Gaming
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Epic Games acquires Sketchfab, a 3D-model sharing platform
New York-based startup Sketchfab has been acquired by Epic Games, the company behind Fortnite and Unreal Engine. Sketchfab has been building a platform to upload, download, view, share, sell and buy 3D assets. Essentially, it is the leading repository for 3D files on the web.
Epic Games isn’t disclosing the terms of the deal. Sketchfab will still operate as a separate brand and offering. Epic Games also says that all integrations with third-party tools will remain available, including with Unity.
The deal makes a ton of sense as Epic Games has been developing — and acquiring — some of the most popular creation tools. Unreal Engine has been one of the most popular video game engines of the past couple of decades.
More recently, Unreal Engine has been used for different use cases beyond video games, such as special effects, 3D explorations of virtual worlds, mixed reality projects and more.
But an engine without assets is pretty useless. That’s why creators either design their own 2D and 3D assets, outsource this process or buy assets directly. It led to the creation of an entire ecosystem of assets and creators.
Epic Games has its own Unreal Engine marketplace, but Sketchfab has been working on building the definitive 3D marketplace for many years with three important pillars — technology, reach and collaboration.
On the technology front, Sketchfab lets you view 3D models on any platform. The Sketchfab viewer works with all major browsers on both desktop and mobile — you can see an example on Sketchfab. It also works with VR headsets. You can upload 3D models from your favorite 3D modeling app, such as Blender, 3ds Max, Maya, Cinema 4D and Substance Painter.
Sketchfab can also convert any format into glTF and USDZ file formats. Those formats work particularly well on Android and iOS.
When it comes to reach, Sketchfab has grown tremendously over the years. In 2018, the company shared some metrics — 1 billion views, 2 million members and 3 million 3D models. Around the same time, the company launched a store so that creators can buy and sell assets directly on the platform.
Finally, Sketchfab launched an interesting feature for companies that work with 3D models all the time — Sketchfab for Teams. It’s a software-as-a-service play that lets you share a Sketchfab account with the rest of the team. Essentially, it works a bit like a shared Google Drive folder — but for 3D models.
With today’s acquisition, Epic Games is making some immediate changes. Starting today, store fees have been reduced from 30% to 12% — just like on the Epic Games Store. The company lowered commissions on ArtStation immediately after acquiring ArtStation, as well.
As for Sketchfab users paying a monthly subscription fee, everything is a bit cheaper now. All features in the Plus plan are now available for free, all features in the Pro plan are available to Plus subscribers, etc.
“We built Sketchfab with a mission to empower a new era of creativity and provide a service for creators to showcase their work online and make 3D content accessible,” Sketchfab co-founder and CEO Alban Denoyel said in the announcement. “Joining Epic will enable us to accelerate the development of Sketchfab and our powerful online toolset, all while providing an even greater experience for creators. We are proud to work alongside Epic to build the Metaverse and enable creators to take their work even further.”
With the acquisitions of ArtStation and Capturing Reality, Epic Games has been on an acquisition spree. It’s clear that the company wants to build an end-to-end developer suite for the gaming industry.
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Valve launches Steam Deck, a $400 PC gaming portable
A new challenger has emerged in the gaming hardware category. Game distribution giant Valve today announced the launch of Steam Deck, a $399 gaming portable designed to take PC games on the go.
The handheld (which has echoes of several portable gaming rigs of years past) features a seven-inch screen and runs on a quad-core Zen 2 CPU, coupled with AMD RDNA 2 graphics and 16GB of RAM. Storage runs 64GB to 512GB, the latter of which bumps the price up to $649. The built-in storage can be augmented via microSD.
Image Credits: Valve
Naturally, the thing is custom built for Valve’s wildly popular Steam platform (it’s right there in the name, after all). Users log into their Steam account and their library — and friends list — are right there, ready to go. There’s even a dedicated Steam button.
