Iowa startup hits gold in computer gaming

Iowa startup hits gold in computer gaming

Phantom EFX makes solid gains in card, casino sports worldwide

July 21, 2007

EFX graphic artist Andrew Bouska, right, talks to President Jim
Thompson about a slot machine simulation game he’s developing with an
“Alice in Wonderland” theme. The Cedar Falls company plans to release
the game Sept. 4. The company has grown to dominate the worldwide PC
card and casino games industry.

Cedar Falls, Ia.
– It’s a good thing that Aaron Schurman is a gambling man.

years ago, he and a childhood friend bet big that their slots and video
poker game would hit the jackpot – even as top gaming companies shooed
them away and their parents continued to pay their rent.

were told there was no way the market could bear another gambling game,
and that we couldn’t break into that market," said Schurman, 35. "Look
at us now."


How to keep customers returning to the business

tips from Aaron Schurman, Phantom EFX’s chief executive, about how even
a small company can attract a loyal, worldwide customer following:

1. Every customer service phone call is answered by a real person.

"We all hate having to press 1 for this or 2 for that … and we know our fans do, too. So, we don’t do it."

2. Have an online phone assistant ready, always. "Do not keep them waiting."

Have an online message board and monitor it constantly. "I want our
customers, our fans, to know we are listening to their comments and
advice. We reply to them every day so they hear us … hear them."

4. Build loyalty within. "Our customer service staff understands the game because (members) are avid Phantom EFX fans, too."

Promote accessibility. "Our customers have direct access to me,"
Schurman said. His e-mail address is readily available, and he replies
directly to queries on the Web site, often sending personal notes to
fans as well.

Now, Schurman is chief executive of Phantom EFX, the
leading publisher of personal computer card and casino games in the
world, according to the NPD Group, an industry research firm. Its most
popular title, "Reel Deal Slots: Mystic Forest," has been the
top-selling game in the card and casino category every month this year,
according to the group, and more than 12,000 retail outlets carry
Phantom games. The company has grown from two lifelong pals to a quirky
cast of 32 that has animators working alongside math whizzes to push
out about three new games a year.

All of the titles are
developed from start to finish at the company’s Cedar Falls
headquarters, where pinball machines and video games abound and Nerf
ball fights are a common workplace occurrence. Many of the games are
born or finessed from a conference room, aptly named "The War Room,"
with white boards, lighting, projector screens and amplifiers.

you’ve ever seen the old movie ‘War Games’ with Matthew Broderick,
that’s what it’s like to me," Schurman said. "It’s our creative think

Schurman cites the "extremely high-level quality" of each
$20 game. But what most pleases Schurman is the loyal following they
have attracted. Traditional video gamers tend to fall in the 15- to
25-year-old demographic, but Phantom EFX’s target audience are "casual"
players who range in age from 35 for its casino games to an average of
51 for the slots, company president Jim Thompson said.

"The (15- to 25-year-olds) aren’t really a demographic we hit at all," he said.

said he "absolutely loves" Phantom’s players because they are
interactive and appreciative of good customer service. Faithful fans
are known to send loads of baked goods to the Phantom EFX team during
the holidays and "get well" wishes when someone is out sick, he said.

like, ‘OK, this is just a video game,’ " Schurman said. "But what we’ve
learned is it’s much, much more than that to many, many people."

the PC video games, Phantom EFX hosts an online subscription community
where hundreds of players can interact with one another in a virtual
"casino" and play the slots, place bets or receive a live-feed sports
book direct from Las Vegas casinos.

No money is wagered in the
online games. The feature has increased its $10-a-month memberships
nearly every year, and it drew more than 200 players to Phantom’s most
recent annual "Phan Fare" bash in Las Vegas.

Dicki Esser, a
retired secretary from central California, said she became hooked on
Phantom’s computer slot games years ago but "went nuts" when she
discovered the company’s online casino, where she talks daily with –
and plays against – other players around the world. She said her
husband, who used to go with her regularly to the area’s local casinos,
said Phantom "has saved us thousands of dollars" because they now play
the slots at home or online but with no risk.

"We aren’t just fans," Esser said. "We are rabid fans."

who recently was asked to be a "tester" for Phantom’s new games, said
online members are impressed with the company’s accessibility –
Schurman posts a daily update on the Web site – and its prompt customer

"You can go online anywhere and play a game," Esser
said. "But where else can you go online, play a game and talk to the
CEO? Or get your questions answered personally by him?

"It’s so fun. I haven’t found anything else like it."

natural growth opportunity for Phantom has been developing slot
machines for real casinos, which the company began doing two years ago.
Soon Phantom EFX slots will be found in casinos in the United States;
now, their slot machines are largely sold in South America, Thompson

"Our core business is still video games, but we have no doubt there’s more growth ahead with the slot machines, too," he said.

said the company recently started 8monkey Labs, which will release a
new type of computer and Xbox 360 game called "Darkest of Days," aimed
at the hard-core gaming audience.

"We have all kinds of things
going on here," said Schurman, who already talks about breaking into
the mobile phone category so players can have access to Phantom EFX
games whenever the mood strikes. "No one can tell us it can’t be done

Phantom EFX
employees shout in unison at the company’s recording booth in Cedar
Falls. They were providing sound for a new game to be released Sept.4.
They are from left, Leslie May, Kent Stowe, Jeff Taylor, Dale
Santoiemma, Paul Lohman and Rene Tietz.







Phantom EFX


FOUNDERS: Aaron Schurman and Danny Stokes

Privately held publisher of personal computer card and casino games;
titles include “Reel Deal Slots: Mystic Forest” and “Reel Deal Casino:
High Roller.”


SALES: Leads
the industry in the card and casino game category, with 32percent more
sales than the No.2 publisher through May, according to the NPD Group,
an industry research company.

RETAIL OUTLETS: Games are available at more than 12,000stores, including Best Buy, Circuit City, Office Max, Target and Wal-Mart.

MORE INFO: For more information or to try a free slots game, go to

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