Tencent has taken a stake in French cell video games firm Voodoo, because the Chinese language web group seems to be to step up its tempo of investments in Europe.
The minority funding provides Voodoo an enterprise worth of $1.4bn, making it the primary “unicorn” firm within the fast-growing “hyper informal” gaming market. The deal follows Zynga’s $168m acquisition of one other hyper-casual outfit, Rollic Video games, this month.
Voodoo’s portfolio of video games equivalent to Helix Bounce, Crowd Metropolis and Paper.io — which look easy and fast to play however are sometimes very tough to finish — has attracted greater than 1bn gamers around the globe, together with many in China.
The Paris-based firm hopes to make use of its new alliance with Tencent to maneuver into informal video games, taking it into extra direct competitors with the likes of King’s Sweet Crush Saga and Playrix’s Gardenscapes.
“What we like about Tencent is that they have a lot expertise in additional advanced video games with extra depth,” stated Alexandre Yazdi, Voodoo’s chief govt. “We actually consider that we will add a recent wave of recent informal merchandise that come from our hyper-casual improvements.”
Tencent’s stake in Voodoo will sit alongside a number of different gaming investments outdoors China, together with Epic Video games, the maker of Fortnite, Conflict of Clans developer Supercell and Riot Video games, which created League of Legends.
“But once more, Tencent show to me that they’re most likely essentially the most expert investor within the gaming house globally,” stated Per Roman, co-founder and managing accomplice of GP Bullhound, a tech adviser. “They pay up for high quality, which is extra uncommon in Europe than in Silicon Valley.”
Chinese language tech corporations are discovering themselves more and more constrained of their dealmaking within the US by political tensions between the 2 nations.
This month, the Trump administration unexpectedly focused Tencent’s hit social media app WeChat, giving US corporations 45 days to cease doing enterprise with the app. Tencent has argued the motion is not going to apply to WeChat in mainland China, the place the majority of its 1.2bn customers are.
“For any Chinese language firm now, it is rather engaging to purchase outdoors China,” stated Mr Roman. “Proper now the US is difficult. That creates a constructive internet impact for Europe.”
Tencent is within the means of finishing its buy of Norwegian recreation developer Funcom, valued at $160m. In February, it put cash into Yager Improvement, the Berlin-based studio behind Spec Ops: The Line.
Earlier this 12 months, Tencent led a $45m funding spherical for Lydia, a French cell funds firm. Its funding in Common Music Group, with the Chinese language group main a consortium that paid $3.3bn for a 10 per cent stake, closed in March.
Voodoo’s Mr Yazdi stated that the corporate deliberate to broaden additional in Asia Pacific, in addition to including multiplayer options to extra of its video games.
“Android [app] shops in [Asia Pacific] are very fragmented, so it’s crucial to have a robust accomplice to distribute our video games,” he stated.
Voodoo was co-founded in 2013 by Mr Yazdi, who will stay its largest shareholder following the deal, and Laurent Ritter.
Revenues, that are pushed primarily by in-game promoting, grew by 10 per cent in 2019 in contrast with the 12 months earlier than to €360m. With simply 250 workers behind a portfolio of video games which have been downloaded greater than 3.7bn occasions to this point, Voodoo is worthwhile. It expects continued development this 12 months, as cell gaming has boomed throughout coronavirus lockdowns, and it plans to rent dozens extra workers at its 11 workplaces, in addition to opening its first location in China.
Detailed phrases of the Voodoo deal, together with the whole quantity Tencent invested, weren’t disclosed.