Agate seeks $10m power-up for game dev expansion

Valthirian Arc: Hero School Story is one of Agate’s most popular titles. / Photo credit: Agate

Agate International, one of Indonesia’s largest game developers, is seeking to raise around US$10 million to support its expansion plans. This includes potential acquisitions of other game studios and companies, co-founder and CEO Shieny Aprilia tells Tech in Asia in an interview.

The company plans to secure US$2 million through convertible notes this year, while it may potentially raise US$8 million in a series B round in 2025 or 2026. The series B funding amount may vary based on the company’s needs at the time, Aprilia adds. The notes could be converted into equity once the company closes the series B round.

The startup will use the new funds to launch a game publishing unit in Indonesia to develop new titles. It hopes to seize the opportunity created by the new presidential regulation issued in February, which is aimed at accelerating the growth of the local game industry.

Founded in 2009, Agate has released over 250 titles across various platforms such as Android, iOS, PlayStation, Nintendo, Xbox, and Steam. Its games have recorded over 10 million downloads and more than 200,000 daily active users.

In addition to game development, Agate provides services such as game art creation and game porting for foreign developers. The company also creates gamified marketing and learning materials for corporate clients such as Microsoft, Samsung, Coca Cola, Bank Negara Indonesia, and Djarum.

Agate plans to acquire a payment gateway provider to make it easier for Indonesian gamers to pay for their purchases. Beyond Indonesia, the company is looking to hire representatives in South Korea and Japan to obtain more orders from game developers in both countries.

According to Aprilia, the startup has maintained EBITDA profitability since 2022, and it anticipates doubling its profits this year compared to 2023.

Agate co-founder and CEO Shieny Aprilia/Photo credit: Agate

The company aims to achieve at least 10% revenue growth this year, following an average annual growth rate of 42% between 2021 and 2023. Aprilia says that its new business initiatives are expected to boost gross profit by 50% over the next three years.

With the new regulation, Indonesia plans to help local game developers get access to funding sources, provide tax incentives, and require foreign game publishers to establish local entities or cooperate with local partners in order to sell titles in the country.

The government will also allow highly skilled overseas talents to work in Indonesia to pave the way for knowledge-sharing with their local counterparts.

These new policies are expected to boost the market share of games by local developers to 70% from less than 1% currently, according to the government. In 2022, the Indonesian video game industry generated around 25 trillion rupiah (US$1.6 billion) of revenue, with local developers accounting for only 0.5% of that figure.