Q&A: Accel’s Rich Wong on the Firm’s Big Bet With Angry Birds

Rich Wong of Accel Partners is more or less a fixture in mobile venture investing. While seeing Admob through to its $750 million sale to Google, he’s also made a number of notable investments in companies like Getjar, Mopub and 3LM, which was acquired before launch by Motorola.

His latest investment was with Angry Birds-maker Rovio, which attracted a $42 million Series A investment, after its title became the little-physics-game-that-could with nearly 100 million downloads.

A number of top-tier VCs like Sequoia and Andreessen Horowitz have gone in on mobile gaming in the last few months. But it seems like you really held out for the crown jewels with Rovio.

Well, I’m just a VC. I’ve known Peter Vesterbacka for nine years. And I told him, I have to work with you on this one. We’ve been waiting essentially a decade for the market to look like this. Is this a mass market idea? Can it scale?

When I saw all of my five-year-old nieces and nephews playing this game every day, I just knew that I really, really wanted to be part of this company. But Peter would say that they were just doing fine and that they didn’t need venture capital.

The story goes back to last summer when he first started at Rovio. Every four to five months, Peter and I would get together at different mobile conferences.When I saw him last summer, I asked him what he was up to. What’s going on? What’s hot? And he said he was going to do this thing called Angry Birds.

I knew it was at the top of the rankings, but I wondered, could it stay up there? It wasn’t obvious to me that it was going to be what it is today. It was still the very early days. So we stayed in touch, and then by mid-summer or so, I began to think — wow, it’s really taking off. They’re really continuing to stay at the top of the leaderboards.

I started to call them often and ask: Do you want to work together? Ultimately, it took nine months from summer until March to convince them. It’s great. If it takes that long, it’s still worth it.

Were you talking to anyone else?

I did talk to a few others. But there really aren’t others like this one. Obviously, I’m biased. But if you think about it — 200 million minutes of usage a day. 40 million monthly actives. This just doesn’t happen. It just doesn’t happen that a game that my 5-year-old loves is the same game my 40-year-old brother loves.

We’ve got a long ways to go. There are a lot of things that could not go right, but it’s a special company.

Is the valuation you went in on essentially a bet on Angry Birds alone? Or is it on the assumption that Rovio can successfully launch new IP? Basically, are you betting that they can not only create a Mario Bros.-style franchise, but a Zelda one too?

Angry Birds already has multiple flavors. There’s Seasons, Rio and other derivatives. Obviously, there is other physics-related gameplay they could do. But there is so much they can do with the content and characters they already have. They’ve found a way to keep it going in a way that very few other people have.

That’s thing one. Thing two is — remember JAMDAT? If that company was worth $680 million and they were making games on the Motorola Razr, which was state of the art at that time, and the market was an order of magnitude smaller than it is today, I think Rovio could be a very valuable company. Even with that valuation, you wouldn’t have to count on anything that’s not completely in line of sight to get a financial return.