Inside Social Games

Last year, the venture capital and angel funding for games and virtual worlds tallied just below $1 billion, which amounted to half of the total investments in the media and entertainment market as a whole. Yet every month, we see companies tackling the convergence of social, casual, or mobile games appear on the scene.

The latest is WonderHill, who just closed $7 million in a Series A funding round led by Charles River Ventures and Shasta Ventures. The money will be used for the company’s first round of web-based casual games. While this is less than the totals raised by bigger shops like Zynga and Playfish to date, it is enough to get multiple projects up and running.

Since many titles in the market are clones of successful ones (ala the Zynga RPG design), they are never given a second glance. WonderHill, however, is looking to stand out with its concept of “wholesome” titles. Targeting the 30-plus demographic, the company has built two games for the MySpace platform: Green Spot and Dog World (the latter is also available on Facebook). In the games, you save the rain forest and rescue pets, respectively.

With both titles, the creators haven’t used advertisements as the main source of revenue. Instead, they are building a business based on microtransactions. Each game has a cause affiliated with it, where WonderHill donates a portion of the money (the Nature Conservancy’s Adopt an Acre and the ASPCA’s One Dog One Day program).

WonderHill’s CEO, James Currier (who is also the founder of the viral marketing firm Tickle and a board member for Linden Labs), says the company is looking to take the “Pixar approach” to their games, combining family game concepts with excellent production value. In addition to Currier, the team of 15 also includes CTO Stan Chudnovsky of Tickle, and Chief Creative Officer Nick Rush, who has executive experience at Pogo, Electronic Arts Online, and iWin.

While it remains unclear what the new titles will look like, the company says it plans to start with basic word and card games, before delving into more unique gameplay. The company will continue building on MySpace and Facebook, and eventually the iPhone as well.