The system has been rumored for some time now, but it enters the world during a rapidly evolving era for gaming. Essentially the company is hoping to outperform the admitted graphical limitations of Nintendo’s Switch (OLED or no), while filling in the gap as cloud-based gaming from companies like Microsoft are still working on a foothold as they deal with latency and other technical limitations. There’s also the Nvidia Shield Portable — though we’ve not heard much from that project, of late.
Image Credits: Valve
Flanking the 1280 x 800 touchscreen are a pair of trackpads and thumb sticks. A built-in gyroscope also uses movement to control the gaming experience. There’s a single USB-C port for charging, peripherals and connecting to a big screen, while a 40Wh battery promises between 7-8 hours of gameplay, by Valve’s numbers.
Image Credits: Valve
The system is up for preorder now and starts shipping this December, in time for the holidays.
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Play2Pay raises $13M to convert mobile user engagement into bill payment
The gamification of payments is not a new concept.
A number of companies are attempting to combine gamification and payments in creative ways. And today, one such company, Play2Pay, has raised $13 million in a Series A round of funding.
The Miami-based startup has a straightforward mission. It wants to give consumers a way to reduce their bills — it claims by an average of 30%! — by playing games, watching videos and completing daily challenges, offers and surveys.
Play2Pay was bootstrapped for the first five years of its life, raising its first external capital in June of 2020 — a $7.5 million seed round from individual angel investors. Telesoft Partners led its Series A round, which included participation from Harbor Spring Capital and individual investors including former AT&T vice chairman Ralph de la Vega, former Reuters CEO Tom Glocer, Madison Dearborn Partners co-founder and senior advisor Jim Perry and Virtusa founder and former CEO, Kris Canekeratne.
The alternative payment platform says it brokers a “value exchange” between brands and consumers, converting attention and engagement into a currency, which can be redeemed for bill payment. Meanwhile, brands get a new way to promote their products and services.
Play2Pay founder and CEO Brian Boroff started the company in 2015 based on a vision that prepaid mobile phone users should have an alternative way to pay for their mobile phone service and that wireless carriers would adopt an ad-funded commercial model.
Today, the company claims to be positioned to be the world’s first “ad supported payment rail” directly integrated into payments platforms of major service providers and financial institutions. It also claims to be the only company that converts user engagement directly into bill payment.
Image Credits: Play2Pay
The “opt-in” offering is currently available to more than 100 million mobile subscribers across the United States, United Kingdom, Mexico, Brazil and Indonesia through partnerships with telecom companies such as AT&T Mexico, Cricket in the U.S., TIM in Brazil, lndosat Ooredoo in Indonesia and U.K.-based Lycamobile.
The rewarding approach seems to be resonating with users. From June 2020 to June 2021, the startup saw its ARR (annual recurring revenue) spike by nearly 300%, according to Boroff, a telecom veteran.
Among the users engaged on the platform, about 25% generated revenue daily, he said. And service providers realized up to 17% revenue expansion as a result of subscriber engagement on the Play2Pay platform, according to Boroff.
“Our distribution model is B2B2C, with Tier-1 service providers worldwide directly integrating our bill payment capability. We’re growing our audience through promotion of the service to their customer base,” he told TechCrunch.
End users, he added, can share their targeting preferences in exchange for value, giving mobile app developers and brands more information when promoting their own products and services to Play2Pay’s audience.
The platform is free for service providers and merchants, meaning the payment does not have costs or fees from interchange, acquirers, chargebacks or gateways.
Instead, Play2Pay generates revenue from mobile app developers and brands. Those developers and brands pay to access Play2Pay’s mobile audience in order to promote their products and services. For example, a mobile gaming company might pay Play2Pay $100 for every user that downloads their app from the Play2Pay app and plays the game for a period of time (such as two hours). Through its technology and partner network, Play2Pay has attribution tracking to ensure that the end user and mobile gaming company both know how much progress has been made toward completing that goal. Other formats include watching videos, completing surveys and more conventional native advertising in some areas.
