Taking the Games Trading Business Online – An Interview with LeapTrade’s Tony Caputo

Recently, Gamer Living sat down with LeapTrade’s Tony Caputo about his innovative site that allows gamers to trade their games with other players online and by mail – http://www.leaptrade.com.

Will: So, Tony, number one, thanks for doing this interview with me and sitting down a little bit to talk about Leap Trade. Just real quick, before we get into what Leap Trade is and what’s it about, why don’t we talk about you for a minute. What do you do at Leap Trade, and what brought you to this idea?

Tony: Sure. Will, thanks for having me. I’m the president of Leap Trade. And what I do for Leap Trade – is a number of things, a lot of the —  As you can imagine – the presidential stuff, organizing the projects and overseeing things and making sure that the vision is on track, and all that kinda good stuff. My background is a little bit technical. I’ve been in software engineering pretty much my whole life; I’ve been a gamer my whole life. So, a lot of genesis of Leap Trade starts back there, you know, where getting/trading cheap games to each other for a lot less than anywhere else is sort of married with technology and we had a baby that was Leap Trade. So that’s kind of how it all started, that idea of thinking about how can we do this better, how can do it with more community involvement, and how can we make it more fun than anywhere else?

Will: Awesome! So, Leap Trade – I surfed the website a little bit and grabbed an account and started playing around with some of the settings and everything.  But, at the root, it’s really just kind of a… would you describe it like a mail-order kind of trade system with other gamers? What’s the best way to describe how Leap Trade works?

Tony: Yeah, if I were to put Leap Trade into a nutshell, what we are is kind of what you said: we’re a used games trading site that allows players to trade with other players in a secure environment. So, we do this by sending packages in the mail to each other. We have a system where trades are $3.49 to ship; we like to print the label and when you receive a game through Leap Trade from another player, it’s always completely free. The shipping is free when it comes that way; the person shipping is the one who plays. And then, in addition to being able to trade for getting Leap Trade points, you can go ahead and […] get games by using your Leap Trade points. We also offer Instant Trades, which are straight game-to-game trades; and we offer Friend-to-Friend trading, which is a way for you to trade in your network group of friends, so you can wheel and deal with people you know, just to give you maximum flexibility with those three ways. And I’ll touch on the US thing real quick. Right now we use the US postal service for all of our label-printing, so it’s easy to say that within the US it’s always $3.49, and we track through the US postal service and everything’s right there on Leap Trade, you can see where your packages come from. But unfortunately once you cross the border into Canada, or anywhere else for the matter, it’s different. So, a lot of very different prices in different systems. We are starting out and focusing on the US right now, but we are definitely keeping our eyes on other places, especially our neighbors right to the North.

Will: ok. So with the kind of business model that goes with video games today; gamers go to retailers nowadays and they trade their video games in for essentially a monetary equivalent in credit to go towards newly purchased videogames. So my question is, with retailers putting a monetary value towards trading to get other games, how do you compete with that with Leap Trade? Obviously, you can trade the games back and forth, but how do you present the value to the gamer?

Tony: Yeah, that’s a great question. Like I was mentioning before about Leaptrade points, we assign a value to every single game on the site, so we have over 10,000 games in our game library and they all have leaptrade points assigned to them. When you look at it, you know the value of what you’re looking to trade or looking to get, and the way we do this is we have an outside service that takes […] the monetary value from online retails, and some brick and mortar, and some auction sites – all sorts of places — and brings back the true value of the game, what you could sell it for if you were trying to sell it yourself somewhere, or if you were to buy it somewhere else like an online retailer or brick and mortar.  We do that so you always get the fair value; it’s not like you could get fleeced out of the value of your game, by “aww, I wanted it for $10” sort of thing, we always set one price. and what we do… the big difference between us and a retailer, like you mentioned, where you trade your game in for credit; with us, when you trade in a game, there’s one price. It’s not like I trade it in for the trade-in price that’s about half or less of the price I’m gonna be able to buy the used game back. So, if you go in, my game is $30 on the shelf, they might give me $10 or $15; for us, the equivalent is when you trade in a game, you get it for $30, and you send it in for $30. It’s always the same. It’s because you’re trading directly with other gamers, we don’t have the same kind of –

Will: profit model.

Tony: — yeah, exactly!  It’s totally a different thing; it’s about creating that community; if we trade among ourselves to play more games, rather than what the trailers are doing.

Will: ok. So I see on the site tha tyou’ve got pretty much all of the modern consoles, including Xbox One, PS4, Wii U, , Xbox 360. But I also saw that you’ve got a PC section. With PCs, the media tends to be associated with a serialized account number or a serial number that comes on the box; […] do you run into a lot of restrictions because of that, or is the focus a bit more narrow with PC gaming versus the console gaming?

Tony: it depends… on where you got the game from. If you know, if you bought the game in a physical version of it, you got a box, then that’s the best way to have it, because it’s yours, it’s in your hand and you can do with it whatever you want.  If there are other ways, if you bought it digitally or some other things that can be a little trickier, there are still things you can do there a lot of the times, but you just need to make sure that when you trade something that this is tradeable.  And that’s what we try to do on the site, we have all the games that you can trade with other people that’s on there for you to see. If you downloaded something that’s stuck to your PC or that kind of thing, then we don’t offer it right there. But you can definitely trade PC –  people trade PC games all of the time.

