How Supercell Uses Autonomy, Trust, and AI to Win (Full Transcript)

[00:00:00] Speaker 1: Okay,

[00:00:37] Speaker 2: Ilka, it's so great to have you here today. And to set a bit of context, Ilka founded Supercell in 2010 with a mission to create games that people play for years and remember forever. Since then, the team has launched so many iconic titles, such as Clash of Clans, Hay Day, and Boom Beach. But I want to start off with something that you've said. You've said that it's never been so hard to launch successful new games. And in 2024, you even mentioned that about 60% of mobile playtime went to titles that were at least six years old. Can you share with us a little bit on how the Cell approach at Supercell helps you stay competitive in this market? And maybe you can share a little bit about the founding story of the Cell approach to team building.

[00:01:48] Speaker 3: Sure. So first of all, thanks for having me. I've been a huge fan of 11 Labs and Matti as a founder for a long time, so it's a big honor to be here. So the story behind the Cell approach is actually relatively simple. So when we founded Supercell, there were six of us co-founders, and each of us had been in the games business by that time for roughly a decade or so. And we had been lucky enough to be part of some quite successful companies. And in these companies, this same thing would repeat over and over again, which was what the more successful the company became, somehow the creators, the creative people, these game designers, people who program the games, and people who do art, somehow these creative game teams, they kind of lost control. And business people, I guess like myself, somehow would come in control and would start to dictate to those teams what to do. And then we had this, and it's sort of like, it results in a very process-driven, optimization-driven culture, and maybe it's really hard to see how outlier hits would come from that type of an environment. And then we had this idea that what would happen if you would give the complete control of the game to the game teams themselves? And what would happen if you could flip the organizational chart upside down? So actually, who ultimately owns the vision for the game and owns the entire game is actually the game team, and not to say the leadership team of the company. And then somebody said that, hey, this is a pretty radical approach, and they probably shouldn't even call these game teams, like teams, let's call them selves. And then somebody asked the follow-on question, which was that, well, what should we then call the entire company? And that's then how the name Supercell came about.

[00:03:46] Speaker 2: Amazing. And building on the philosophy of giving more agency to your teams, you have also said actually that you are the least powerful CEO in the world. How do you actually see what great leadership looks like today? And what is your top three responsibilities, being the least powerful CEO in the world?

[00:04:12] Speaker 3: Well, at least in our culture, the most important element is trust. So basically, my and our goal is to hire the best possible people in the world. Then out of those people, we try to form the best possible teams. And then we also try to create a culture where those teams can have the biggest possible impact. So I see culture as this kind of fuel that you pour on creativity, and then there's a massive fire, in the best case, in a positive way. So that's how I see my and our leadership team's responsibilities. We are not there to build games or decide what type of games to build or any of that stuff. We are there to create conditions where those games can be born. So that is really a leading idea. The logic is that if you imagine a company or a company like Supercell, where these individual cells have full autonomy, they are completely independent with responsibility, of course. In theory, there should be two really great things that follow from that logic. The first one is that because these cells can decide on their own, so they don't need to go to the upper level of management to get approvals for anything, they can move really, really fast. And the second point is that because these cells can make decisions on their own, that means that the decisions are made as close to the user or to the player and as close to the product or to the game as possible, in fear that would result in much higher quality decisions. So those are the basic principles and values that they've built the company around.

[00:06:03] Speaker 2: And when these teams are building these companies or games, how does the development process look like? And is there a big variance between cells once they got in the green light?

[00:06:15] Speaker 3: Well, how we like to think about it is that each cell has to figure out their own path to what a great game looks and feels like. And one of our biggest advantages is that we sort of tolerate the differences between the cells. And one of our biggest sources of strength, I feel, is the diversity between the ways of working of these sort of cells. So basically you could, especially on the new game side where we try to innovate on new games, you could think Supercell as almost like a venture capitalist that kind of makes bets and investments to these new game teams. And in a venture capitalist portfolio, it's not that one portfolio company is similar to the next one. It's kind of different. And that sort of is the whole point.