All of this revenue is aggregated by Play2Pay, the majority of which is passed on to the end user in the form of in-app currency. The balance goes to service providers such as its wireless carrier partners for promoting the Play2Pay platform and to Play2Pay for running the service and processing payment. Play2Pay collects all of the cash and pays out the various parties accordingly.
The company will use the new capital toward product development, hiring and partner engagement.
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Cadoo gets $1.5M to gamify fitness with betting challenges
Cadoo, a US-startup that’s gamifying fitness by turning it into a betting opportunity, using the prospect of winning (or losing) cold hard cash to motivate people to get off the couch, has collected $1.5 million in seed funds from Sam & Max Altman’s Apollo VC and the student-focused Dorm Room Fund.
The app itself has been around since 2018 but in March 2020 it launched a “challenge model” that lets users stake money to join a challenge related to a specific fitness goal — be it running 10 miles in 10 days, or walking three miles in three days.
Participants who achieve the challenge goal get their stake back and a pro-rata share of losers’ staked entry fees.
A range of fitness levels are catered to by Cadoo’s challenges (“from daily steps to marathon training”), with some 50 public challenges hosted per week.
It’s also adding private challenges this month — which will enable users to host and configure fitness challenges for themselves/family and friends, or larger groups, such as companies, clubs, or schools.
Challenge-related activity is verified by the app via API data from activity trackers and fitness apps. (Which hopefully means Cadoo is smart enough to detect if someone has attached their Fitbit to their dog… )
The app has support for a number of third party fitness services, including Strava, Fitbit and Apple Health.
CEO and founder Colm Hayden describes the startup as “DraftKings for your own fitness goals”.
“Our audience consists of 25-50 year old fitness fanatics’ who use Cadoo to stay committed to their monthly/weekly fitness goals,” he told TechCrunch, adding: “When people are serious about a goal they are trying to reach, they want intense motivation to back their ambitions.”
He says the app has attracted around 7,000 wager-loving users so far.
Cadoo’s business model is based on taking a fee from challenge losers before their entry fee stakes are distributed to challenge winners — which does potentially give the business an incentive to set harder challenges than users are able to complete.
But of course it’s up to users to pick which challenges to enter and thereby commit their hard earned cash to.
It also claims that 90% of users who sign up for Cadoo challenges successfully complete them.
Hayden says it has future plans to expand monetization potential by offering winners fitness products — and taking a margin on those products. And also by expanding into other types of verifiable goals, not just running/walking.
“We are working to build a motivation platform that enables anybody to reach their goals,” he says. “Financial incentives is an intense motivator, and 90% of users who sign up for Cadoo challenges reach their fitness goals. We are making Cadoo much bigger than just running goals, and in the future incentivizing almost any goal verifiable on the internet.”
While the app is US-based payments are processed by PayPal and Hayden says it’s able to support participation internationally — at least everywhere where PayPal is available.
Commenting on the seed raise in a statement, Apollo VC’s Altman brothers added: “Cadoo makes it easy to motivate users to stay active with financial incentives. We believe the motivation industry that Cadoo is pioneering will be an important digital money use-case.”
Before the seed round, Cadoo says it had raised $350,000 via an angel round from Tim Parsa’s Cloud Money Ventures Angel Syndicate, Wintech Ventures, and Daniel Gross’s Pioneer.
Of course gamification of health is nothing new — given the data-fuelled quantification and goal-based motivation that’s been going on around fitness for years, fuelled by wearables that make it trivially easy to track steps, distances, calories burned etc.
But injecting money into the mix adds another competitive layer that may be helpful for motivating a certain type of person to get or stay fit.
Cadoo isn’t the only fitness-focused startup to be taking this tack, either, though — with a number of apps that pay users to lose weight or otherwise be active (albeit, sometimes less directly by paying them in digital currency that can be exchanged for ‘rewards’). Others in the space include the likes of HealthyWage (a TC50 company we covered all the way back in 2009!); Runtopia and StepBet, to name a few.
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Nigeria leads mobile app market growth in Africa as use of gaming apps surge 44% from Q1 2020
The pandemic’s effect on the global app market has not been hard to miss. In the first quarter and first half of this year, consumer spending in mobile apps hit new records at $32 billion and $64.9 billion, respectively.
