Weekly Game Investments Update #24

June 8, 2020 — June 14, 2020

Summary

• AT&T is considering a sale of Warner Bros. Interactive Entertainment for the estimated deal size of $2b
• Chinese gaming giant NetEase raised $2.7b in a secondary listing on the Hong Kong Stock Exchange
• Los Angeles-based VR concert startup Wave has raised $30m in a Series B financing round
• Norwegian educational user-generated gaming platform Kahoot has raised $28m for further technical development, business expansion and exploring of acquisition opportunities
• California-based esports entertainment platform BoomTV has raised $10m in Series A funding
• California-based game developer Playable Worlds has raised $10m in Series A funding to develop the cloud-native sandbox MMO game
• Game publisher Kalypso Media has acquired the remaining 40% stake in German PC/console game developer Gaming Minds Studios for an undisclosed sum
• Ireland-based Esports real-money betting platform Luckbox has raised $2.8m as it prepares for an IPO on the TSX Venture Exchange this summer
• Mobile game developer and publisher Animoca Brands has finalised a sale of its mobile games library of 318 titles to Australia-based iCandy Interactive for $3.8m plus an additional payment of $2.3m
• GDC Relief Fund has raised around $290k and distributed funds among 177 game developers
• Zynga and Voodoo have signed partnership agreements with Snapchat to bring their games to Snap Games

AT&T Inc. is considering a sale of Warner Bros. video-game unit

💵 Potential sale
- AT&T is in talks to sell gaming division Warner Bros. Interactive Entertainment (WBIE). The potential deal size may account for $2b
- Activision Blizzard Inc., Electronic Arts Inc. and Take-Two Interactive Software Inc. may be among the potential buyers of the division according to the unidentified insiders
- AT&T acquired WBIE parent Time Warner in 2018 and currently owns rights to many Warner Bros. titles
- The potential transaction may include licensing some of the intellectual properties to a potential buyer, though some of the titles will presumably remain in WB’s possession. Due to this licensing component, WBIE might be able to generate revenue even after the deal

🎲Products
- Over the last 26 years, the company has acquired a number of studios, which scientifically contributed to the WBIE games
- Currently, Warner Bros. Interactive Entertainment owns the following studious: TT Games, Rocksteady Studios, NetherRealm Studios, Monolith Productions, Portkey Games, Avalanche Software, and WB Games studios in Boston, Montreal, New York, San Diego, and San Francisco
- Most popular games include Lego franchise (developed by TT games), Harry Potter game series developed by Electronic Arts, Batman and Scribblenauts franchise
- Lego franchise — a series includes game series based on Warner Bros. movies such as Star Wars, Batman and Jurassic World. The series has sold over 100m copies, making more than $2b for Warner Brothers
- Harry Potter game series based on the famous J.K. Rowling novels, developed by EA UK. The franchise has sold about 40 million, which is $1.5b in sales
- Batman franchise made by Rocksteady Studios. Consisting of four titles it has more than 15m copies sold total.
- Scribblenauts franchise developed by 5th Cell and published by Warner Bros. Interactive Entertainment. The franchise has sold more than 13m copies across multiple platforms

⚙️ About Warner Bros. Interactive Entertainment
- Established in 1993
- Headquarters — Burbank, United States
- Founded by Jim Wuthrich
- Video games publisher, developer, licensor and distributor

NetEase raises $2.7b in Hong Kong IPO

💵 Secondary listing
- Chinese gaming giant NetEase has raised $2.7b after selling its share in a secondary listing on the Hong Kong Stock Exchange
- NetEase is planning several secondary listings on the Hong Kong Stock Exchange. The choice of the platform explained by the intensifying tensions between the U.S. and China
- NetEase primary stock exchange is NASDAQ (listed since 2000)

🎯 Leading Chinese companies started questioning whether they should consider listing in New York because of the latest conflicts and a potential law that can make it much harder to list in the U.S.

⚙️ About NetEase
- Established in 1997
- Headquarters — Hangzhou, China
- Founded by Ding Lei
- Leading PC and mobile game developer and publisher

Wave raises $30m for its virtual concerts platform

💵 Series B financing round
- Los Angeles-based VR concert startup Wave has raised $30m in a Series B round
- Raised funds will be used to create new virtual environments and formats including in-game events and converts. Wave plans to expand into Asian markets, specifically Japan and China
- The round was led by Maveron, with contributions from Griffin Gaming Partners, NTT Docomo Ventures, Avex, Superfly Ventures, Convivialite Ventures, and Raised in Space
-Wave has raised $40m funding up to date with Series A round of $6m in April 2018 and Seed rounds of $4m in April 2017

