PGDX: How The Philippines Became The Epicenter of Web3 Gaming Adoption

YGG co-founder Gabby Dizon joined Emfarsis Director Leah Callon-Butler for a fireside chat at PGDX to discuss how Philippines' web3 readiness played into YGG’s massive growth.

Having spent two decades in the web2 gaming industry, first working on the development of the first Filipino-produced PC game and then leading the early stages of the local mobile gaming boom, Yield Guild Games (YGG) co-founder Gabby Dizon was looking for gaming’s next big trend. Upon discovering CryptoKitties in 2018, and Axie Infinity soon after, Gabby became certain that the ability to program real value inside game economies using smart contracts, and the notion of providing gamers with true digital property rights, would change the gaming world forever.

In late 2020, when so many Filipino players were eager to explore Axie Infinity but unable to play due to the game’s high barriers to entry, Gabby and his co-founders Beryl Li and Owl of Moistness established YGG to provide the onboarding support and web3 education they needed.

YGG’s world-first approach to the web3 guild model caught the attention of top Venture Capitalists including Andreesen Horowitz (a16z) and YGG soon became the first Filipino-led startup to receive funding from them. YGG’s success paved the way for other Filipino-led web3 startups, such as BreederDAO, to access funding from international VCs too.

Today, YGG’s grassroots efforts have steered many thousands of people in the Philippines and all around the world to make their first steps into web3. At the recently concluded Philippine Game Development Expo (PGDX), Gabby joined Emfarsis Director Leah Callon-Butler for a fireside chat to talk about the Philippines’ position within the broader gaming industry. Gabby highlighted how a combination of factors such as Filipinos’ love of video games and social media, their ease in working online and remotely,  and their entrepreneurial spirit, led the Philippines to earn its reputation as the global epicenter of web3 gaming adoption.

The following is an excerpt from their fireside chat, where Gabby and Leah discussed how culture fits into web3, why the voices of Filipino gamers are becoming stronger, and how community is at the heart of making a blockchain project work.

Listen to the full recording on Facebook.

PGDX: Fireside with Gabby Dizon

Gabby (4:38:42): Having been in the game industry for over two decades, I've seen different trends come and go. Business model shifts. When we started over 20 years ago, everything was in boxed packages. Once we’d make a game, we’d press it into CDs, put it in a box, and then ship it to someone who could fulfill deliveries for Amazon. This is before digital downloads like Steam became super popular.

Then the industry went into downloadable, casual games on PC, and then mobile, free-to-play games. Each time this happens, it disrupts the industry. It creates new winners. I wanted us in the Philippines to be at the forefront of the next shift in the industry. When crypto and NFTs came around in 2017, I thought that that was what the next shift would be. But it took a while. 

CryptoKitties came out in 2017, Axie Infinity came out in 2018, and it wasn't until 2020 that Axie started becoming popular during the pandemic, especially here in the Philippines. I was part of the Axie community, and noticed that a lot of people were forming guilds to play this game. Through playing Axie, you could earn a crypto token called SLP, which could be converted to real money. A lot of people were forming guilds so that they can play together, earn some SLP and make money out of playing this game, and we were the first ones to really organize and scale the concept of these web3 gaming guilds. That was the start of YGG.

Leah (4:40:40): Gabby, you could have focused on building web3 games, but you've focused on guild applications. Why have you focused on that instead of the games themselves?

Gabby (4:40:49): At my former company, Altitude Games, we started creating blockchain games. During the pandemic, we saw a lot of activity coming from the Philippines. Philippine users have always had a voice in social networks and in gaming, but people usually see the Philippines as, “This is where I do my soft launch. It's very hard to monetize, so while I can use these users to test my product, they aren't very valuable.”

The difference in web3 is that the community is at the heart of making a blockchain project work. A lot of the communities that power these crypto networks are from the Philippines. For the first time, the voice of the Filipino user is a lot stronger than it used to be, especially since you need these community members to spread the word about what you're doing – use the product and then tell other people about it. Filipinos are always online, inherently viral, and have a lot of skills, especially in gaming, that we use to help make web3 games more popular, like being in eSports.

As you can see here, the Philippines has a super active eSports community. We have a lot of good content creators. This community has a voice that is magnified and a lot stronger in web3. These are the voices, these are the talents that we hone and cultivate to help make web3 games more popular.

Leah (4:42:26): Absolutely. I think YGG put the Philippines on the map, and it's now commonly referred to as the world epicenter of web3 gaming adoption, which is pretty incredible. Going back to the pandemic times, you mentioned that YGG was the first Pinoy-led crypto startup to be funded by a16z crypto. That is absolutely amazing. You raised money from a lot of world-leading VCs, like Bitkraft, Delphi Digital, a whole range of them. A lot of this you did without ever leaving the Philippines, which is basically unheard of. How the hell did you manage that?

Gabby (4:43:09): Yeah, it was very unusual at the time because most Silicon Valley VCs don't invest in companies outside of Silicon Valley. I think the nature of crypto, which is worldwide and remote, and how everyone was back at home during the pandemic changed everything. We were doing something remarkable, and it caught the eye of investors at a16z. We were referred by some of our earlier investors, and we were the first company out of the Philippines to receive investment from a16Z crypto. Now, there are other companies that have received investment since then, but we were able to pave the way for that.

You can listen to the full recording on Facebook.

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