How Netflix Inspired WinZO’s INR 1K Cr+ Gaming Empire

How surprised would you be if you were told that the gaming platform WinZO, which commands a network of 250 Mn users in India and Brazil, might never have existed if it were not for Netflix’s India entry in 2016 — as we learnt while speaking with the founder of WinZO, Paavan Nanda, about how it crossed the INR 1,000 Cr revenue mark in 5-6 years.

However, before he made inspiring revelations about the RMG giant’s journey since its inception in 2018, he said something a bit more interesting that stuck with us, and we thought of beginning our version of the WinZO story with just that.

Well, Nanda, the founder of Zostel and ZO Rooms, wasn’t specifically looking to build something in the gaming sector. It was only after his mind was boggled by the number of gamers the country was adding to its kitty every month that he decided to enter the uncharted territories of gaming in the world’s second most populous nation back then.

However, Nanda was sure about one thing — that his next product would be a consumer internet company only, as the country was experiencing a renaissance in the realm of the World Wide Web, but this time over smartphones and free internet.

A Quick Recap Of The Free Internet Era: Around 2016-17, content consumption in India began to surge at an exceptional pace, driven by Jio’s game-changing move to provide free internet access to a country of over 1.4 Bn people.

This was truly transformative, and people who previously did not have a computer or even a television were finally democratised by the internet, especially in tier II to tier V cities and towns. 

To mine the metaphorical golden goose of the new internet users being baptised by pocket-friendly, China-made, India-branded smartphones loaded with 3G and 4G data packs, big techs, including Google, Meta and TikTok, upped the ante to dominate the realms of video, short video, chat, and social media.

This was also the time when Netflix launched its streaming service in India on January 6, 2016. Close on the heels, Amazon launched Prime Video in July 2016.

Taking Cues From Netflix

While the content market was getting dense by the hour, Nanda saw a huge white space in gaming, despite the presence of thousands of games on Google Play and App Store.

“What was missing from the market was a gaming super app… and we were quick to figure it out. Think of it like how Netflix is for movies or how there are consolidated apps for videos or music. That kind of centralised platform didn’t exist for games or gamers back then. Therefore, we thought about creating a gaming super app just for that,” Nanda said.

Without any ado, the founder and his team started working on the concept, and, after countless brainstorming sessions, envisioned a platform where game developers could integrate their games. 

“Initially, our idea was as simple as requesting game studios to integrate with WinZO and let the company take care of the user acquisition and monetisation on their part. Simply put: we wanted the studios to focus on building games, while we wanted to handle distribution and revenue. From the user’s perspective, the goal was to make WinZO the go-to gaming platform, the Netflix of gaming.”

WinZO’s Early Originals

Like any other startup, WinZO had its share of learnings and pivots. The first few months were all about learning which direction to take until the team zeroed in on going ahead with a trivia app.

“I, along with my team, decided to create the mobile version of Kaun Banega Crorepati. The rules were simple — pay to get into the hot seat, and win money upon winning,” Nanda said.

The team gradually expanded to include more titles. As the game library grew, so did user feedback and the number of requests. This user engagement eventually led to how we know WinZO today.

For context: Unlike rummy or fantasy sports companies — models that were already well-established by 2017 or 2018, with players like Dream11 and RummyCircle, WinZO took the road less travelled with casual titles to cater to the mass-market users.

To resonate with its audience, the team focussed on making the users’ experience of crushing candies or shooting bubbles rewarding, to say the least.

“To each his own… Some are interested in card games, while others may like board games. Similarly, there is a particular group of audience that gets a high from racing cars or playing snooker or golf. So, we built a platform with 50+ games, most of them casual,” the founder said. 

In the beta phase, WinZO even tested a subscription model. Under this, users would pay a certain amount monthly or annually in anticipation of winning cash rewards. At one point, WinZO founders doled out TVs, washing machines and even sofa sets to winners.

However, it is always better to age like a fine wine. Hence, the founding team at WinZO took its time to evolve steadily and sustainably rather than moving impulsively to conquer multiple forts at once. 

Its thesis is directly in sync with how the team has refined its monetisation model over the years to become more accessible to a large group of users. Users can join by pooling in as little as INR 2 to play and win. “Players are matched with opponents, which can be either an individual or teams in the case of a large tournament. If they do well, they win some cash. That’s essentially the business.”

WinZO’s Test Of Trust

Once the team decided to make the platform a hub for casual gaming, the next task was to achieve the product-market fit, which, as per Nanda, is a journey and one doesn’t just stumble upon.  

“You just can’t walk into your office one day and expect one of your team members to shout ‘Eureka, we have found the product-market fit’,” Nanda said, adding that it’s more about identifying key metrics relevant to the product. 

The founder knew that WinZo had found its product-market fit by observing the most important metrics for gaming — stickiness and retention. Other crucial indicators were engagement, how much time players spent and how many games they played.

“We built thresholds unique to us. In gaming, typically only about 0.01% to 0.001% of users purchase virtual assets. But when we launched the first version of WinZO, the number was already around 3–4%. That was a huge signal. It meant we were at least a thousand times better than the industry benchmarks,” Nanda recalled.