In Africa, it can be tough to call out exact numbers on consumer spending because the continent gets hardly a mention in global app market reports. Yet, other metrics are worth looking at, and a new report from AppsFlyer in collaboration with Google has some important insights into how the African app market has fared since the pandemic broke out last year.
The report tracked mobile app activities across three of Africa’s largest app markets (Kenya, Nigeria and South Africa) between Q1 2020 and Q1 2021.
From the first half of 2020 to the first half of 2021, the African mobile app industry (which is predominantly Android) increased by 41% in overall installs. This was analyzed from 6,000 apps and 2 billion installs in the three markets. Nigeria registered the highest growth, with a 43% rise; South Africa’s market increased by 37% and Kenya increased 29%.
Lockdown numbers
On March 22, 2020, Rwanda imposed Africa’s first lockdown. Subsequently, other countries followed; (those in the report) Kenya (March 25), South Africa (March 27), and Nigeria (March 30).
As more people spent time at home from Q2 2020, app installs increased by 20% across the three countries. South Africans were the quickest to take to their phones as the lockdowns hit with installs increasing by 17% from the previous quarter.
On the other hand, Nigerians and Kenyans recorded a 2% and 9% increase, respectively. The report attributes the disparity to the varying levels of restrictions each country faced; South Africa experienced the strictest and most frequent.
Per the report, gaming apps showed strong performance between Q1 and Q2 2020. The segment experienced a 50% growth compared to an 8% increase in nongaming apps pulled. It followed a global trend where gaming apps surged to a record high in Q2 2020, at 14 billion downloads globally.
In-app purchasing revenue and almost year-on-year growth
According to AppsFlyer, the biggest trend it noticed was in in-app purchasing revenue. In Q3 2020, in-app purchasing revenue numbers grew with a staggering 136% increase compared to Q2 2020, and accounted for 33% of 2020’s total revenue, “highlighting just how much African consumers were spending within apps, from retail purchases to gaming upgrades.”
In-app purchasing revenue among South African consumers increased by 213%, while Nigeria and Kenyan consumers recorded 141% and 74% increases, respectively.
On the advertising front and on an almost year-on-year basis, in-app advertising revenue also increased significantly as Africans were glued to their smartphones more than ever. Per the report, in-app advertising revenue increased 167% between Q2 2020 to Q1 2021.
For gaming and non-gaming apps, which was highlighted between the first two quarters, they both increased by 44% and 40% respectively in Q1 2021 compared to Q2 2020.
Fintech and super apps
In the last five years, fintech has dominated VC investments in African startups. It’s a no brainer why there is so much affinity for the sector. Fintechs create so much value for Africa’s mobile-first population, with large sections of unbanked, underbanked and banked people. This value is why all but one of the continent’s billion-dollar startups are fintech.
African fintechs have grown by 89.4% between 2017 and 2021, according to a Disrupt Africa report. Now, there are more than 570 startups on the continent. Many fintechs are mobile-based, therefore reflecting the number of fintech apps Africans use each day. Consumers in South Africa and Nigeria saw year-on-year growth in finance app installs by 116% and 60%, respectively.
AppsFlyer says that like fintech apps, super apps are on the rise as well. These “all-in-one” apps offer users a range of functions such as banking, messaging, shopping and ride-hailing. The report says their rise, partly due to device limitations on the continent, owes much to the same conditions that have led to a surge in fintech apps: systemic underbanking.
“Super apps remove some of the barriers that these users face, as well as providing a level of customer insight and experience that traditional banks cannot,” the report said.
Daniel Junowicz, RVP EMEA & Strategic Projects for AppsFlyer, commenting on the trends highlighted in the report said, “…The mobile app space in Africa is thriving despite the turmoil of last year. Installs are growing, and consumers are spending more money than ever before, highlighting just how important mobile can be for businesses when it comes to driving revenue.”
