• Marc Ruxin, EVP and Chief Innovation Officer at Universal McCann, who leads media innovation across all emerging digital technology and traditional media companies for UM’s global client base.
• Eric Bader, Chief Strategy Officer at Initiative, a new media and marketing leader with deep experience in strategy, brand marketing and business-building solutions for Fortune 500 companies.
• Joe Hyrkin, who formerly held senior management positions at Yahoo! and Gaia Interactive, and who is now an Entrepreneur in Residence at Trinity Ventures.
• Doug Chavez, Director, Digital Marketing at Del Monte Foods, who brings over 15 years of traditional and digital media experience having worked with brands such as McDonald’s, Kodak, Yahoo!, and Visa to strengthen their market presence and positioning.

We’ve already begun bringing leading brands into the social gaming space, and we’re hoping to leverage the expertise of our advisory board to continue to make this happen!

We’re pretty confident over here at gWallet. In fact, we’re so confident that publishers will increase their revenue using the gWallet platform that we’re offering a cash guarantee.  If the desired results are not achieved within 30 days, gWallet will pay the publisher $20,000 cash. That’s right, $20,000 dollars!!

Qualifying premium publishers can sign up starting today for the month-long challenge. They will put their existing solution head-to-head against the gWallet platform for 30 days, and if they don’t see a growth in revenue, we’re paying up. Integration takes only about two hours of development time, and then the challenge will begin!

For more information, check out our official release or email: partner@gwallet.com.

Earlier this year, you may remember that we launched a unique new way to earn virtual currency…watching video clips.  Since we made this new type of offer available, consumers have watched more than 1.7 million minutes of video ads from leading online social games, social networks and applications using the gWallet platform.

Not to brag, but 1.7 million minutes ain’t too shabby. In fact, that’s about 1,180 days—or a little over 3 years of viewing time. We even had an advertiser return to run a second campaign with us, with a budget of over $100,000!

Both the brands and our publishing partners are thrilled with the results they are seeing. Our publishers have told us that as user impressions are skyrocketing, monetization opportunities have increased 4 to 5 times. These are the kind of numbers we like to see!

If you don’t believe us, see what some of our friends had to say:

• Will Harbin, CEO of CasualCollective: “The video offers from gWallet have brought a new level of engagement to our site — our users love earning coins by simply watching cutting-edge video ads and movie trailers.”
• A gamer on Foopets.com [1]: “I think that [watching videos] is a great and easy way to earn FDs (FooDollars), and I’m running pretty low on them myself…I think it was very kind of FooPets to give such an easy privilege to earn FDs.”

We’ll we’re done patting ourselves on the back for now. Stay tuned for more… In the meantime, keep watching those videos and earning that virtual currency!

Crystal Palace Space Station
The World Record for “Most Expensive Virtual Object” was broken earlier this year and is currently held at $330,000 USD by Erik Novak who purchased the Crystal Palace Space Station in a public auction. The auction was held by First Planet Company, developer and publisher of the MMORPG, Planet Calypso. He broke the standing World Record by over 300%.

Club NEVERDIE Resort and Treasure Island
Previous World Records have included a virtual space resort, sold for $100,000 USD in 2005, and Treasure Island on the planet Calypso that sold for $26,500 USD in 2004—both a part of the Entropia Universe. The space resort turned out to be a successful investment reportedly bringing in over $50,000 USD in mining/hunting rights alone in its first five months—and that’s not including the additional real-money revenue brought in by the virtual nightclub and property sales on the resort!

Atrox Queen Egg
This virtual egg was sold for $69,696 USD. Interestingly, it was purchased by the same player who purchased Treasure Island, David “Deathifier” Storey, from Jon “NEVERDIE” Jacobs—who purchased the space resort.

These increasingly popular virtual worlds are now creating new entrepreneurial opportunities for creative, business-minded players.

So tell us, what would YOU buy using virtual currency?

Social gaming has a reputation for being addictive and we see this daily when reading up on the industry (disclaimer—even gWallet has our share of social gaming addicts. It’s hard to take a walk through the office without seeing Mafia Wars or Farmville…). Like any other addiction, social gaming has its extremes, and they are interesting/surprising/disturbing to say the least. For the last few months, we’ve been flagging some of our favorite stories, and we wanted to share our favorites with the world.

