Archives

video gaming

Roblox raises at $29.5 billion valuation, readies for direct listing

Roblox is now one of the world’s most valuable private companies in the world after a monster Series H raise brings the social gaming platform a stratospheric $29.5 billion valuation. The company won’t be private for long, though.

The $520 million raise led by Altimeter Capital and Dragoneer Investment Group is a significant cash influx for Roblox, which had previously raised just over $335 million from investors according to Crunchbase. The Investment Group of Santa Barbara, Warner Music Group, and a number of current investors, also participated in this round.

In February of 2020, the company closed a $150 million Series G led by Andreessen Horowitz which valued the company at $4 billion.

The gaming startup has initially planned an IPO in 2020, but after the major first day pops of DoorDash and Airbnb, the company leadership reconsidered their timeline, according to a report in Axios. Those major say-one share price pops left significant money on the table for the companies selling those shares, an outcome Roblox is likely looking to avoid. Today, the company also announced that it plans to enter the public markets via a direct listing.

Roblox’s 7x valuation multiple signals just how feverish public and private markets are for tech stocks. The valuation also highlights how investors foresee the company benefiting from pandemic trends which pushed more users online and towards social gaming platforms. In a 2019 prospectus, the company shared that it had 17.6 million users, now Roblox claims to have 31 million daily active users on its platform.

Nintendo buys Canadian game studio in rare acquisition

While gaming giants Sony and Microsoft have made M&A a critical part of their strategic growth plans, Nintendo has always seemed to be more reluctant to bring outside talent into the fold of its video game empire. Today, the company announced that it will be acquiring the developer behind Luigi’s Mansion 3, Canada-based Next Level Games.

Nintendo’s announcement is the first studio acquisition for the company since their 2007 purchase of Xenoblade Chronicles developer Monolith Soft.

Next Level Games has been working on Nintendo-licensed IP exclusively for the better part of the last decade, crafting a number of titles across some of the company’s second tier of intellectual property including the Super Mario Strikers series as well as mobile iterations of Metroid Prime and Luigi’s Mansion.

The Vancouver-based studio’s recent Luigi’s Mansion 3 title for the Nintendo Switch has been a pretty huge success for the company which has had pretty light offerings of first-party IP since the system’s launch. In a recent earnings report, Nintendo shared that Luigi’s Mansion 3 had sold nearly 8 million copies, earning it a spot as one of the system’s top-selling titles.

How Niantic evolved Pokémon GO for the year no one could go anywhere

Pokémon GO was created to encourage players to explore the world while coordinating impromptu large group gatherings — activities we’ve all been encouraged to avoid since the pandemic began.

And yet, analysts estimate that 2020 was Pokémon GO’s highest-earning year yet.

By twisting some knobs and tweaking variables, Pokémon GO became much easier to play without leaving the house.

Niantic’s approach to 2020 was full of carefully considered changes, and I’ve highlighted many of their key decisions below.

Consider this something of an addendum to the Niantic EC-1 I wrote last year, where I outlined things like the company’s beginnings as a side project within Google, how Pokémon Go began as an April Fools’ joke and the company’s aim to build the platform that powers the AR headsets of the future.

Hit the brakes

On a press call outlining an update Niantic shipped in November, representatives said the company had tossed out its product roadmap, which included a handful of new features that have yet to see the light of day. They declined to say which features were removed, noting that it just didn’t make sense to release them right now.

Instead, as any potential end date for the pandemic slipped further into the horizon, the team refocused in Q1 2020 on figuring out ways to adapt what already worked and adjust existing gameplay to let players do more while going out less.

Turning the dials

As its name indicates, GO was never meant to be played while sitting at home. John Hanke’s initial vision for Niantic was focused around finding ways to get people outside and playing together; from its very first prototype, Niantic had players running around a city to take over its virtual equivalent block by block. They’d spent nearly a decade building up a database of real-world locations that would act as in-game points meant to encourage exploration and wandering. Years of development effort went into turning Pokémon GO into more and more of a social game, requiring teamwork and sometimes even flash mob-like meetups for its biggest challenges.

Now it all needed to work from the player’s couch.

The earliest changes were those that were easiest for Niantic to make on-the-fly, but they had dramatic impacts on the way the game actually works.

Some of the changes:

  • Doubling the players “radius” for interacting with in-game gyms, landmarks that players can temporarily take over for their in-game team, earning occupants a bit of in-game currency based on how long they maintain control. This change let more gym battles happen from the couch.
  • Increasing spawn points, generally upping the number of Pokémon you could find at home dramatically.
  • Increasing “incense” effectiveness, which allowed players to use a premium item to encourage even more Pokémon to pop up at home. Niantic phased this change out in October, then quietly reintroduced it in late November. Incense would also last twice as long, making it cheaper for players to use.
  • Allowing steps taken indoors (read: on treadmills) to count toward in-game distance challenges.
  • Players would no longer need to walk long distances to earn entry into the online player-versus-player battle system.
  • Your “buddy” Pokémon (a specially designated Pokémon that you can level up Tamagotchi-style for bonus perks) would now bring you more gifts of items you’d need to play. Pre-pandemic, getting these items meant wandering to the nearby “Pokéstop” landmarks.

By twisting some knobs and tweaking variables, Pokémon GO became much easier to play without leaving the house — but, importantly, these changes avoided anything that might break the game while being just as easy to reverse once it became safe to do so.

GO Fest goes virtual