However, reaching this milestone was not easy. One of its biggest challenges was convincing game developers to integrate with the platform. This was difficult because many developers were wary of working with an unknown player, especially one that is not on Google Play or Apple’s App Store.

In a market dominated by Android, skipping Google’s app marketplace could have been a death knell, but it forced WinZO to get creative with distribution. 

Growth was driven organically through word-of-mouth, referrals, and community engagement. Instead of burning cash on marketing, the team focussed on product stickiness and user experience to boost retention.

In fact, at one point, it got difficult for the Zostel founder to convince investors. “The first couple of years were marked by cold shoulders and rejections. But steady traction and metrics that bucked the industry norms began to turn heads.” 

So, what worked for WinZO? Well, to resonate with the new wave of internet users, the founder decided to go hyperlocal with a vernacular-first approach. 

At a time when almost every gaming company was offering their products only in English, WinZO decided to cater to the Hindi-speaking belt and started adding more local languages within the first year of its operations.

“When people seek entertainment, they don’t really want to strain themselves. Reading or understanding something in a non-native language becomes a barrier. So, native language became our moat,” Nanda said.

The second critical piece of the puzzle in the WinZO equation proved to be trust. This was because money was involved, and people wanted to be sure that the company would not fly by night with their money. 

“To build trust, we decided to remove the entry threshold. Money as little as INR 2-3 was enough to enter a game and win the prize pool,” Nanda said.    

WinZO’s 10X Top Line Leap

The idea of reducing the entry barrier to as low as INR 2 worked wonders for the WinZO team, and combined with the word-of-mouth, the popularity of the platform grew by the day. 

In addition, what helped the platform cross the first INR 100 Cr revenue mark was the Covid-19 pandemic. When people were confined to their homes and had nothing much to do, the adoption of the platform grew significantly. This was also the point when Nanda realised that WinZO was there to stay for a long, long time.  

Besides the app’s performance in terms of the increasing number of users, a widening prize pool and retention, what proved the viability of the business was its FY21 top-line numbers, which stood at INR 103 Cr.  

Interestingly, unlike the pandemic-bloated revenues of many internet startups that could not be sustained, WinZO’s revenues have grown more than 10X since the pandemic.

In 2022, WinZO brought cricketer Mahendra Singh Dhoni to its board and as its brand ambassador. Dhoni’s endorsements helped the company acquire more users.

A growing number of users keep the founder on his toes — adding new games and improving the quality of the existing ones.

How WinZO Creates Loyalists

Around 100 users join the WinZO platform daily. About 70 return the following day. Over the next few months, as many as 50% continue to use the platform. 

“These 50 become loyalists. They stick around as long as WinZO keeps delivering value in the form of entertainment. Much like how Netflix claims a spot in a user’s monthly entertainment budget, WinZO has become a part of their daily routine,” Nanda said. 

WinZO’s growth hinges on building cohorts. Every day, 100 people join and around 50 become loyal users. The process repeats daily, and the stack of loyalists keeps on growing.

Over the years, this growth has helped WinZO become an INR 1,000 Cr brand name. The company’s revenues stood at INR 234 Cr in FY22, INR 673.94 Cr in FY23 and breached the INR 1,055.20 Cr mark in FY24. Nanda, however, refrained from shedding any light on the company’s FY25 revenue growth due to ongoing audits at the company. 

WinZO Braces For GST Impact

WinZO’s adjusted profit after tax more than doubled to INR 315 Cr in FY24, up from INR 125 Cr in FY23. However, the company may not see a similar growth in FY25, according to Nanda. 

This is because, just like its peers in the RMG realm, WinZO, too, has been burnt by the revised 28% GST regime on RMG companies, which came into force in October 2023. 

He noted that the entire industry is under pressure. Notably, the GST Council’s decision to impose a flat 28% tax on the full value of transactions (regardless of whether a game is skill-based or chance-based) has significantly altered the unit economics of real-money gaming companies. Previously, an 18% GST was applied only on the platform fee for skill games.

Several major gaming companies have challenged these GST notices in the Supreme Court, but they’re being asked to comply in the meantime. 

“We are now paying nearly four times more in GST. This has led to a massive erosion of margins,” Nanda said. He added that FY25 will be the first full year under the revised tax framework.

WinZO is currently recalibrating to adapt to this new reality. The founder said that it will take a couple of years for the company to reach its full potential and aggressively grow its market share.

One way the company is toiling to offset these domestic headwinds is by accelerating its international expansion. “We’re already live in Brazil, and it’s been about seven to eight months now,” he said. 

“However, the global push wasn’t a reaction to regulatory pressures, it was always the plan. The timing just coincided.”  

While we believe Nanda’s statement, the company’s plans to expand its geographies have come at a time when several Indian gaming startups are shifting focus to international markets,  following the 28% GST regime.

Not just this, a key investor in multiple leading firms has cautioned that the sector is expected to face financial strain for at least the next three years. Now, as the Indian online gaming sector endures a churn, can WinZO register a win on the global pulpit?

[Edited by Shishir Parasher]