So without further ado, here are our favorite social gaming stories of the last couple of months:

• Giving the Farm a little too much attention – Dimitar Kerin is like millions of other Farmville players who may occasionally pay a little too much attention to their farms…with one big difference. Dimitar worked on the Plovdic City Council in Bulgaria and was playing doing council meetings. It was determined that Dimitar spent too much playing and he was voted off the council. His defense—he was not the only councilman playing – Read more

• “I’m selling the car and buying an island” – Virtual goods are growing more extravagant by the day, and few purchases demonstrate this better than the man who spent $26,500 for an island in a virtual world. When asked to explain his purchase, the buyer said “I thought it would be cool to own an island” – Read more

• No gaming after midnight – In South Korea, three of the most popular online games were directed to block people under the age of 18 from playing between midnight and 8am. The real highlight of the article though—the most successful professional StarCraft player of all time is a celebrity in the country, with a girlfriend who is a popular actress. They have been labeled as “the South Korean equivalent of Ashton Kutcher and Demi Moore” — Read more

• In need of a farm keeper or marriage counselor – In yet another case of farm inspired craziness, a Chinese couple who had been together 4 years decided to suddenly break up. The reason—the pregnant woman in the relationship overslept and did not attend to her boyfriends farm, subsequently leading to his crops getting stolen – Read more

• Love at first click – This story falls more into the category of general gaming rather than social gaming, but is too good to pass up. In Japan, there is a new dating game called Love Plus, where interested men can interact with virtual girlfriends. Showing that even virtual relationships require work, the “girlfriends” require that the men say “I love you” aloud into a microphone 100 times, and sometimes require the men to kiss the computer screen. – Read more

Yep, it is a crazy world out there.

If anyone has their own amusing social gaming stories that they don’t mind sharing, feel free to send them our way at info@gwallet.com. We’d love to do a follow up post with your own stories.

Interns will be playing roles in Sales, Business Development and Operations. We are looking for smart, creative, and ambitious individuals who can keep pace at the startup life.

If your interested in joining, email internship@gwallet.com and include an updated resume as well as a one-pager explaining why you should be selected.

We expect a large response so this is limited to U.S. applicants only.

Look forward in working with you.

gWallet Team

Enough with old news though—today we want to let you know about our latest effort to leave a mark on the social gaming space, gWallet Ventures. gWallet Ventures is an early-stage fund that we created to invest in various social gaming companies. We like to think that by doing this, we are actually investing in the social gaming ecosystem, and are simply doing our part to ensure that quality games continue coming to market.

We are currently looking for companies to invest in (our criteria is fairly simple—if you have fun games, we’re probably interested), and we’re excited to choose our first portfolio company. We plan on playing an active role with all of the companies we invest in, and we’ll do our part to make sure the best games out there are brought to the masses.

If you are interested in learning more (or if you own a social gaming company and would like to inquire about funding), check out http://www.gwallet.com/ventures/. We’d love to hear from you, and we look forward to seeing some new games.

Gurbaksh Chahal
Founder, Chairman & CEO
gWallet, Inc.

As many of you know, I originally created gWallet to be a platform for offers in the coupon space. We tried that and changed our direction. I’m probably the most critical person and I’ve set the bar pretty high for myself. I sold my first Company for $40 million at 18, my second one for $300 million at 25, and at 27 started gWallet. Even though the coupon space was interesting, it wasn’t quite big enough of a challenge for me. I also have an important philosophy when it comes to business that I even mentioned in my book. Here’s an excerpt from it:

“Most people think they need to know exactly what they want to do when they start a business, but they’re wrong. If you go into something with a very specific plan, you might be so focused on your goal that you won’t see the promising opportunities that present themselves as you make your way along. Take the blinders off. Look around. Don’t be afraid to go off on all sorts of unusual directions, since that’s where you might just find the most unusual—and promising—opportunities.”

That’s why we changed our focus and became a platform in the virtual currency space. And have had tremendous success thus far. It’s a new, multi-billion dollar market with a bigger challenge and something I feel we can dominate.

And, even though we raised $12.5 million – that just means the journey officially begins for us. The formula to success is going to be on hiring the best rockstars, innovating, and most importantly executing. The capital will give us great resources to open new offices throughout the world, launch our several product initiatives, and even potentially acquire companies.

I’m very excited about this milestone. I always felt – the third time can be a charm. And, I am hoping I can create #3, to be even bigger then my prior 2. With God by my side, I think I may have a great shot at this.

Steve Jobs once said these four words in a speech – and they’ve resonated with me since. “Stay Hungry, Stay Foolish.” To me this means – to never forget where you came from, and most importantly, never forget where you want to go.”

Here’s to another incredible journey…

Gurbaksh Chahal
Founder, Chairman & CEO
gWallet, Inc.

