually, not bad in such a niche market.  From Eurazeo/Asmodée’s point of view, such an acquisition makes sound financial sense, not just because of the commercial value, but because they already provided a lot of the distribution for Days of Wonder games.  This wasn’t enough for Asmodée however, and three months later, they acquired the U.S. publisher Fantasy Flight Games.

– Image used with permission of BGG contributor adamfeldner

This was a bit of a change of direction for Asmodée:  hitherto, all the acquisitions had been firmly in the family boardgame and distribution markets.  Fantasy Flight games are a very different animal and their headline games, Twilight Imperium and Arkham Horror are much less family friendly.   Even their X-Wing Miniatures Game which is very popular with fathers and sons, is a long way outside the normal scope of Asmodée, since it is essentially a two-player war game with a Star Wars theme.  However, there are considerable benefits for both parties, since the merger will enable Fantasy Flight to improve its distribution in Europe, while simultaneously giving the growing Asmodée Group access to Fantasy Flight’s North American sales and marketing teams.

Black Fleet
– Image used with permission BGG contributor Toynan

Asmodée weren’t stopping there, however, with Ystari Games, Asterion Press and Pearl Games also becoming “part of the Asmodée family” late last year.  The link with Ystari Games almost certainly comes from their mutual interest in Space Cowboys.  Space Cowboys is a game creation studio created in 2013 by Marc Nunès (who started Asmodée way back in 1995, remember?), Philippe Mouret and Croc (both of Asmodée), Cyril Demaegd (Ystari) and Sébastien Pauchon (GameWorks).  Space Cowboys is a very small outfit, but already has one Spiel des Jahres nomination under its belt in Splendor and looks to be trying for a second with Black Fleet, the gorgeous pirate game released at Essen last year.

Eurazeo
– Image from eurazeo.com

So, what are Asmodée up to?  The concern is that gamers generally like the current diversity in the market and fear that this succession of mergers and partnerships will mean a homogenisation of the games available.  The November 2014 Eurazeo “Investor Day” report spelled out the current state of Asmodée in detail and the good news is that this does not seem to be Eurazeo/Asmodée’s intention.  The report states, “Each studio has its own DNA,” and goes on to say, “Repeated success lies in the full independency granted to these studios, to keep innovating.”  So it seems the diversity is valued, however, by acquiring mid-sized publishers like Days of Wonder and Fantasy Flight, Asmodée is positioning itself to compete more effectively with multinational toy giants like Hasbro and Mattel, who publish top board game brands including Monopoly and Scrabble.

Eurazeo
– Image from eurazeo.com

So, is it a good thing that Asmodée are setting themselves up to rival the big boys?  Well, Asmodée is not the only company to engage in mergers:  in 2011 Filosofia purchased the U.S. publisher Z-Man Games, and U.S. publisher FRED Distribution (which releases games under the Eagle Games and Gryphon Games brands), acquired U.S. publisher Face2Face Games.  More recently, in late 2013, Mayfair Games (the U.S. partner for Catan) bought a controlling interest in Lookout Games (the company who first brought Agricola, Caverna, Le Havre and Ora et Labora to the market).

Asmodee
– Image from forbes.com

Clearly a large stable company provides security for designers, as well as providing support for the individual studios who know that one poor decision is no-longer likely to bring about the end of the company, both of which have to be A Good Thing.  However, companies like Eurazeo invest for only one reason:  financial return.  With an effective monopoly, Asmodée are now in a position to squeeze the market, indeed we may already be seeing the evidence of this in the price rises announced at the start of the year.  With this in mind, it will become clear in due course whether Asmodée is good for boargaming in the UK or whether it is genuinely the demon of lust responsible for twisting our gaming desires…