Author | pinecone

Edit | Liu Jingfeng

Turkey, the meeting place of Eurasian civilizations with its own "Internet celebrity temperament", is becoming a new round of global popular travel destinations.

According to the Ministry of Culture and Tourism, the number of international tourists in the country reached a record 49.2 million in the first nine months of this year, and the number of Chinese tourists also climbed, with a year-on-year increase of 84% in the first nine months.

But the people who grew up on this land are now trying to leave by all means.

In the second half of this year, a poll conducted by the local Hisar Schools Humanities and Social Sciences Research Center in cooperation with KONDA showed that more than half of young Turks want to emigrate abroad.

JH, a Turkish girl who has been working in China for two years, shook her head and gave even more exaggerated figures, "Almost everyone around me wants to go." Under the high inflation, the Bosphorus is no longer very attractive to local young people, and even high-paid workers such as doctors and game development engineers have begun to look for work visa opportunities in European countries.

This is the last thing Turkish officials want to see.

Gaming is a proud industry in Turkey. Since 2016, in order to alleviate inflationary pressure, Turkey has begun to vigorously develop the game industry to go overseas. Under a series of industrial policies, nearly 1,000 game startups were once active in Turkey. The high density of industries and talents has promoted the emergence of Turkish games in the global market, and has also brought a ray of light to the country's economy.

Entering 2022, Turkey's inflation has climbed to a new high in more than 20 years, and the government has used its "old weapon" to increase policy incentives. Ali Elgin, chairman of the board of directors of the Turkish Game Developers Association, said with confidence, "As long as the state continues to provide support, the export value of the Turkish game industry is expected to reach 10 billion US dollars." ”

But in the blink of an eye, internal cracks have appeared, and a pessimistic mood and a sense of confusion about their own income have begun to pour into the hearts of practitioners.

In 2023, the match-3 game "Royal Match" will beat the ten-year revenue hegemon "Candy Crush" with a revenue of $20 billion, becoming the world's most profitable mobile casual game that year. Until now, Royal Match is still in the top three best-selling lists of casual games in the United States.

Royal Match。 Source: Dream Games official website

The team members of the Turkish start-up studio Dream Games, the developer behind the game, have tasted the fruits of victory for the second time.

Stretching the timeline back a little bit by two years, they have a successful track record with their former club, Peak Games.

Peak Games' match-3 games "Toy Blast" and "Toon Blast" series, and Gram Games' synthetic game "Merge Dragons" have all made it to the top of mobile games in Europe and the United States, and there must be a place for "Made in Turkey" among popular casual game IPs.

The opportunities for Turkish game practitioners can be traced back to 2016, when the Turkish government promulgated the National Digital Economy Strategy (hereinafter referred to as the "Digital Economy Strategy"), which derived a series of preferential policies for game practitioners, such as high tax breaks, cash support for R&D, and distribution subsidies for game companies and employees in designated technology parks.

According to a report by the Turkish Game Industry Association, in the year the policy was announced, the science parks in Istanbul, Ankara and Izmir attracted a large number of game entrepreneurs and companies, and nearly 200 game startups emerged across the country.

Entrepreneurs are focusing on the development of casual mobile games. According to Ealing, commercial director of Aptoide, an Android store in Europe and the United States, such considerations are closely related to the size of the studio.

In Turkey, most game studios are "small but beautiful", with about 30 people belonging to medium-sized companies, and in order to control labor costs, more companies are also willing to accept newcomers to the industry. "From the perspective of staffing and comprehensive capabilities, there is no more suitable choice than casual games."

What's more, casual games are more likely to gain capital favor.

For investors, it is very cost-effective to choose casual games - "low investment, high exit efficiency, and high odds of winning." Ozgur Karayalcin, vice president of the Turkish Game Developers Association, said that a small game start-up team in Turkey can produce 10 to 15 games a year, with an average of 1 to 2 games a month.

In 2018, American mobile game giant Zynga acquired Gram Games for $250 million in cash. In 2020, it acquired 80% of Peak Games and local studio Rolic for $1.8 billion and $160 million, respectively, expanding its casual game footprint.

In addition to the acquisitions of major overseas game companies, the scale of game financing led by local funds and CVCs has also increased. According to a report released by the Turkish Ministry of Investment at the end of 2023, the number of funds established locally has reached a record high in the past three years, and they are actively participating in seed rounds of gaming startups.

The highlight of the game industry once made the country's venture capital market prosperous for a while, and also made the morale of entrepreneurs high. A group of entrepreneurs began to form a steaming business, and between 2016 and 2023, the number of game studios in Turkey increased by 300%.

Statistics on the number of game studios in Turkey. Source: Invest in Türkiye

Ealing also mentioned that nearly one-third of the 10,000 game developers in Turkey are indie developers, who maintain a prolific creative state and hope to one day be in the industry spotlight.

But the reality is that the years are not always good, and the years of rapid development of the Turkish gaming industry are intertwined with long-standing economic problems such as the depreciation of the currency lira and inflation.

For a long time, Turkey has been highly dependent on foreign capital and large foreign debt to support its economic development, but once affected by external environmental shocks, the society often falls into the "curse" of inflation.

After Turkey's attempted coup in 2016 and growing tensions with the United States, the already precarious lira continued to fall, and an investment attractiveness report by The Economist also pointed out that Turkey's investment attractiveness ranking fell the most among countries.

When the digital economy strategy was released, the official pinned its hopes on game exports to promote foreign exchange income generation and activate the economy.