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Android 12 will let you play games before they finish downloading
At its Game Developer Summit, Google today announced a new feature for Android game developers that will speed up by almost 2x the time from starting a download in the Google Play store to the game launching — at least on Android 12 devices. The name of the new feature, “play as you download,” pretty much gives away what this is all about. Even before all the game’s assets have been downloaded, players will be able to get going.
On average, modern games are likely the largest apps you’ll ever download, and when that download takes a couple of minutes, you may have long moved on to the next TikTok session before the game is ever ready to play. With this new feature, Google promises that it’ll take only half the time to jump into a game that weighs in at 400MB or so. If you’re a console gamer, this whole concept will also feel familiar, given that Sony pretty much does the same thing for PlayStation games.
Now, this isn’t Google’s first attempt at making games load faster. With “Google Play Instant,” the company already offers a related feature that allows gamers to immediately start a game from the Play Store. The idea there, though, is to completely do away with the install process and give potential players an opportunity to try out a new game right away.
Like Play Instant, the new “play as you download” feature is powered by Google’s Android App Bundle format, which is, for the most part, replacing the old APK standard
Image Credits: Google
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Can advertising scale in VR?
One of VR’s prospective revenue streams is ad placement. The thought is that its levels of immersion can engender high engagement with various flavors of display ads. Think billboards in a virtual streetscape or sporting venue. Art imitates life, and all that.
This topic reemerged recently in the wake of Facebook’s experimental ads in Blaston VR. As TechCrunch’s Lucas Matney observed, it didn’t go too well. The move triggered a resounding backlash, followed by the game publisher, Resolution Games, backing out of the trial.
This chain of events underscored Facebook’s headwinds in VR ad monetization, which stem from its broader ad issues. In fairness, this was an experimental move to test the VR advertising waters … which Facebook accomplished, though it didn’t get the result it wanted.
VR advertising is a bit of a double-edged sword. It could take several years for VR usage to reach requisite levels for meaningful ad monetization.
Regardless, we’ve taken this opportunity to revisit our ongoing analysis and market sizing of VR advertising in general. The short version: There are pros and cons on both qualitative and quantitative levels.
The pros of VR advertising
VR advertising’s opportunity goes back to factors noted above: potentially high ad engagement given inherent levels of immersion. On that measure, VR exceeds all other media, which can mean higher-quality impressions, brand recall and other common display-ad metrics.
Historical evidence also suggests that VR could follow a path toward ad monetization. VR shows similar patterns to media that were increasingly ad supported as they matured. These include video, social media, mobile apps and games (just ask Unity).
To put some numbers behind that, 75% of apps in the Apple App Store’s first year were paid apps — similar to VR today. That figure declined to 15% in 2014 and hovers around 10% today. Over time, developers learned they could reach scale through free downloads.
Prevalent revenue models today include in-app purchases — especially in mobile gaming — and advertising. The question is whether VR will follow a similar path as developers learn that they can reach scale faster through free apps that employ “back-end monetization” like ad support.
This trend also follows audience dynamics: Early adopters are more likely to pay for content and experiences. But as a given technology or media matures, its transition to mainstream audiences requires different business models with less upfront commitment and friction.
“Today, there are only about 18% of applications in VR stores such as Steam and Oculus that are free,” Admix CEO Samuel Huber said. “This is fine for now because we are still very early in the market and most of these users are early adopters. They are willing to pay for content, just like they were willing to pay for prototype unproven hardware and generally, they have higher purchasing power than the average person.”
Drawbacks of VR advertising
Considering the above advantages, VR advertising is a bit of a double-edged sword (or beat saber). Those advantages are counterbalanced by a few practical disadvantages in the medium’s early stage. Much of this comes down to the requirement for scale.
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Roblox partners with Sony Music to connect artists with money-making activities in the metaverse
Video game platform Roblox announced this morning it has partnered with Sony Music Entertainment on a deal that will allow the two companies to work together to create music experiences for the Roblox community, including opportunities that would give Sony Music artists a way to reach new audiences and generate revenue.