[00:07:03] Speaker 2: Amazing. And some of you in here might actually be aware of the Supercell champagne approach. But for those of you who are unaware, Ilkka, could you tell us what is the champagne approach to failure and mistakes at Supercell and why is it so important to your success?

[00:07:22] Speaker 3: So basically the goal here in our culture is that one of our core values is ambition, meaning that we always try to shoot for the moon, like whatever we do, we always try to shoot for the moon. And we believe that, at least in our business, the only way to make an outlier hit is to build something that doesn't exist yet. And then if you're trying to build something that doesn't exist yet, then by definition you need to take a lot of risk. And by definition, a lot of things will fail. And we actually see failure as a kind of a necessary part of a creative process. And most of the stuff that you're going to do, it's going to fail and it should fail. And we oftentimes say that if there would be a year and every single game project that we do succeeds, then we should be really worried for two reasons. First, maybe our bar isn't high enough. Actually, we are not trying to shoot for the moon. And maybe we aren't taking enough risks. So therefore, we try to create this culture that really encourages risk-taking and can celebrate failures. And we are not trying to pretend that failing is fun. Of course it's not. But what we think is worth celebrating are those learnings that come from the failures. So to cut the long story short, we have this tradition which started 15 years ago. If we kill a game project, so this failed game, what happens is that the game team, the people who built the game, they get up on the stage. And it used to be a very small stage when we were like 20 people. Now it's much bigger because we are 900 people, but it's still the same thing. They get up on the stage and they tell to everybody what they learned through that failure. And then as a company, we offer champagne and we toast to the learnings from that failure.

[00:09:20] Speaker 2: And what are the explicit kill or scale criteria in this process?

[00:09:26] Speaker 3: Well actually, even that is up to the teams. So again, as I said, they completely own it and they are in control. So when they kill a game project, an extremely important part of that thinking is that it's not me or anybody from a leadership team. It's not anyone from the outside of the game team who can make that call. It's the team and ultimately the lead of the team who can make that call, which I believe makes it a lot easier actually to make those decisions. Basically how a decision is made, basically ultimately we look at maybe two things. First is of course the obvious one, the data. We look at the game metrics and mostly we look at retention and engagement metrics. Things like day one retention, day 30 retention, and even longer term retention metrics. Those are the most important things. Of course we do look at monetization, but for us that's the secondary metric. We believe that if you are able to create something that is fun for people to play and that means that they come and return to the game day after day, over time then they can figure out how to monetize that experience. But you can't do it the other way around. If you don't have a great product that people love and they are proud of playing and talking about then you have a problem. And if that's the case then the game should be killed.

[00:10:53] Speaker 2: And for those of you who are not aware, Supercell absolutely crushed it last year. If you see the numbers from last year, it's absolutely fantastic. So big congratulations on that. A big reason for that has also been your huge success in creating communities. So once these titles have been launched and created, how do you go about the community building and getting that distribution?

[00:11:25] Speaker 3: First of all, it all starts from building a great product. It's sort of obvious, but we always try to focus on that. Ultimately, I shouldn't say that's the only thing that counts, but that of course is the most important thing. But once you have a great product that actually is worth talking about, then actually the great thing about today's App Store ecosystem is that people actually do talk about these games if they are proud of playing them. And I guess something that makes Supercell quite different among mobile games companies is that we are way less reliant on user acquisition. And the reason why we are way less reliant on it is because we believe that we just build these great games and people talk about it, and that's how they become these viral phenomena. And in our approach to community, we try to be as open, as transparent. Of course, every once in a while we screw up, we make mistakes. And if we do, then we try to admit them and try to correct them. We try to listen to the community around us, which by the way, sometimes is extremely hard. Because imagine a game and it has, say, 100 million people play it every single month. They play with one single game. Well, there's a lot of different opinions among those 100 million passionate gamers. And there are these hardcore fans and gamers who spend lots of time playing the game and they know every single detail of the game even better than we do. And then there's more with casual players who maybe have 5 to 10 minutes per day to play it and they don't maybe take it as seriously and they're not as competitive. But then how do you balance between all these different requirements? And once it's a really, really difficult process, I think.