Will: awesome! So how big is your user base currently, and how much has it grown since you launched Leap Trade?

Tony: yeah we were in Beta just at the very end of last year, and we’ve been working very hard on the site and just had a more of a closed Beta atmosphere where we were refining. And we recently came out of Beta, and we’re growing very quickly now.  And we have about 2000 games available. So if you went on there right now and were looking for a game, there’s a big number out there – huge number that you can get right away from people looking to trade them. So there’s a lot of excitement building right now.

Will: awesome! What’s the biggest challenge that you’ve faced with putting a site like this together? I’m sure with, not necessarily DMCA because that wouldn’t apply, but with Fair Use laws and everything, how much research did you have to go into when looking at the legality of this before you actually moved forward with the project?

Tony: yeah, that’s always a little bit of a sticky area. But there’s been so much precedent for that already. All previous consoles that are out there already,  the 360 – that era from the PS3 – and all before that, pretty much back to Atari and everything else – they’re all fair game. There’s no restrictions on that. People can trade, people can swap; people can do that without any restrictions. What’s great is that with the currenet consoles that came out, the Wii U, Xbox One, PS4, are all allowing used games and trading. So it’s looking great for us. In the future, we hope that digital will be more tradeable as well. They’re already making inroads with that, I know, with some friends and family traiding, and things like that. So our hope is that Fair Use rules the day, and we can be trading on Leap Trade 50 years from now – on whatever kind of Xbox, you know 17, that we’re playing holographic imaging and all that (laughs).

Will: (chuckles) wlel you make up a good point with the future technology and the concerns about building the ability for users to be able to trade or resell their future technologies coming up with the advent of digitial and everything; but going further backward, I know that there’s been a resurgence of smaller shops offering the more retro gaming as well. I see that you have the PS2 and Gamecube, but have you considered possibly expanding it into the SNES or NES and some of the legacy consoles that are still very popular for collectors?

Tony: yeah definitely. Some of those systems are what we grew up on, you know genesis and sega master systems and all those kind of things. And we definitely – that’s on our list of thigns to do, to get into the more retro area. As you know, It’s a little trickier pricing wise, and we are making sure that we do it in a careful and good way of making sure that you don’t have prices all over the place, and it’s useable.  We see some sites where people want ridiculously high or ridiculously low amounts for them., and so it makes it tougher to price them out. But our service goes back into some of those older games too. So we definitely want to do that in the future, that’s on our radar for sure. Because you’re right, it’s fun to look back to what you did in the past and what you did when you were younger.

Will: Awesome! So are you looking at the possibility of creating partnerships with any types of distributors to build some additional mass into this, or is this going to be solely gamer-based. I guess what I’m getting at is how far, how big, do you honestly see the population of potential traders getting? How much interest are you seeing in this product of yours?

Tony: That’s a great question! We’re seeing a lot of interest. Everbody we tell the idea to is like “great, let me sign up!” Just thinking about how many gamers are out there… the numbers kind be pretty staggering. When we were investigating the project and looking into.. .there’s a 100 million households in the United States alone that have a console, and as you progress into newer and newer generations, those old consoles go somewhere — you give it to your younger cousin or something, your old Wii or whatever it is. It could be huge, you know, when you look at just how big the used game market – in the billions – and how much people are paying when they go to a retailer and how much value they‘re losing on their games. The opportunity for us, it’s just exciting to think about how much gamers could save, how much more they can play games, and how much people can be a part of Leap Trade in the future.

Will: Excellent. Alright, well… fantastic! Well I think that just about wraps up all of the questions I had for you.

Tony: Ok!

Dave: Tony, did you get a chancre to talk about Alpha Strike?

Tony: yeah, I was just about to get into that. We have a.. this may get a little bit into last question. What we’re doing is that we have is a fantastic promotion coming up in December called Alpha Strike. So what we’re doing is – of course everyone wants to play all of PS4 [and] Xbox One games, all that new great stuff. The problem is how many people are going to want to trade those out right away, unless they’ve got two copies of it or something? You know, youw ant to play your game. What we’re going to do is, our users can take their old games (any of the current systems – anything that we have on our site), they can trade them in for Leap Trade points, and then what we’re going to do is we’re actually going to go out and purchase PS4 and Xbox One games, and they can trade their points to us directly, and we’ll send out brand new copies of PS4 and Xbox One games.  Just as an exciting promotion for the holidays and into January to get people off their old consoles. A way to get in, put away the old stuff they’re done with, send it to someone who really wants it, and then get to play with all the great new stuff.

Will: That is pretty awesome.

Tony: yeah, we’re pretty excited.

Will: That is very cool! So, when does this promotion start?

Tony: We’re going to be starting it in mid-December. So, keep a look out, and we’ll be in touch and we’ll let you know once that launches. And people can go in right now even before the official promotion starts, and build up their points on Leap Trade. So when we drop the hammer on the promotion, and the gates are open, they can start requesting all of the next gen games, and just really take off.

Will: That’s fantastic! Really, that’s a really, really good promotion. Well thank you very much!

Tony: Great! Well thanks a lot, I really appreciate it!