This is also the consensus of gamers. Many gaming companies are concerned that local advertisers will shrink their budgets due to inflation. ACCORDING TO DATA PROVIDED BY GIT, 87% OF TURKISH DEVELOPERS MONETIZE THROUGH IN-APP ADVERTISING, WHILE 28% OF GAMES HAVE IN-APP PURCHASES.

Secondly, the company also has no confidence in local users. Veloxia, an Istanbul-based game development company, has less than 1% of players in Turkey, "It's cheaper to attract users in Turkey, but users don't bring in revenue, and we would choose countries with higher GDP per capita." Founder Tugay Alyıldız said.

Veloxia team members at work. Source: Veloxia's official website

"To make money in overseas markets, you can hold more valuable euros or US dollars, and from the nature of hyper-casual games, the demand for localization is not high, and even if you do it in the international market, it will not increase the difficulty of development." Ealing added.

Therefore, in the international market, Turkish games have fought their way out. The depreciation of the lira has reduced the cost of local game development and made the price more competitive in the European and American markets; Publishers are willing to establish long-term cooperation with Turkish games because of their low cost and strong development capabilities, which is driving Turkish games to go global faster.

In the 11 years from 2013 to 2024, the lira fell by more than 90% against the US dollar, in stark contrast to the soaring foreign exchange revenue from games, which now accounts for about 95% of Turkey's gaming revenue. Local officials say that if the policy support is right, the export value of Turkey's game industry is expected to reach 10 billion US dollars in the future.

After 2018, Turkish President Recep Tayyip Erdogan vigorously pursued interest rate cuts and increased exports against the trend, and the country's inflation rate approached a record high of 80%.

Favorable policies for games going overseas have also continued to increase. It is understood that Turkish studios can get up to 50% of the iOS Store commission and 30% of the Google Play commission reimbursement for the game, with a ceiling of 100,000 euros.

Ealing also mentioned that if a game costs 1 million lire to buy, the subsidy can be up to 50% of the distribution cost, and the government will pay within six months.

Fearing that subsidies alone would not be able to sustain developers' enthusiasm, the government has also set up a series of game investment benefits: for example, investors do not have to pay any capital taxes; Allowing entrepreneurs to raise funds through equity crowdfunding, a gaming startup called Fernvaille has attracted the support of 600 investors, diversifying risk and attracting a wider range of funding.

According to a report released by Game Factory, an online game developer and incubator based in Istanbul, even in 2022, when inflation hit a record high, the Turkish gaming industry attracted $333 million in capital in the first half of the year, the highest in Europe.

In the early years, when the gaming industry was on a buying spree, there was a myth of wealth in the gaming industry among young Turks, and parents were keen to send their children to digital design or computer science, which meant booking high-paying jobs early.

Universities have become hotbeds of incubation games. Professors take students to develop games in a project-based format, even if they can only get a very low pay, and students are willing to invest more time and energy, watch the computer and read the code, and have the opportunity to go further afield.

Early Gram Games used to share employee activities on YouTube

When the number of start-up game studios in Istanbul grew exponentially, climbing to second place in Europe, the conflict between employers and employees escalated.

Rest Of World has reported that some game companies in Turkey are rolling up the "new speed", the founder hopes that the team will launch a casual game every week, and employees who do not meet the data standards can only earn a small fee, and dissatisfaction is starting to spread in the circle.

"Some entrepreneurs' short-term expectations, such as trying to become a unicorn within a year, are harmful," said Ismet Gökçen, a commercial partner at gaming venture capital firm Ludus Venture Studio, expressing concern about the industry's heat. He believes that it is important to have a balanced structure in the industry, "There should be start-ups that focus on developing long-lasting games, as in Finland." ”

Persistently high inflation has also made the average developer earn a lower salary with less purchasing power. In Istanbul, Ealing observed that a recent college graduate earned $1,000 a month in Istanbul, but $1,000 is not enough to live here.

JH lamented that every time he returned to China in the past two years, the price was "one price a day". "A cup of coffee in Turkey is worth 30 yuan now, which doesn't sound exaggerated in China, but in terms of Turkish income and purchasing power, the price of this cup of coffee is equivalent to 150 yuan."

Coffee shops on the streets of Istanbul Source: Courtesy of JH

A poll in Turkey this year showed that about 56% of young Turks would like to move abroad if given the opportunity. Some young people are keenly aware of the demand for IT talent from their next-door European neighbors, and the monthly salaries offered are quite attractive.

"I came from a language background, but many people around me will learn the code 'body', their purpose is to go abroad, and some positions can be paid twice as much in Europe." JH says. According to job postings on the job site Glassdoor, a junior development engineer in Turkey earns only 30 to 40 percent of what he earns in the UK.

Young people also feel that the workplace in Europe is more relaxed and employee benefits are better implemented. "In Turkey, although there are provisions for overtime pay, some small businesses are reluctant to enforce it."

Where to go? Germany has become a top destination for many. Bitkom, the German association for the information and communication industry, estimates that by 2040, there will be around 663,000 IT job openings in Germany, and there are currently 149,000 IT vacancies in the industry that remain unfilled.

Turks also have a special sense of belonging to Germany, and in the 60s and 70s of the last century, the West German government brought in a large number of Turkish foreign workers, and later allowed them to bring their families in, and a large number of Turks settled here. But this path is not as easy as imagined, JH revealed that Germany has now stepped up the review of work visas for Turks, "only for Turks." ”

Young people are fleeing Turkey, and the fortunes of the Turkish gaming industry are taking place, but it is impossible to ignore these surging dynamics.

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