Is Arimac silently building a digital empire?

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They have offices in Dubai, Australia, Fiji, and the Caribbean Islands. Some of us know them for pursuing grand projects like building robots in Sri Lanka. Others know them for their video games.  As you walk along Galle Road it’s hard to miss the towering board that proudly displays their name. Yet, this didn’t happen overnight. This is how the story of Arimac unfolded over the course of a decade.

The origins of Arimac

Currently, Arimac consists of five separate business units. These business units offer distinct services, which are: web enterprise mobility solutions, gaming and creative development studio, immersive technologies, artificial intelligence and robotics and automation. Presiding over them is a creative unit, which Chamira describes as, “A layer that looks into ensuring consistent and proper UX across every single thing that we do.”

Chamira Prasad Jayasinghe (L) & Chinthaka Sandaruwan (R) - The founders of Arimac
Chamira Prasad Jayasinghe (L) & Chinthaka Sandaruwan (R) – The founders of Arimac

The largest of these business units is the one developing enterprise solutions. And despite being famous for their games, this is where Arimac’s origins lie as well. Back in 2008, its founders Chamira Prasad Jayasinghe and Chinthaka Sandaruwan were simply freelancers.

Inside the SLIIT incubation space in Malabe, they worked on the occasional odd coding jobs while pursuing their degrees.  Fast forward to 2011, the duo had decided they didn’t want to pursue ordinary careers. They wanted to build a business that offered a space for creatives to work and explore their ideas. The duo wanted to reduce the brain drain of such individuals in Sri Lanka.

Thus, they filled out the documents, registered the business, and Arimac was officially born.

But that was the easy part

“Even to spend Rs. 180 on a kottu on a Friday night was something we thought about twice,” says Chamira recalling their early days filled with struggles.

Despite the challenges they faced, Chamira and Chinthaka decided to reinvest most of the money the earned back into the business. By reinvesting their earnings back into the company, they were able to rent a small house in Malabe. Rather than utilize this house as a workspace, they decided to give it to their employees.

A glimpse inside Arimac's current offices (Image credits: Arimac)
A glimpse inside Arimac’s current offices (Image credits: Arimac)

This is a practice that continues even today, with Arimac offering its employees apartments in the complex that’s directly opposite their current office. “They usually stay there until they get married and have kids,” says Chamira with a bright smile. But it doesn’t take a real estate agent to tell you that this can be expensive.

Luckily for Arimac, their clients are some of the biggest companies in the world. This list of clients includes Emirates, Etihad, Tesco, Dialog, MAS, Vodafone, Srilankan Airlines Coca-Cola, Unilever, and Nestle. Of course, they didn’t obtain these clients overnight. Neither was it through a smart marketing hack.

Chamira and Team Arimac after a successful pitch
Team Arimac after a successful pitch (Image credits: Chamira Prasad Jayasinghe)

“Personally, I don’t believe in marketing. I believe that if we do good work for one client then they’ll introduce us to others,” states Chamira. As such, for the first six years of its existence, Arimac didn’t have anyone doing sales and marketing. It became a necessity as the company grew. Yet, Chamira stands by his beliefs even today because that’s how they got their big break.

The great gamble that changed everything

This big break for Arimac was the Sri Lanka Premier League cricket tournament. In 2012, Arimac was working with Bathiya and Santhush to manage their website and execute digital strategies. One day, Bathiya and Santhush went to Arimac and offered a project to build a system to live stream the matches of the tournament.

Chamira initial reaction to the offer was, “I didn’t even know how to do it but I said yes.” They were taking a huge risk. Four days later Arimac had a solution. And it worked beautifully. Their solution went onto be used to stream various other sporting events including the Indian Premier League. This success started a chain reaction.

A few of Arimac's many clients across the globe
A few of Arimac’s many clients across the globe

Soon afterward, Chamira and Chinthaka met Saliya Weerasekara – CEO and Founder of Ants Work. Saliya had introduced Arimac to Sri Lankan management of Nestle, Unilever, and Coca-Cola. Soon afterward they were offered jobs from other countries. An example Chamira shared was, “We did a solution for Coca-Cola in Sri Lanka. They were impressed and introduced us to the management of Coca-Cola in Indonesia.”

Since then Arimac has worked on various projects for clients across the globe. One of these is Arimac Airspace, which is a solution for airlines to manage their crew and passengers. A few local examples are those it’s done for Dialog, which is the eZ Cash app, Star Points app, the Dialog VR Zone and Dialog Mega Run.

“Personally, I don’t believe in marketing. I believe that if we do good work for one client then they’ll introduce us to others” – Chamira Prasad Jayasinghe

A regional example would the Dhiraagu Mamen App, which was for one of the largest telecom operators in the Maldives. One by one, the unknown Sri Lankan startup was racking up clients across the globe. Arimac’s big gamble had paid off. Looking back Chamira says, “That project changed everything. Even today, I’m still grateful to Bathiya and Santhush & Saliya Weerasekara.”