The announcement follows last month’s news of a $200 million lawsuit filed by a group of music publishers who alleged Roblox was allowing creators to build virtual boomboxes inside their games that streamed copyrighted music without artists’ permission or any payment.
The publishers in the lawsuit included Universal Music Publishing, Big Machine Records, Concord Music Group, Downtown Music Publishing, Kobalt Music Group and Hipgnosis Songs Fund. Roblox responded to the litigation by saying it was “surprised and disappointed” by the action, which represented a “fundamental misunderstanding of how the Roblox platform operates.”
It claimed it doesn’t tolerate copyright infringement and uses filtering technology to prohibit unauthorized recordings. It also said it responds to valid Digital Millennium Copyright Act (DMCA) takedown requests by removing any infringing content.
However, the company’s deal with Sony Music indicates Roblox is aware of the value in partnering in a more official capacity with a music company.
Roblox didn’t fully detail what sort of “commercial activities” it has in mind for Sony Music artists and their fans, but it had worked with the music company on past events, including its first-ever virtual concert with Lil Nas X in November 2020, and this May, a virtual Zara Larsson Launch Party. The concert was attended by over 36 million players, while the launch party attracted over 4 million visits — the highest for any launch party on Roblox to date.
The Roblox platform, generally speaking, allows artists to reach fans through a variety of activities, including virtual concerts, merchandise sales, and other integrated in-game activities. We understand the agreement will not include access by Roblox developers to Sony Music Entertainment artists’ recordings, however.
“Sony Music artists have been at the forefront of engaging the millions of music fans in Roblox’s massive user community with forward-looking initiatives like Lil Nas X’s industry-first virtual performance on the platform, and Zara Larsson’s recent listening party event,” said Sony Music Entertainment President of Global Digital Business and U.S. Sales, Dennis Kooker, in a statement. “With this new agreement, we look forward to expanding our successful partnership with the Roblox team to further unlock commercial opportunities at the intersection of music and gaming. Immersive online environments represent a meaningful opportunity for reaching a growing number of fans who want to use virtual communities to enjoy shared music experiences,” he added.
The deal comes at a time when Roblox’s audience is aging up. the company in its Q1 2021 earnings reported a 128% increase in engagement from users over the age of 13 — a time when music is becoming a more important part of young people’s lives and they’re interested in connecting more directly with favorite artists. The gaming company’s daily active users also grew 79% to reach 42.1 million during the quarter while revenue climbed 140% to $387 million.
“Sony Music has been a fantastic partner and I am pleased to deepen and lengthen our relationship. They truly understand the massive opportunity that the metaverse presents for their artists, and we are committed to helping them unlock new creative and commercial opportunities on Roblox,” said Jon Vlassopulos, Vice President and Global Head of Music at Roblox.
This is not Roblox’s first music label partnership. Last month, the company announced a similar deal with BMG, also focused on future collaborations and revenue-generating opportunities for artists and songwriters.
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Nintendo’s OLED Switch arrives October 8, priced at $350
So much for the big E3 reveal. Weeks after the big gaming show, Nintendo has finally taken the wraps off the latest iteration of its wildly popular hybrid gaming console. The Nintendo Switch (OLED model) [parentheses theirs] will arrive on October 8, priced at $350. That is, the company’s quick to note, the same day it launches Metroid Dread, the long-awaited latest side scrolling entry in the long-standing franchise.
The system sports a 7-inch OLED, improved audio and 64 GB of internal storage. The hybrid dock sports a wired LAN port, and the system ships with an adjustable port for playing in tabletop mode. There’s a sharp black and white color scheme, though the remainder of the materials looks to be similar to the earlier model, with most of that price bump going to the display. The company will also be offering a separate carrying case, because you don’t want to get the fancy screen on your new $350 system scratched.
From the sound of it, the two existing Switch models are sticking around as lower-cost alternatives. Those models run $299 and $199, respectively, though it seems reasonable to expect there may be some price drops as the new model arrives ahead of the holidays.
