The Los Angeles-based mobile game development studio Scopely has become America’s newest unicorn thanks to a $200 million financing, which values the company at a whopping $1.7 billion.
Scopely said it would use the capital to continue its strategy of developing and acquiring new games as it looks to continue its run of six consecutive mobile games that will gross $100 million or more in lifetime revenue.
The new investment follows Scopely’s milestone of achieving more than $1 billion in lifetime revenue. Games in the company’s portfolio include: Looney Tunes World of Mayhem and Star Trek Fleet Command, created with the recently acquired DIGIT Game Studios.
Indeed, part of the reason for the financing is to accelerate the pace of its acquisitions and investments into new game development studios, according to chief executive Walter Driver.
“The barrier to entry from independent studios is to find product-market fit,” says Driver. “Increasingly, it’s helpful for them to have publishing capabilities that are more global in nature and more scaled.”
The unicorn gaming company has amassed increasingly larger rounds over the past three years on a nearly annual basis. The company raised a $55 million round of financing in 2016, $60 million in 2017 and $100 million in 2018.
For investors, what makes the company compelling (beyond its string of successful games) is the technology platform that undergirds its popular mobile gaming titles. “What the company allows you to do is look at engagement and alter a game midstream to tailor the experience,” says Ravi Viswanathan, the founder and managing partner of NewView Capital.
NewView, a growth-stage venture capital firm spun out of the multibillion-dollar investment firm NEA, led the most recent $200 million round for Scopely.
Scopely is the firm’s first major investment in a gaming company and was part of a portfolio of investments that NewView took over when it spun off from NEA.
For Scopely, the latest capital infusion is just more money in the bank to invest in or acquire budding game studios and give them access to the technology stack that has made Scopely so compelling, according to Driver.
“Our technology platform is about optimizing free digital experiences for the largest amount of players possible,” Driver says. “We’re primarily focused on finding the most passionate and talented game developers that want to specialize in making the kind of game design and might have the kind of specialized expertise that we admire.”
In the eight years since Scopely first launched, the gaming industry has been transformed by the opportunities that exist in the mobile market — and both Scopely and companies like Jam City have capitalized on the new platform.
“We see the future of gaming as free live services that give users choice and agency of how they want to play,” says Driver. “Being able to refine those live services over time and react to the data that you’re seeing and optimize those products,” has been at the core of Scopely’s technology stack.
The company is already raking in more than $400 million in annualized revenue and it was that growth that convinced NewView and investors like the Canadian Pension Plan Investment Board to commit capital as part of this latest round.
Scopely has already made a few select minority investments in gaming studios, and with the new cash, Driver hopes to roll up more independent game developers.
*This story has been updated to indicate that Scopely’s valuation is $1.7 billion. Not $1.4 billion as originally reported.