Learning from failure and building video games

As a kid, Chamira loved making video games using Visual Basic 6. He proudly shares that his crowning achievement was building a chess game in 2007.  With the help of the late Prof. Gihan Wikramanayake, Chamira’s game had bested G. C. Anuruddha – the Sri Lankan chess champion at the time.

So he was excited when Thilina Premasiri joined Arimac. It was Thilina that convinced Chamira and Chinthaka to pursue game development. Seeing Thilina’s excitement for building video games, it was decided to create a separate business unit for it. Led by Thilina, this team inside Arimac would go to build over 100 titles for various clients.

Yet, the games that made the name Arimac famous were early titles like Chakra and Kimaki. These were simple Android-based arcade games. The purpose of these games Chamira explains was, “We wanted to fight with the titan’s head to head with our local talent. So we needed to understand our competitors and how they react.”

But exactly how successful were these games by Arimac? With a soft smile and a light sigh, Chamira answers the question by simply saying, “We failed.” However, these weren’t their biggest adventures in the world of gaming

The mixed success of Kanchayudha

In 2016, Arimac embarked on its most ambitious gaming project yet. It would be a story-driven open-world adventure game set in a prehistoric Sri Lanka. This was Kanchayudha. The game follows the adventure of a warrior named Bhadra in his quest to find a weapon called Kanchayudha.

Kanchayudha by Arimac was the game that made it famous
Kanchayudha by Arimac was the game that made it famous

The game was launched in December 2016 for PC to much fanfare and hype. Everyone (us included) was excited for a game set in Sri Lanka. And then Arimac made a decision that caused Kanchayudha’s popularity to explode. They made the game free to play and asked only for a small donation if people liked it.

As its popularity exploded, Kanchayudha set a standard for Sri Lankan game development. Arimac’s popularity too rose as it gained a loyal community of fans. And heaven protect anyone that posted links to torrents of Kanchayudha from the ferocity of these fans in the comments sections.

Yet, critics would argue that the standard Kanchayudha set wasn’t very high. The game launched with a host of bugs and optimization issues. And Chamira is inclined to agree with them saying, “As a company, we failed. But we learned a lot. We understood how to optimize our games based on the constructive feedback we received.”

That might sound a bit extreme to some. Sure the game wasn’t perfect. But with the fame and hype surrounding it shouldn’t Kanchayudha have been a success? 

Chamira answered this question by saying, “The thing is we failed because it was a loss to the company. We spent Rs. 20 million on it and didn’t earn it back. But it was a learning experience and I think it paved the way for a gaming industry in Sri Lanka.”

And despite what skeptics might say, it actually did. A common theme amongst the young game developers we’ve was that they were initially nervous about the idea of building games in Sri Lanka. But when they saw Kanchayuda, they began to believe that their ideas could work.

Surviving in a land where game developers die

Despite Kanchayuda and its previous titles, Arimac isn’t the first video game development company in Sri Lanka. Long before it ventured into this industry, there were companies like Dawn Patrol Games. Chamira still considers its founder, Prithvi Virasinghe to be one of the greatest game designers in Sri Lanka.

Arimac Lanka | Digital
Prithvi Virasinghe – Founder of Dawn Patrol Games, which was the largest game development studio in Sri Lanka at one time

However, Dawn Patrol died. Similarly, others like GTS, which produced Colombo Racer also met the same fate. So how did Arimac avoid this fate? Chamira answers this question by saying, “I think they were too ambitious. They bet all their money on one big project and lost.” As such, Arimac decided to travel down this path on a slow and steady pace.

They built simple games that didn’t take too much effort. These were experiments, which despite being commercial failures helped them understand the market. Furthermore, Arimac had other business units. As such, the other arms of Arimac were able to cover its losses when building games.

Arimac Lanka
The KodeX team with Thumindu Dodantenna, which is one of the newer game development studios in Sri Lanka

However, the latest generation of game developers doesn’t have operations even remotely close to the size of Arimac. So how can they survive? Collaboration. “To make a Triple-A game you need a large team of thousands,” says Chamira. He believes that there’s untapped creativity amongst these young developers.

But for an industry to be born, they’ll need to collaborate. This is a challenge as many of them are spread out between Colombo and Kandy. But Chamira teased a project Arimac is working on to help overcome this. Yet even now as he looks back at the older game developers like Dawn Patrol says, “With their knowledge and experience they should be mentors.”

Making money in the land of piracy

Ultimately, for any company to survive it has to make money. However, we Sri Lankans are a people that are proud of torrenting 100 GB of movies, songs, and games whenever SLT or Dialog gives us free data.

In such a country how can game developers convince people to pay for their games? Chamira’s only response was simply, “I don’t know.”

He went onto say that the decision to make Kanchayudha free to play was a last minute decision. One that he was very stubbornly advocating. “If we charged even Rs. 50 nobody in Sri Lanka would buy it,” Chamira explains. Ultimately, this stubborn decision did make Arimac and Kanchayudha famous.