“The new Nintendo Switch (OLED model) is a great option for players who want to experience the new vibrant screen when playing in handheld and tabletop mode,” Nintendo of America President Doug Bowser said in a press release. “With the addition of this new model to the Nintendo Switch family of systems, people have an additional choice of a system that best fits the gaming experience they desire – whether it’s Nintendo Switch (OLED model), Nintendo Switch or Nintendo Switch Lite.”
The system will arrive in two color configurations. Per Nintendo:
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Nintendo Switch (OLED model) white set, which features white Joy-Con controllers, a black main unit and a white dock.
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Nintendo Switch (OLED model) neon red/neon blue set, which features neon red and neon blue Joy-Con controllers, a black main unit and a black dock.
An upgraded version of the four-year-old system has been rumored for some time, carrying the decidedly less clunky name, Switch Pro. With both Sony and Microsoft releasing next-gen versions of their consoles last year, the time certainly seemed right for a big refresh from Nintendo. A refreshed version of the standard Switch arrived in July 2019, addressing the original’s poor battery life — far and away the largest complaint of an otherwise well-received system.
Image Credits: Nintendo
Of course, in spite of growing a bit long in the tooth, the Switch continued to dominate the sales charts ahead of the arrival of the PlayStation 5 and Xbox One X. Nintendo utterly dominated sales during the pandemic, after some initial supply chain shortages. That success was due in no small part to the arrival of a new Animal Crossing title that provided some much-needed social gaming during the pandemic. Such success — coupled with potential supply chain shortage — led to suggestions that the company had opted to delay the system’s release.
In spite of the lack of new hardware, last month’s E3 did see some big game news from Nintendo, before just a new Metroid. Far and away, the most eagerly anticipated is 2022’s sequel to Breath of the Wild, one of the most beloved entries in the Zelda series and easily one of the Switch’s best titles.
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Swedish gaming firm MTG acquires India’s PlaySimple for $360 million
Swedish gaming giant Modern Times Group (MTG) has acquired Indian startup PlaySimple for at least $360 million, the two firms said Friday.
MTG said it will pay 77% of the acquisition sum to Indian game developer and publisher in cash and the rest in company shares. There’s also another $150 million reward put aside if certain undisclosed performance metrics are hit, the two firms said.
Friday’s deal marks one of the largest exits in the Indian startup ecosystem. PlaySimple had raised $4 million Series A at a valuation of about $16 million from Elevation Capital and Chiratae Ventures in 2016. (The startup, which began its journey in Bangalore, raised just $4.5 million in total from external investors.)
And it’s clear why: the revenues of PlaySimple — which operates nine word games including “Daily Themed Crossword,” “Word Trip,” “Word Jam,” and “Word Wars” — grew by 144% y-o-y to $83 million last year and it was on track to hit over $60 million revenue in the first half of 2021.
Cap table of PlaySimple after Series A in 2016.
“We’re very proud of the games we’ve developed over the years, and of the infrastructure and scale that we’ve achieved with our team,” said PlaySimple co-founders and management team members — Siddhanth Jain, Suraj Nalin and Preeti Reddy — in a joint statement.
“As we join the MTG family, we look forward to leveraging our proprietary technology across MTG’s gaming portfolio, expanding into the European market, investing in cutting-edge technology and building exciting new games.”
PlaySimple, which says its free-to-play games have amassed over 75 million installs and maintain nearly 2 million daily active users, plans to launch a number of games later this year and also expand into the card games genre.
“PlaySimple is a rapidly growing and highly profitable games studio that quickly has established itself as one of the leading global developers of free-to-play word games, an exciting new genre for MTG,” said Maria Redin, MTG Group President and CEO, said in a statement.
The Stockholm-headquartered firm, which has also acquired Hutch and Ninja Kiwi in recent quarters, said PlaySimple will help it build a diversified gaming vertical. “Scaling and diversifying the GamingCo [an MTG subsidiary] helps to accelerate the operational performance while at the same time creating a more stable business,” the firm said.
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