Epic raises $2B at a nearly $32B valuation to build its kid-friendly metaverse

Fortnite-maker Epic Games announced today that it has raised $2 billion in funding from Sony and Kirkbi, the parent company of the Lego Group, with both companies investing $1 billion each. This latest funding round gives Epic a money equity valuation of $31.5 billion. Epic says the new funding will go toward its efforts to build its kid-friendly metaverse and will also support its continued growth.

Today’s announcement comes a few days after Epic revealed that it’s partnering with Lego to build a metaverse aimed at kids. The companies say they are going to shape the future of the metaverse to make it safe and fun for children while building an immersive digital experience for kids to play in.

With this new funding, Epic says all three companies aim to create new social entertainment that explores the connection between digital and physical worlds.

“As we reimagine the future of entertainment and play we need partners who share our vision. We have found this in our partnership with Sony and Kirkbi,” said Tim Sweeney, the CEO and founder Epic Games, in a statement. “This investment will accelerate our work to build the metaverse and create spaces where players can have fun with friends, brands can build creative and immersive experiences and creators can build a community and thrive.”

Prior to this funding round, Epic raised $1 billion in April 2021, featuring a $200 million Sony Group Corporation investment. Other investors included Appaloosa, Baillie Gifford, Fidelity Management & Research Company LLC, GIC, T. Rowe Price Associates-managed accounts, Ontario Teachers’ Pension Plan Board, BlackRock managed accounts, Park West, KKR, AllianceBernstein, Altimeter, Franklin Templeton and Luxor Capital.

While Epic and Lego haven’t gone into detail about their plans for their proposed metaverse, they outlined three principles that they say will ensure the digital spaces they develop are safe. The two will work together to make children’s safety and well-being a priority, to safeguard children’s privacy and to equip children and adults with tools that give them control over their digital experience.

Epic said the digital experience will be family-friendly and empower children to become “confident creators.” The companies plan to combine their experience to ensure that this next iteration of the internet is designed with the well-being of kids in mind. There’s no word on what exactly the virtual world would look like or when the two companies plan to launch it.

There’s no clear definition of the “metaverse” just yet, mainly because it doesn’t necessarily exist, but it’s largely seen as a network of virtual spaces that will open up new ways for people to connect online. The idea of the metaverse is already proving to be unsafe for children, which will force Epic and Lego to create extensive safeguards around their planned virtual world.