🎯 VR live concerts are becoming popular. The Wave’s funding news comes just after Epic Games announcement of 27.7m unique players participating in Fortnite’s live concerts with Travis Scott

🎲 Platform
- Wave operates a virtual concert platform which allows to create motion-captured performances of artists turning them into animated characters
- The platform works with labels, managers and artists from the entertainment industries
- To date, Wave has hosted more than 50 events and its shows have reached audiences of up to 400,000 people

⚙️ About WaveVR, Inc. (formerly TheWaveVR)
- Established in 2016
- Headquarters — Los Angeles, United States
- Founded by Aaron Lemke, Adam Arrigo and Finn Staber
- Team of 40+ employees
- Developer of a virtual reality-based concert platform

Kahoot raises $28m through a private placement of shares

💵 Venture Funding
- Norwegian gaming user-generated educational platform Kahoot announced that it has raised $28m in new equity through a private placement of 7.5 million of new shares
- The company plans to spend its latest funding on technical development and exploring of expansion and acquisition opportunities
- In May, Kahoot spent $18m to acquire math app maker DragonBox. Popular e-learning platform plans to continue working on DragonBox’s existing business, as well as to supplement Kahoot’s offering
- To date, Kahoot has raised more than $110m in funding and reached $1.39b in valuation. Among investors are such giants as Disney and Microsoft. Now Kahoot is focusing on partnership with mature edtech businesses

⚙️ About Kahoot
- Established in 2012
- Headquarters — Oslo, Norway
- Team of 120 employees
- Founded by Morten Versvik, Johan Brand, and Jamie Brooker
- Education game-based platform

BoomTV raises $10m for its Esports entertainment platform

💵 Series A financing round
- California-based tournament tool developer BoomTV has raised $10m (oversubscribed) in Series A funding for its esports live streaming platform
- The funds will be used to:
a) update Corde Red ProAm series by increasing prize pools and signing new partnerships with influencers
b) add new features to the esports platform and improve platforms’ UX design and broadcast stability
- The funding round was led by BITKRAFT with participation from other six invertors — Crest Capital, Pole to Win and Crosscut Ventures are among them
- In September 2019, BoomTV has acquired collegiate production company American Video Game League (AVGL). BoomTV currently assists in providing over 1,200 American colleges with esports content
- In December 2016, BoomTV has raised $3.5m of seed funding from Tandem Capital, First Round Capital and Betaworks Ventures at the estimated company’s pre-money valuation of $8m

🎲 Platform
- BoomTV is an Esports entertainment platform that enables organizers to create and manage their own events, as well as provides tools to automate score tracking, streaming, and generating event hubs
- BoomTV is famous for its popular biweekly event series called Code Red with 2.7m unique viewers over the last 12 months
- BoomTV’s most popular games are League of Legends, Fortnite, and Call of Duty: Warzone
- The platform has already covered more than 13k tournaments/events and spent about $3.9m on cash awards
- There are over 75,000 content creators and 1,600 college programs using BoomTV

⚙️ About BoomTV
- Established in 2015
- Headquarters — San Mateo, United States
- Founded by Ha Viet Nguyen and Sumit Gupta
- Team of 24 employees
- Esports live streaming platform

Playable Worlds has raised $10m for cloud-native MMO game

💵 Series A financing round
- California-based game developer Playable Worlds has raised $10m in Series A funding to power the development of its unannounced cloud-native sandbox MMO game
- The funds will be used to enhance the development team with new hires and improve the tech behind its cloud-based game
- The funding round was led by Galaxy Interactive EOS VC fund with participation from BITKRAFT Esports Ventures, which was the lead investor in $2.7m Seed round in October 2019

🎲 Product
- Playable Worlds is developing a sandbox MMO built from the ground up for the cloud
- According to a press release, the unnamed MMO game aims to appeal to a broad range of players by providing a world that supports a range of different playstyles

⚙️ About Playable Worlds, Inc.
- Established in 2018
- Headquarters — San Marcos, United States
- Founded by Raphael Koster, Eric Goldberg and Dorian Ouer
- Online games developer

Kalypso Media fully acquires PC/Console game developer Gaming Minds Studios

💵 Acquisition
- Germany-based game publisher Kalypso Media has acquired the remaining 40% stake in German game developer Gaming Minds Studios for an undisclosed sum. Kalypso has already owned 60% stake in developer
- Gaming Mind Studios was initially created by Kalypso Media and has always been a part of Kalypso Media Group