[00:13:21] Speaker 2: Yeah, I can imagine. And going into a little bit on AI, we have to dive into AI. We're after all at an AI summit at a high level. How is AI influencing the development process?

[00:13:36] Speaker 3: Well, there's two ways to think about it and I think both are true. The obvious one is that it just makes everything faster. We can make better quality products faster than ever before. And I see this accelerating a lot. And the way we're going to think about AI is that AI gives our creative developers superpowers that they didn't have before this age. And we very much see still the human creator, the creativity in the front and center. But then again, as I said, AI just enables them to do more and better for the players. But that's sort of the obvious stuff. The other side of the same coin, which I'm at least as excited about, if not more, is what type of new gameplay might AI enable our developers to develop for the players? What type of new games could we invent today that were not possible even three or four years ago? And you know, in a funny way, this sort of time reminds me actually of the year 2012. I remember it was a game developers conference in San Francisco and Supercell had developed a bunch of games. And two of those games were Hay Day and Clash of Clans. And I had those games, I think, on my iPad. And I went to San Francisco and I wanted to show those games around, those prototypes, to some very senior and experienced and very successful people in the industry. And a typical case would be that I take my iPad, I launch Clash of Clans on it, I hand over the iPad to the other person and the other person takes it and plays for a little while, maybe 20, 30, 40 seconds, hands over the iPad back and asks, so I don't understand, why would anybody play this game? And I just remember how crushed I was because I really looked up to these people. And then since those days, Clash alone has generated way, way more than 10 billion dollars in its lifetime, more than a billion installs and all that, and still an extremely successful game. And I've been reflecting on those moments and why didn't these extremely successful people in games, why didn't they see it coming? And I think the answer was that it was such a different thing. I mean, they couldn't understand. First of all, why would you give out these games for free? It doesn't make any sense. And then the UI is different and it's a different type of a game. And they even questioned whether that's a real game. I can't remember how many times I heard this term, you guys aren't developing real games, because real games are played on PC or consoles and et cetera. So that was 2012, and of course because of this type of attitude, it enabled companies like King and us and many others to emerge and become quite big. So that was 2012. Fast forward to today, my biggest fear is that today Supercell is one of these bigger successful companies, like 290 million people play our games every month and so forth. And my biggest fear is that now GDC, Game Developers Conference, is again approaching. We go there in March, and then this maybe somewhat younger person comes in with some kind of a device, whatever the device is, and says, hey, do you want to take a look at the game that I did? And it's some kind of AI-native game. It's some kind of transformative experience, something that we've never seen before. And then we would ask, hey, I don't understand, why would anybody play this game? It doesn't even feel like a real game. And that's something that I don't know if it keeps me up at night, but we definitely talk about it a lot at the company, and therefore we've, for example, founded what we call AI Labs, which we have in Tokyo and San Francisco and Helsinki, and we are really trying to invite also other people to come in. We are welcoming them inside to Supercell and tell them, hey, disrupt us. Disrupt the way we think about games.

[00:17:59] Speaker 2: That's super interesting. And you also mentioned something very interesting a few minutes ago on that your creative teams can get superpowers with AI. What comes to mind when you think about that? Could you share a few examples of where you see your teams are having a bigger impact with AI in the creative process?

[00:18:20] Speaker 3: Well, a few examples come to mind immediately. The first one is that I was talking about the speed of iteration. So if you think about before AI, you had an idea, and then you somehow had to either create some sort of a prototype. You have to somehow visualize your idea, for example, and hopefully there's something to play. And from that first idea to actually having something on device or something, it probably would take you at least a few weeks, even in the best case. But now that same time can be literally like hours. And what that means is that you can like, you know, that's what I mean by that boost creativity, because you could try out like so many different things so quickly. And what's best is that you can actually try those your ideas out, your real players, real human beings, and get their feedback. And I think it relates to like, you know, obviously it relates to visuals, audio, as you guys well know. But even like, you know, just the entire playable game prototypes. And I think, you know, thanks to that. And also the best thing is that one single person can actually do all of those things. So previously, like, I guess a minimum size of a team would be that at least you would have an engineer, an artist, at least two people. But oftentimes, say, a designer and maybe have a client engineer, server engineer, et cetera, et cetera. And for anything to happen, like, you know, those, say, three to four people need to agree on the idea. And, you know, I heard a lot of complaints about, for example, from, say, designers or artists. Oh, I tried to convince that client engineer to do this, but, you know, but she wouldn't just do it. And there's a lot of arguments, et cetera. And all of that makes the iterations slower. But now what if it's just one person? And who just, you know, tells the AI, like, what to build. So I feel, you know, we'll see a lot of great gains just because of this much, much faster iteration cycles.

