About Kai
Kai Huang is an entrepreneur and game industry pioneer best known for co-founding RedOctane and creating the iconic Guitar Hero franchise. After graduating with a degree in computer science from the University of California, Berkeley, Kai began his career as a consultant at Accenture, working with Fortune 500 clients on supply chain management. In 1999, Huang co-founded Adux Software, a company developing solutions for the server appliance market, which was successfully sold that same year.
Following this, Kai and his brother, Charles, co-founded RedOctane, initially as a video game rental company modeled after Netflix's mail-based DVD rental business. RedOctane evolved from game rentals to producing high-end accessories for popular games, including dance pads for Dance Dance Revolution. In 2005, Huang and his team at RedOctane published Guitar Hero, which revolutionized the music game genre and became a global phenomenon. The game's success led to Activision acquiring RedOctane in 2006 for $100 million.
After the acquisition, Huang continued to serve as President and CEO of RedOctane until 2009. The Guitar Hero franchise went on to generate over $2 billion in retail sales worldwide. Following his tenure at RedOctane, Huang co-founded Blue Goji, an interactive fitness company aimed at making health and fitness more engaging and fun. He is now a founding and managing Partner at 886 Studios, a venture firm in Taipei.
Q&A w/ Kai
886: Why were you motivated to start your own company?
Kai: “I’ve always wanted to start my own company, probably since junior high or high school. I credit a lot of that to my dad; he started several businesses and would often say things like, ‘At some point in your life, you should start thinking about starting your own business so that you can do something for yourself and have better control over what you do.’”
886: What was your path?
Kai: “I graduated from college, and since I wanted to go back and get my MBA, I decided to go into consulting, thinking I would do it for a couple of years and then return to business school. This was the late ’90s, the era of Internet 1.0, and there was just so much activity. I thought, ‘I can always go back and get my MBA if I want, but this is an interesting opportunity in terms of timing to start my own company.’ My first startup was with my brother and two other co-founders and focused on server appliance software. After we sold it, we began thinking about starting another company.
“The idea my brother and I had was to rent video games online—think Netflix, but for video games. At the time, it was a billion-dollar industry. Many VCs were interested, but there were no real video game rental companies, only movie rental companies. We thought that if we could make things more convenient for the average video game consumer, we could capitalize on the huge rental industry and grow the whole pie. That’s how we started what eventually became RedOctane (acquired by Activision for $99.9 million in 2006).”
886: How did you approach pivots in your business, and what drove the decision to make those changes?
Kai: “At one point, we were renting Dance Dance Revolution, and many customers were asking if we also rented or sold the dance pads. For months, we told them, ‘No, we don’t deal with hardware; we only rent games online.’ But when the market collapsed and we needed to generate revenue, we thought there might be a short-term opportunity to make money on the side.
“The dance pads started to sell well, and after about four months of selling pads sourced from a distributor, we received a lot of feedback and ideas from customers. After another six months, we decided to make our own dance pads. In retail, pricing can often shape the perception of quality, and it’s much easier to lower a price than to raise it. So, we decided to price higher. We launched our first product, and it performed really well, helping us build a strong reputation. We realized that the high-end market was a major area we could focus on.”
886: How do you manage decision-making?
Kai: “I rarely go all in. I look at it as if you’re cooking and you’re juggling pans on a stove, and there are always three or four pans at a time, and it depends on which pan is in the front, which one is in the back, on the side… sometimes tasks have to be moved to the front, sometimes others are moved to the back burner or killed… it’s very rare that I say ‘everything dies, just focus on one pan.’ You just have to figure out how to manage it - focus is important. You need to understand how to have focus but also keep things alive on the back burner.”
Reading Recommendations:
- CrunchBase
- TechCrunch
- Your network - staying current with industry news and learning from those who know more than you
Companies
