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IAHGames founder went from distributing junk mail to running a $25 million games publisher

iahgames roland ong

IAHGames founder Roland Ong (right) with Hakkyu Kim, lead developer of popular MMORPG Ragnarok Online. Photo: IAHGames.

Singaporean Roland Ong is the founder and CEO of IAHGames, one of Southeast Asia’s top electronic games publishers. Headquartered in Singapore, the company currently has a network of 35 million registered gamers in Southeast Asia, and it is slated to make $25 million in annual revenue this year through the publishing and operation of titles like Grand Theft Auto V, Granado Espada, and Counter-Strike Online.

But getting there has meant paying a heavy price for creative freedom. In 1987, the free-spirited entrepreneur quit undergraduate studies at the National University of Singapore’s engineering faculty to start a business. He says:

While I very much wanted to do arts, they placed me in engineering instead. The university gave us very little choice and placed us where the national quota was.

He realized three months in that it wasn’t going to work out as Singapore universities trained students to be system maintainers and not creators. So, he focused on the goal of heading abroad to study liberal arts.

The cost, however, was prohibitive. To fund his trip, the only way to make money quickly enough was to start a business. He then poured S$4,000 – his entire savings – into an old delivery van, and starting a daytime cleaning and delivery business by obtaining under-utilized cleaning equipment from a friend’s dad.

By night, he distributed – in his own words – junk mail to apartment blocks, making 50 cents a block for a total of S$50 a day. While decidedly unglamorous, it got the job done, and Roland saved up S$20,000 ($15,907) one year later.

With that wad of cash, he bought 20 computers and started teaching kids how to use computers through electronic games. By the time he sold the business to IT educator Informatics in 1991, he netted S$60,000 ($34,200) from the proceeds, more than enough to buy a one-way ticket to the United States to study liberal arts at Taylor University.

From journalism back to technology

While Roland dabbled in photography and journalism in university, taking sports photos for the campus paper and sleeping three hours a day, he soon found himself falling back into technology.

“I was running out of money,” he says, “liberal arts is expensive, so I had to find work in the computer science department. But the only way I could work there was to take up a communication systems major.”

He pointed out that tinkering with technology was always something that he has been doing as a hobby: he once created his own bulletin board system – a precursor to the Internet – using a 800 bps modem and a bunch of phone extensions. Together with some equally enthusiastic friends, he even built text-based games on the network by downloading and compiling the code himself.

It was entirely a hobby with absolutely no profit. I had a duality in me: I like technology but also wanted to be creative.

But he wasn’t about technology for technology’s sake. Roland believes that engineering should be an enabler, a “lower layer” that can be applied to higher creative pursuits.

That aspiration – and his desire to remain in the United States – soon led him to pursue a Master’s degree at Ball State University via a scholarship where he did research on Internet technologies. That was even before TCP/IP became the dominant communications protocol on the Internet.

While Roland wanted to start his own business when he returned to Singapore in 1995, he found himself broke again and so began working as the CTO at Horizon, a company which was involved in setting up the entire Wide Area Network for Singapore’s town councils.

Roland once again got involved with computer games, serving as the president of a department that distributed boxed games for publishers like Blizzard Entertainment and Vivendi Universal Games.

The company soon went public in 2000 at the height of the Dot-com bubble, and Roland made some money from his stock options as a result, earning S$300,000 ($174,000) from liquidating his shares, which at one point were worth up to S$3 million before the Dot-com crash.

While friends told him that he could take it easy, get a $15,000 a month job, and live a comfortable life, it wasn’t what Roland had in mind.

I have an itchy backside. I bought a one-way ticket to China and camped there for a few years.

Seven-year itch

Roland plowed the money back into games distribution by starting The9 Interactive as part of his seven-year stint in the country. Doing business in China was an eye-opener, and Roland had to relook his assumptions about being an entrepreneur.

Startup founders from Singapore, he says, tend to get “creamed” in China because they are unable to step outside of their mental bounds. By that he meant that Singaporeans are too afraid to copy since they’re used to a Western mindset.

There’s this Chinese saying: everybody gets their first pot of gold by stealing. It’s either by piracy or by stealing from partners. Over in China, there’s really nothing wrong with taking somebody else’s things.

Roland does not view one culture as being superior or more ethical than the other. It’s just the way things are done.

“Look at Tencent. They started by doing a complete duplicate of Yahoo in China and yet they won the war. They made bad products for the first ten years, but that has changed,” he says.

Despite being a Singaporean unused to the ways of China, Roland did well enough to win The9 the rights to be an exclusive licensee for World of Warcraft in the country – where it became the country’s largest grossing title – as well as in Taiwan.

In what was becoming a recurring pattern, he cashed out, resigned from the company, and returned to Singapore to start IAHGames, his current venture.

The unfortunate decision to experiment

IAHGames, in many ways, is an expression of Roland’s entrepreneurial DNA. Almost apologetically, he pointed out how the company has “unfortunately” adopted a culture of experimentation by bringing in original, less-established intellectual property with a higher chance of failure.

“Experimentation pays the highest price,” he says, bringing up the example of how they published FIFA Online 2 for the region and built its community up to close to a million, only to eventually lose the license for the next iteration of the game to a competitor. Despite IAHGames bearing all the risks, they did not get to reap the full rewards of distributing a mature brand.

The company has also been actively investing in original local content, supporting game developers through the Singapore government’s Game Box initiative through mentoring and marketing.

But Roland does hope that the risk-taking culture will pay off in the long run. With many game publishers in the region struggling as PC games’ revenue are slowing in growth, IAHGames has thought about how to capture the burgeoning market of casual mobile gamers.

The last few years have been rough for IAHGames, which struggled after a botched partnership with Taiwanese firm GigaMedia in 2009. The company became a majority owner after buying out some of the IAHGames shareholders, but struggled to deliver on what was promised. In the end, Roland and several other long-time IAHGames employees had to fork out cash to buy back the shares.

Now back in control, he is steering the company towards the mobile and social games markets. While triple-A titles will continue to bring in the dough, IAHGames has begun distributing lesser-known indie titles with the potential to become breakout hits, like Conquest Age, a free-to-play fantasy RPG, and Spirit Horizon, a fantasy match-three puzzle game, both developed by Singapore-based developer Daylight Studios.

Besides looking more closely at mobile games, social is big on their agenda. They have partnered with local company Yuuzoo to create a social network for gamers that is reminiscent of Steam. The networks also serves as a distribution channel for IAHGames’ roster of titles.

Yuuzoo announced in May this year that it is acquiring IAHGames in a deal whereby the game distributor’s shareholders will receive a mixture of cash and shares of an undisclosed sum in the acquiring entity.

With a stake in the local developer community now, Roland hopes to see more game creators step outside their own biases and get immersed in the global market – the same way he penetrated China while doing business there.

Local developers tend to develop and think like Singaporeans. But there are vast differences in how gamers behave, and that affects the way games are developed. That’s why locals need to expose themselves more, and I’m starting to see that happen.

(Editing by Mary-Anne Lee, Josh Horwitz, and Steven Millward)

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