Skillz
Architects of Dreams for Developers, Catalyst of Wins for Players

Over a decade ago, Skillz (NYSE:SKLZ) founded a whole new category: skill-based competition in mobile games. The Skillz platform equips game developers with the tools to effectively monetize their content, fostering the growth of multi-million dollar franchises while integrating fair and social competition within their mobile games. Simultaneously, it orchestrates billions of casual mobile gaming tournaments for players and disburses millions of dollars in tangible prizes monthly.

Since its inception, Skillz has enabled over 14,000 game developers to launch game integrations, resulting in the accumulation of billions of dollars in tournament entry fees and the attraction of millions of active players each month. As a result, the mobile game industry has embraced a whole new gameplay experience, one that gives players the thrill of competition and allows them to hone their skills to reap real world prizes as a reward for their effort.

With skill-based, real-money competition in mobile gaming rapidly growing, Skillz is at an interesting and important juncture. It now must define – and in some cases defend – the category it built to ensure fair competition is thriving in the palm of players’ hands.

Partner in Progress: Nurturing Game Development Success

“We love gaming and have a deep respect for game creators. We are dedicated to empowering developers so they can build thriving businesses through their craft in a way that delights players,” says Andrew Paradise, CEO of Skillz.

Skillz created a unique opportunity for small and mid-size game developers who need to effectively monetize their games. The company provides developers with a holistic platform, enabling them to channel their energies toward bringing great games to life. The cornerstone is its gaming software development kit (SDK), which equips developers with the essential tools and game monetization strategies they need to turn craft into currency. The Skillz SDK levels the playing field so even small studios stand the chance of success. Case in point - game developers such as Big Run Studios and Tether Studios are long-time Skillz development partners who built their business on the Skillz competition platform.

However, Skillz’s true charm lies in its ability to blend realworld rewards with the thrill of competitive gameplay. By doing so, Skillz created a competition-based monetization approach for revenue generation as opposed to traditional ad-based or in-app purchase models. This business model puts the player experience at the core. Skillz recently updated its revenue-sharing model, so game developers can enjoy revenue returns from 50 to 94 percent based on the player traffic their game generates.

Acknowledging that engaging players are key to driving success, the platform offers a comprehensive live ops and marketing support system, encompassing 24/7 player assistance, live events, and engaging seasonal leagues.

Developers can tap into its vast player network, connect with millions of potential players, and cultivate thriving communities around their games. The company also addresses a crucial aspect of mobile game monetization that is often overlooked—the complex landscape of taxation. Skillz simplifies the intricacies, ensuring that convoluted tax processes do not burden developers.

Nurturing Champions of Tomorrow

"Skillz constantly innovates to elevate the player experience by introducing exciting features that bring the thrill of competition to everyone while fostering meaningful social connections,” says Paradise.

The platform’s gripping and rewarding nature leaves players to relentlessly pursue their next win. With its patented matchmaking technology, Skillz ensures players compete against other real people based on their skill in a given game. This, coupled with anti-fraud systems and 24/7 player support are critical components of ensuring fairness at every interaction.

Offering hundreds of games across major genres that cater to all player’s preferences and skills, players are enabled to become champions – and some VIP players on the platform have finetuned their skills enough in a game to realize profitability of thousands and even millions of dollars.

We love gaming and have a deep respect for game creators. We are dedicated to empowering developers so they can build thriving businesses through their craft in a way that delights players,” says Andrew Paradise, CEO of Skillz

When players immerse themselves in the Skillz experience, they unlock many engaging features, from captivating leagues and live events to climbing up the leaderboard. In each level gained, their gameplay evolves, setting the stage for an adrenaline-fueled journey to leveling up. The company rewards dedication and excellence by offering players millions of dollars in real-world prizes each month or by granting them Ticketz—a currency that can be redeemed for exciting prizes in the Skillz store - from bonus cash to luxury watches and cars.

But the thrill of competition, and achieving a win, extends far beyond the gameplay experience. Skillz found that players enjoy sharing how the ability to compete in casual tournaments has both connected them to a social community as well as helped them face – and conquer – real-life challenges. This includes a longtime Skillz player who has been playing Blackout Bingo on the platform to overcome the hardship of dealing with her Mom’s cancer.

The Silent Intruders: Addressing AI Bots in Gaming

“Competition cannot exist without fairness. As a category creator and leader, it’s our duty to create a future where competition is always fair for all players,” says Paradise.

Consider the current state of things. Skill-based mobile games are part of an industry that could reach a staggering USD 138 billion by 2025, with global mobile game market revenue surging to USD 113 billion by 2024. Of this, paid competitive gaming is anticipated to constitute 14 percent, translating to a remarkable USD 16 billion globally.

However, the use of bots in skill-based mobile games is a significant challenge facing the industry. AI has found its way into mobile gaming, particularly within the skill-based, real-money gaming sector. Bots are one of the most pernicious issues facing this industry. AI can trick players into believing they are competing against real people, effectively defrauding them of their hard-earned money. AI can craft an experience that feels competitive by offering variations in gameplay, leading players to believe they have the upper hand. In some cases, AI may even allow players to win occasionally to fuel the psychology of progress and competitiveness.

"Competition cannot exist without fairness. As a category creator and leader, it’s our duty to create a future where competition is always fair for all players,” says Paradise"

The dishonesty in deploying bots is multifaceted. When bots replace human competitors, fairness vanishes, and companies pocket prize money intended for real players. Using bots is often justified by the need for players to find opponents. A true competition game needs several players available at any given time to enable quick matching for a seamless gaming experience. If there are not enough similarly-skilled players available, players may have a sub-optimal experience – longer wait times to be matched with an opponent or no matches available when they want to play. Creating bots to fill player availability gaps is a tempting solution, as the technological task of programming an AI opponent that mimics human behavior is relatively straightforward. Worse yet, unsuspecting players engaged in skill-based gameplay rarely anticipate facing bots, which can be manipulated to win or lose.

Bots corrode the essence of fair competition, matching players with fraudulent counterparts masquerading as real competitors. This intrusion of AI undermines the integrity of skill-based games and causes players to lose their earnings, all while believing they are competing against genuine opponents.

Skillz is committed to bringing to light the massive impact of bots in the skill-based competition industry, as evidenced by recent developments in ongoing litigation against one of its competitors involving copyright and patent infringement.

Leading the Future of Competitive Gaming

“We are on a path to define the future of competition and create more value for the world we serve,” says Paradise.

Looking ahead, Skillz is laser-focused on profitable growth. This includes delivering an ever-expanding competition experience and building a thriving community on its platform. Furthermore, Skillz is continuing to invest in strategic partnerships. With partners such as the NFL and UFC under its belt, Skillz is also setting its sights on new distribution partners to enable people to enjoy competition wherever they are.

For developers, Skillz remains passionately committed to their success. Discovering and monetizing new content plays an important part of that commitment. Recently, Skillz announced the sponsorship of two new mobile game categories in the winter 2023 Game Developer World Championship with prizes including a Skillz publishing deal guaranteeing a minimum User Acquisition (UA) spend and Skillz team support for the winners.

What does the future hold for Skillz? In short, continuing to define the standards of the category it built, while delivering the best experiences for developers and players alike, rooted in the power of fun – and fair – competition.