That said, last week was a trying one for the virtual goods industry. First, Anu Shukla of Offerpal and Michael Arrington in this video mixed it up at the Virtual Goods Summit, and then Arrington published several articles exposing the sleazier side of the offer industry.

To us, this disruption is exciting. We entered this space because of its phenomenal growth potential, but we were also attracted by the relative lack of sophistication of our competition. Like all businesses, the offer marketplace revolves around supply and demand. (Supply is applications and virtual worlds that support virtual currency, and demand equals advertisers.) We excel at working with advertisers; we proved this at both ClickAgents (acquired by ValueClick in 2000 for $40 milion) and BlueLithium (acquired by Yahoo in 2007 for $300 million).

When we took a look at the offer business, however, we immediately realized that the demand side of this business is broken. No one is working directly with advertisers to help them understand and appreciate the value of this marketplace. Michael Arrington did a great thing by exposing the weaknesses associated with this model, and his words are starting to wake people up.

Last week I was on a panel at the 80/20 conference with some of my competitors, and I outlined what I think is broken in the industry and how we plan on fixing it.

Here are some of the points I made:

· In order for a marketplace to work, supply and demand need to operate in synch. In the offer business, all of my competitors are sourcing advertisers through affiliate networks. Most of these affiliate networks don’t offer any transparency to the advertiser: the advertiser often doesn’t know where its inventory is appearing, since it’s blended with traffic from other sites. It’s like adding water to soup; it may be palatable, but it’s not as nutritious as the real thing. To be successful, a company like ours needs to work directly with advertisers and agencies and implement tracking that can deliver the best ROI possible. You can’t do this by just rotating affiliate links.

· Over the last ten years, we’ve developed long-lasting relationships with major brands like GM and Anheuser-Busch. That’s why we’ve walked away from many of the shady offers our competitors are working. Over the long-term, you can’t make money by deceiving both consumers and advertisers. It’s just bad karma, and sooner or later, it will bite you in the ass. We’re introducing large advertisers and agencies into this vertical, and to our surprise, none of our competitors have even approached them. It just reminds me how unsophisticated this industry is and why we’re so excited to fix it.

· This system is not good for publishers, either. Sooner or later, when our competitors shun shady offers, there will be a huge price correction in this space. Some developers who are making upwards of $10,000 a day in revenue are in for a rude shock. The funny thing is, many of them already know this. The big players realize that they can’t go public with this kind of suspect revenue, and they are taking aggressive steps to remedy the problem. We applaud companies like Zynga that are saying no to offer scams. It will take longer for smaller players to realize that the high eCPMS to which they have become addicted are ultimately bad for business, but they will realize it soon enough.

· Bringing large brands and agencies into this space requires an extensive amount of education. You have to teach these players how to create value; you have to create specific social media offers that are different from traditional advertising or affiliate network buys. For example, for subscription-based advertisers, we’re designing offers right now in which advertisers pay $X for a new user, and if that user subscribes to their product for Month 2 or Month 3, they receive a residual bounty.

· Technology is not just talk; it is the underlying asset that enables both supply and demand to work in synch. Right now, our competitors are almost openly dismissive about the importance of technology. At the 80/20 conference, for example, the largest competitor in our space declared that “they don’t optimize; they just outperform.” Translation: “Meaning, we have no technology but we’re doing something cosmetic.” If you’re a company like Zynga, is this really the answer you want to hear? This kind of approach provides no scale, long-term sustainability, or value; it’s just a bunch of hand-waving. We’ve learned how important technology is based on my prior two ventures in the ad network space, where technology was the cornerstone to our success.

· We love developers in this space. It’s amazing how social gaming has changed the fundamental business model of a gaming company. And it’s only going to get bigger when the right monetization engine is in place for this marketplace.

I’m a strong believer that the right player with the right platform can create substantial value inside this ecosystem. I remember when I started ClickAgents. We were probably the 30^th ad network to enter the market, but just two years later, we had carved out a leadership role in the marketplace. When I started BlueLithium, we may have been the 300^th ad network, but three and a half years later, we proved that through data and analytics, a startup can create tremendous value.

In conclusion I want to apologize to Michael Arrington for Anu Shukla’s response to his question during her panel discussion at Virtual Goods Summit. When someone challenges you about a legitimate industry issue, you shouldn’t need to resort to verbal abuse or profanity; you should address them in a way that proves your model through logic and reason. Anytime someone uses vulgarity, it shows that you’d rather use noise to make your statement speak louder than your reason. So for that, I’m sorry, Michael, but thank you for waking this industry up.