Mike Sego on Monster Galaxy’s Monsterous Facebook Growth

[Mike Sego is CEO of social game and online community developer Gaia Online. Though the developer got off to a false start on Facebook with Ocean Party, Gaia entered the social games spotlight with its second Facebook game, Monster Galaxy. Launched in November 2010, the Pokemon-style adventure game now boasts 18 million monthly active users and frequently breaks 1 million in daily active users. The story below is an “as told by” monologue, drawn from a recent Inside Social Games interview with Sego.]

All my life I’ve been passionate about games — my parents used to call me the “Game Boy” because I’d be hunched over in a corner playing my Game-Boy handheld console for hours on end. I distinctly remember the moment I decided to study Computer Science. It happened when I first learned that the maximum integer you can hold with 16 bits is 65535. I instantly made the connection that that’s the most experience you can earn in Dragon Warrior. From then on, I knew I wanted to build games. But enough about me — this is a story about Gaia, and our path to making Monster Galaxy.

Gaia Online started back in 2003 as a project born from passion. A group of artists and their engineer friend had the idea to combine an internet forum with gameplay and create a place where simply hanging out – browsing and posting — would earn you virtual currency to help advance your status. The site quickly blossomed into a large community of anime and video game fans, and over time broadened even more.

What transformed Gaia Online from being a project among friends to a successful business was the virtual goods revenue model. The team was running out of money, so they put up a link asking users to donate. In order to thank everyone who donated, the team gave donors a virtual item for their avatar as a gift, a golden halo. The next day, donations tripled because people were so excited about the virtual item. This system got formalized and refined over the years, and the team developed a deep understanding of virtual goods monetization.

In many ways, Gaia Interactive has always been a social gaming company, but well into 2009, we were operating pretty much independently from Facebook, doing everything ourselves on our own destination site. We built our own network, we built the games, we built the community and all the features, etc… Gaia Online was a superset of social networking and social gaming, and in trying to do everything ourselves, we were limited in how much we take on.

I joined the company in October of 2009 to help us pick a direction and figure out our next steps. My background had been in developing (fluff)Friends, one of the first successful Facebook games, so during my period of transition into the company, we took some steps towards exploring a Facebook gaming strategy. We decided to port one of Gaia’s games, an aquarium simulation, to Facebook and launched Ocean Party. The game’s potential was limited by being in such a crowded genre, but it was clear there was still an enormous and growing opportunity for games on Facebook. We strongly believed the team and the talent behind Gaia Online would be incredibly applicable to the Facebook platform, but needed to do something different than what everyone else was doing, something unique that few people could do really well.

So, the idea for Monster Galaxy didn’t come from just one place. It was a combination of three different things that came together around the same time.