Back in February, the news that mobile games developer Niantic had raised a $5 million expanded seed funding round didn’t turn too many heads.
Now Niantic’s name is top of the charts and the headlines, with its blockbuster Pokémon Go app taking less than a week to become more popular than Tinder and transforming real-world locations like Central Park into dystopian congregations of ardent Pokémon trainers staring at their smartphones.
David Jones saw Niantic’s potential early on.
Jones is the former CEO of Havas and founder of You & Mr Jones, a self-described “brand tech” network that aims to take on the big ad agency networks with a collection of creative, media, and tech businesses that aim to help marketers do their jobs faster and cheaper.
Founded last year with $350 million in funding, You & Mr Jones has also invested in companies such as crowdsourcing company Mofilm and viral news site Mashable and works with clients including Unilever, Samsung, Airbnb, Accenture, and Netflix.
Niantic CEO John Hanke is a “rock star”
Jones knew Niantic’s vice president of strategic partnerships, Mathieu de Fayet, from back in his Google days. Fayet joined Google in 2008 as an agency development lead, went on to become head of creative partnerships and operations and global operations, before moving to head of partnerships at Niantic Labs in 2012.
Niantic was founded after Google acquired founder John Hanke’s former company Keyhole in 2004. Keyhole relaunched as Google Earth, which Hanke became responsible for alongside its Maps, Street View, and Local products.
Niantic Labs was formed within Google in 2011, described on Hanke’s LinkedIn pages as “experimenting at [the] intersection of mobility, real world, and the internet.”
Google ended up spinning the company out in October 2015 after the huge success of its Ingress massive multiplayer online game, which gained a cult following amongst fans. Niantic raised $30 million from Google, Nintendo, and the Pokémon Company to carry on alone.
After several phone calls with the team, Jones met Hanke around 12 months ago and the deal was closed around three months later, with You & Mr Jones joining the $5 million round alongside Alsop Louie, Fuji Television, Lucas Nealan, and Cyan and Scott Banister.
The San Francisco-based company ticked all the boxes You & Mr Jones looks to fill before investing: A business that’s in a hot space; the right people; a business that clients will want to use; and that the financials make sense, Jones said.
He added: “We are passionate believers in the AR, VR, and AI space and at a big picture level we are trying to build a company to enable brands to do marketing better, faster, and cheaper using tech. The founder [of Niantic] is a genius by the name of John Hanke … [who] is a genuine rockstar and mega talent from the tech world … the beta demo already showed how people playing the game in the city would pursue a different walk to work [in order to keep exploring the game] — we passionately believed this was going to be big, which was why we invested.”
Brands and Pokémon Go?
Pokémon Go, a game that lets users catch, train, and battle the cartoon creatures in real world environments using their mobile phones, doesn’t have any paid-for advertising options for marketers yet.
Jones — who, incidentally, has only collected around fix or six Pokémon himself so far — hints that is set to change.
“It’s premature to announce, but there are already some really cool things in the pipeline,” Jones said.
He pointed to how real-world retail stores have already become unofficial PokéStops and Pokémon Gyms. Some businesses are even using the presence of rare Pokémon on their premises as a tactic to get customers inside.
Jones said: “You can understand how anyone with anything to do with retail and location has that ability to get their brands to tie in. Real world food shops could have virtual berries; real-world pharmacies could have cures; sports stores, gyms, there are so many different things you can do. The potential is enormous.”
As TechCrunch pointed out, with its Ingress game, Niantic sold promoted in-game locations with brands including Bank of Tokyo Mitsubishi UFJ, Zipcar, AXA, and Circle K.As Pokémon Go continues to climb up the charts, it’s not hard to imagine it appearing on many of You & Mr Jones’ clients’ media plans.
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