[00:20:30] Speaker 2: Yeah. And fast forward, let's say, like, five years from now, what do you think the future of gaming will look like? And maybe even entertainment in general.

[00:20:42] Speaker 3: It's a dangerous question, you know. I get a lot of invites to, or at least used to get a lot of invites to these panel discussions where the topic is future of games. And I always, like, decline them all because it's impossible to say. And my sort of, like, how I think about it is that, you know, no one knows. I mean, games is, it's extremely hard to forecast. I would argue it's impossible. And the bigger is the hit game, the harder. I mean, say, think about something like, say, Minecraft, which I'm sure is familiar to many in the audience. Like, I mean, who could have imagined, like, what it would become? And, of course, the same is very much true about the Supercell hit games. And that Clash of Clans example in San Francisco 2012. I mean, even the brightest people in our industry, people had seen it all. They couldn't see it coming. So I guess a short and honest answer is that I have no idea. But what I've tried to do is what I can control, which is I try to make sure that we have the very best people, the very best teams working in a culture, which, you know, somehow helps them to figure that out. And somebody has sometimes said that hit games are almost like accidents. And what kind of a leadership of a game company can do is that you want to, like, create the conditions which can maximize the probability for those accidents to happen.

[00:22:03] Speaker 2: And as content is constantly exploding, what do you think is the hardest to maintain? Trust, taste, or attention?

[00:22:17] Speaker 3: What a fantastic question. Doesn't have an easy answer. I mean, lots of people probably don't yet think this way, but I actually think that probably over the years, like, AI can also develop, like, some sort of taste. I'm quite sure that it'll happen, given how fast things are, like, moving forward. So it's not... So I probably would say trust, because, I mean, that ultimately, like, that's probably, like, the most important thing. And it's also very binary in nature. You either have it or you don't.

[00:22:58] Speaker 2: Yeah, yeah, totally. And in an AI-enabled organization like Supercell, how often do you think that leaders should be revisiting team structure or maybe even decision-making?

[00:23:12] Speaker 3: Well, given, like, how fast things are moving, how fast things are changing, I would say that you should be revisiting and questioning and challenging it, like, all the time.

[00:23:24] Speaker 2: Great. And as a very final last question, Ilka, as a very busy CEO, when do you actually find time to play these games yourself? And I have to ask, which one is your favorite at the moment?

[00:23:39] Speaker 3: Well, I wish I had even more time, but obviously I play games, and, you know, obviously I play the Supercell games, and there's actually a lot to play, because we have, like, only five live games, but then at any given point of time, there's 10-plus games, like, in development, and, of course, those are the ones that I also was always very curious to play. Which one is my favorite out of those? I just can't say. It's almost the same as asking, like, who's your favorite child? So, you know, I just can't answer that. But, like, outside of the Supercell games, I actually tend to play a lot what my kids play, like, and that changes often, and their taste stays quickly, and what have we played recently? I mean, my son, for example, played Fortnite a lot, and actually now has just switched back to Rocket League, so we've played that quite a bit.

[00:24:39] Speaker 2: Nice, and have you, when you're playing Fortnite, have you experiencing the Eleven Labs speaking to Darth Vader mode agents?

[00:24:47] Speaker 3: Absolutely.

[00:24:49] Speaker 2: Great. Well, it's been great having you here, Elka. Such a pleasure, and thank you so much. Thank you very much.

[00:24:56] Speaker 1: ♪♪