Harvard Business School Alumni Bulletin

Latin Flair

by Margie Kelley

It may have taken them two years to finally find their entrepreneurial feet in the online world of social media, but the three cofounders of Vostu.com have no regrets. The social game developers recently told the Financial Times (March 21, 2011) that they had to scrap their first few concepts for the Brazil-based Vostu, including hopes of creating a Latin American version of Facebook, before settling on social gaming in 2009.

“It was really difficult to monetize down there [in Latin America],” Joshua Kushner (MBA ’11), the company’s 25-year-old chief strategy officer told the FT. “So we pivoted to gaming.”

That decision changed everything. Now, Vostu is the largest social game developer in the Brazilian market, with games like Mini Fazenda (Small Farm), Vostu Poker, Joga Cracque (Soccer Star), Café Mania, and Mega City. The games are built to play on Google’s Orkut, a social networking site that is popular across Latin America.

Cofounders Daniel Kafie and Mario Schlosser met during their MBA studies at HBS and graduated together in 2007, while Kafie met Kushner when they were both undergraduates at Harvard College. Together, the trio has turned Vostu from a tiny 12-person start-up to an operation with close to 400 employees in three locations: São Paulo, Buenos Aires, and New York.

“More than 40 million Brazilians have played our games thus far. The business model is based on the notion that while the games are free to everyone, we have a ‘freemium’ model, where some users choose to pay for special items or quick level-ups in the game,” says Kafie. “Our users can pay using their credit card, mobile phone, and even at more than 60,000 physical locations across the country.”

Already, the founders say, Vostu is turning a profit, though it is holding onto recently raised VC cash while it solidifies its position in the market.

Suddenly, the slow-to-start Vostu is on the fast track. Kafie, who went straight to HBS from Harvard, wouldn’t have it any other way. “It’s very different to walk into HBS when you’re 23 years old, with the entrepreneurial bug, than when you’re older and [making a] big career move,” says the 28-year-old chief executive. “[But] I knew that if I didn’t go right after college, my opportunity cost to go back to school would only get substantially greater. At the same time, I can’t imagine myself doing anything traditional, even at an older age.”