🎲 Products
- Game publisher Kalypso Media and developer Gaming Minds Studios released several well-known titles together, including Patrician IV, Port Royale 3, Grand Ages: Medieval and Railway Empire
- Port Royale is a famous series of business simulation games, that allows players to control ships in the Caribbean Sea during the 16th and 17th centuries
- Gaming Minds Studios is also known for its tycoon simulation game Railway Empire, that won two awards in The German Developer Innovation Prize 2018 as the best German PC/Console game and The Best German Technical Performance Game

⚙️ About Gaming Minds Studios
- Established in 2009
- Headquarters — Gütersloh, Germany
- Founded by Daniel Dumont and Kay Struve
- Core team is developing games since 1992
- PC and Console video game developer

⚙️ About Kalypso Media Group GmbH
- Established in 2006
- Headquarters — Worms, Germany
- Founded by Simon Hellwig and Stefan Marcinek
- Team of 100 employees with offices in 8 locations in Germany, England and the United States
- PC and Console video game publisher and developer

Luckbox raised $2.8m ahead of public listing

💵 Venture Funding
- Ireland-based Esports real-money betting platform Luckbox has raised $2.8m as it prepares for an IPO on the TSX Venture Exchange this summer
- Luckbox plans to open a second tranche to the funding rouned for potential investors as the current round is oversubscribed. Both rounds are to be led by Gravitas Securities and Beacon Securities

🎲 Platform
- Luckbox facilitates fully licensed real-money betting platform on 13 PC and mobile esports
- Luckbox is similar to Malta-based Esports Entertainment Group (NASDAQ: GMBL)
- Since March 2020, Luckbox has seen a 500% increase in betting volume. Turnover has risen to almost 13 times that seen in November 2019

⚙️ About Real Time Games Holdings Limited (known as Luckbox)
- Established in 2016
- Headquarters — Douglas, Ireland
- Founded by Lars-Kristian Lien and Mike Stevens
- Operator of online gaming and betting esports platform

Animoca Brands sold its mobile games portfolio to iCandy

💵 Asset Deal
- Australia-based mobile game developer and publisher Animoca Brands (GREY: AMOCF) has finalised a sale of its mobile games library of 318 titles to Australia-based iCandy Interactive for $3.8m plus an additional performance-based payment of up to $2.3m
- Animoca Brands will receive a total of 30.2m iCandy shares, increasing its stake in the company from 7.9% to 15.5%
- Under the transaction, Animoca Brands will continue to publish, operate and maintain the games until iCandy would be ready to take over
- Additionally, the management of Animoca Brands and iCandy have agreed to work on the acquired game portfolio and explore future collaboration opportunities

🎬 The story behind
- The acquisition was first announced in November 2017
- In 2019, it was revealed that there were technical issues with a few of the game, so despite iCandy owning the rights, some of the source codes were not transferred to the company
- The delays meant iCandy could not settle a remaining cash consideration of $622k via the issue of new shares to Animoca Brands
- Animoca Brands subsequently agreed to extend the settlement date for the shares and associated maintenance and migration fees

🎲 Products
- The most selling game of Animoca Brands is The Sandbox, which has over 40m downloads and over 1m MAU
- Animoca Brands and iCandy have received 500,000 pre-orders and pre-registrations for a new mobile game based on the MasterChef franchise and developed in partnership with series producer Endemol Shine North America

⚙️ About Animoca Brands (GREY: AMOCF)
- Established in 2006
- Headquarters — Hong Kong, China
- Team of 50+ employees
- Developer and publisher of mobile games

GDC Relief Fund has been distributed among 177 game developers

💵 Funds distribution
- The GDC Relief Fund was established to support developers that have been financially impacted by the cancellation of GDC 2020 due to the coronavirus pandemic
- The fund helps developers who had lost money on non-refundable flights and hotels or would miss out on the crucial business opportunities offered by the conference
- GDC Relief Fund has raised around $290k, out which $150k used to support developers ($700 average payout) and the rest will be used to form Elevate 2020: GDC Relief Fund Accelerator, a 15-week online program that will offer guidance, mentorship and more for indie developers affected by GDC’s cancellation

Both Zynga and Voodoo sign partnership with Snapchat to bring their games to Snap Games

💵 Partnerships
- Zynga and Voodoo have teamed up with Snapchat for a multi-game agreement for the social firm’s gaming platform Snap Games. The platform allows friends to play titles together through the Snapchat social media platform
- The new partnership will allow Voodoo and Zynga to reach Snapchat users

🎲 Platform
- Snap Games had over 100m playing users since its launch in April 2019
- Snap Games allows to attract a lot of new players without any gaming experience