On Monday, we wrote about social game publisher Mentez, which specializes in localizing games for the Brazilian market and Orkut, the most popular social network in that country. Mentez claims some 22 million users across its games, has a new partnership with Playdom, and just raised money from Insight Venture Partners.

We caught back up with CEO Juan Franco to hear more about his company’s strategy of localizing other developer’s games for Brazil and other Latin American countries. This interview is part of our ongoing series about localization worldwide.

Inside Social Games: Tell us about the Brazilian market.

Juan Franco: The Brazilian economy is booming, not only the technology sector but every other sector. People believe that it’s going to become the number five economy in the world soon.

There are more than 70 million people with internet today, and that’s growing over 10 percent a year, so we expect that in a couple years we’ll have more than 100 million internet users. There are almost 200 million mobile phones, so the mobile market is strong as well. As far as social networks, there’s Orkut, then Facebook, which is growing but still not as large.

[At Mentez] we have a strong monetization platform that’s a combination of online and offline. In Brazil, about 40 percent of people don’t have a credit card, so there’s a payment gateway to process cards, and 120,000 points of sale on the street, so users can go and buy the credits. Also, 35 percent of the population accesses the internet through cafes.

ISG: What cultural differences do developers need to know about?

JF: When you launch a game in Brazil, it’s not just about translation, it’s localization. So we work with third party developers and spend a lot of time on localizing — which means translation, changing names, adding specific content for Brazil.

It’s all about the language, the content, the way people play the game. I believe that one of the key factors of our success has been to really localize for Brazilian users, and the next generation successful of games will be those that really create stories for the Brazilian users, [like] a game about the Amazon, or Carnaval.

You should go during Carnaval. There’s no other place in the world to see what it’s really like for a Brazilian. The country stops. You need that sort of thing in the game, but that’s not easily understood by a developer in California or the UK.

Another example is that in farming games in Brazil, users could steal from other users. That wouldn’t work in the US or Europe, but for Brazilian users it was a key functionality, and it’s a reason our farming game is number one in Brazil.

ISG: You don’t make any games of your own. What’s your process for working with outside developers?

JF: At this time we’re focused on the quality of games. The next generation is high quality, so we’re doing research on that. Basically we sign our partnership to work together, we do translation, we have our own developers who develop local content for the game. We provide the local content, they integrate it, and we launch the game in the market. We’re now trying to release three games every three months.

ISG: How does publishing and marketing games on Orkut compare to Facebook?

JF: For a new developer that’s launching a new game today, it’s ten times more difficult to grow the game than six months before, the same as on Facebook. But for us, it’s still easy to grow our games. The industry has gone to the big players.

ISG: Will Orkut grow any further in Brazil? And what’s your take on Facebook’s chances?

JF: Right now Orkut is huge, I believe the number one site in Brazil. My estimation is that it has over 50 million users. So for Orkut to keep growing is difficult. I don’t believe they’re growing because they have 80 percent penetration of internet users, and from what I’ve seen Google is investing in Orkut and they want to keep their leadership.

But Facebook is investing as well. The way that Facebook is growing in Brazil is with high-income users, people that speak English or have friends in the US. They’re very strong with the high-income users. However, the Brazilian market is a massive market, so if you want to be a player in Brazil, you need the rest, where Orkut has its leadership.

ISG: How well do Brazilian users monetize?

JF: The good news is that the Brazilian user’s monetization behavior is similar to the United States. Four to six percent of the user base does transactions, versus what I hear is about six to eight percent in the US.

For our only game that has been on the market for more than a year, we’ve seen users spend $10 per year. The life-cycle of our games, from what we’ve seen, is 8-12 months, but like in any other market they eventually get flat and start to decline.

This interview is part of an ongoing series on localization. Past coverage includes:

Wooga: Spreading Across Europe
RockYou: Working in Japan
6waves: Localizing for Asia