Nonetheless, it was a commercial failure. Therefore, for game development to be viable in Sri Lanka it needs to be sustainable. And for it to be sustainable requires figuring out how to make Sri Lankans pay for a game.

Arimac
Despite the rise of Steam, piracy is still a prevalent problem in Sri Lanka (Image credits: The Verge)

It’s challenging because this isn’t a problem that can be fixed by passing a few laws. Rather, it requires a change in our mindset. A daunting task, but one Chamira looks at it enthusiastically saying, “You should be able to sell even a used underwear. There is a solid theory out there. We’ve just got to find it.”

From its experience in video games, Arimac has now ventured into making 3D movies. Compared to video games, these are more challenging says Chamira because “With video games, it’s a mix of creativity and engineering. But movies are more towards the creative side.”

Looking towards the future with AI and robotics

These days it doesn’t matter what industry you’re working in. Artificial Intelligence is everywhere. Some call it another in a long line of buzzwords. Others believe in its potential to invisibly transform the world. Arimac is among the latter.

But interestingly this wasn’t an area they were looking at. In fact, the business unit Arimac setup to offer these services is only 18 months old. Chamira went onto share with us that they began exploring AI and computer vision almost by accident.

Artificial Intelligence. Arimac's next big frontier
Artificial Intelligence. Arimac’s next big frontier

“Being a services company, different clients asked us to provide AI services for them as well. We didn’t accept them because we didn’t know how to offer it. But we wanted to learn,” he says. Thus, a small team inside Arimac began taking courses on the topic of AI to understand it thoroughly.

Afterward, they hired engineers that specialized in AI and created a separate business unit. But AI isn’t the only technology Arimac is exploring for the future. Another area the company is looking at is robotics. We got a glimpse of this at this year’s Google I/O Extended by Dialog when Chamira unveiled Arimac’s robot Diyazen.

Chamira Jayasinghe - Founder and CEO of Arimac speaking at Google IO Extended Sri Lanka 2018 by Dialog and GDG Sri Lanka
Chamira announcing Diyazen at Google I/O Extended Sri Lanka 2018

“That’s their workshop. Different explosions and different things happen in here,” says Chamira pointing to the room next to his office. This workshop belongs to a small team of six engineers. They’re the ones that are currently working on Diyazen.

However, this isn’t Arimac’s first venture in robotics. Previously, the company had partnered with Chinese and Japanese vendors. With this partnership, they had built a robot for Dialog. This too was a humanoid robot that worked as a customer service assistant. Equipped with a touchscreen, it worked inside the Dialog Iconic Store to assist customers.

But Diyazen is different. This is a robotics platform that Arimac is building from the ground up. The company is planning on manufacturing these robots in Sri Lanka. But at the moment it’s a work in progress. And the team alternates in writing the software and building the hardware. If all goes according to plan, Diyazen should roll off the production lines in 2019.

Building a Digital Empire with Startups

One of the most surprising announcements we heard from Chamira at Google I/O Extended this year was that Arimac had acquired ShoutOUT. This was one of the two startups that Arimac had recently acquired. Chamira declined to share details of the second startup.

However, he shared that while ShoutOUT had been in the market for three years. Yet, they had struggled to acquire customers. “They had a good product but their strategy wasn’t great,” explains Chamira. Seeing this, Arimac decided to acquire ShoutOUT and revamped their strategy.

Team ShoutOUT - one of the startups that Arimac has acquired
Team ShoutOUT – one of the startups that Arimac has acquired

Since then, ShoutOUT has recovered and is doing well. But this is only the first in what Chamira hopes will be a long line of acquisitions by Arimac. As the company scales, it’s looking towards acquiring startups that offer great digital services. And when doing so, they’d ask for a hefty 51% stake in the company.

Chamira explained this saying, “We want to keep 49% with the founders. They’re the ones that came up with the idea for the startup. But at the same time, we’re taking 51% because we want to safeguard our investment. We don’t want the founders giving up just because things are tough.”

Interestingly, Chamira shared that he’s not too keen on due diligence. He explains this saying, “Because it’s a theoretical process to check how much money you’ll make. You can evaluate that from the founders. And if anybody wants to screw you over they will. A piece of paper only makes it harder.”

The ambitious vision for the future

Ultimately, Arimac hopes to acquire and incubate 50 startups by 2021. These startups would be from Sri Lanka and across South East Asia. “We want all of them to succeed and by then we also want to be the first digital unicorn in Sri Lanka,” says Chamira looking towards the future.

Arimac
Chamira’s vision is a simple one. Make Arimac Sri Lanka’s first digital unicorn

It’s an ambitious vision. Yet Arimac has been around for 10 years. In that time, it’s grown massively. What started off as a collection of freelancers is now a conglomerate with offices in Dubai, Australia, Fiji, and the Caribbean Islands. One that’s survived adventures in game development and is looking at developing its own robots. Adventures that have killed others that attempted the same. So there is hope that it can one day become a unicorn. Hopefully, with the passage of time, we’ll see that ambitious vision become a reality. 

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