July 13, 2024

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Profitable Mobile Game Publisher Scopely Adds $200M Extension To Series D

Less than five months after raising a $200 million Series D, mobile game publisher Scopely has closed on a $200 million extension of that round.

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Advance, a private family-owned business that invests in media and technology companies, and existing backer The Chernin Group (TCG), a consumer-focused investment firm, participated in the second tranche of the round.

Culver City, California-based Scopely, which is profitable, reached unicorn status with the first tranche of its series D. This extension gives the company a post-money valuation of $1.9 billion. With this extension, the company has raised a total of $658.7 million since its 2011 inception, according to Crunchbase data.

Scopely, which has 800 employees working in five countries, has certainly seen impressive growth. The company saw a 72 percent compound annual growth rate (CAGR) from 2014 to 2019. Plus, it reached more than “$1 billion in lifetime revenue” last summer.

In 2019, Scopely acquired FoxNext Games, saw success with its game MARVEL Strike Force, and launched Scrabble® GO.

The company plans to use its new capital toward more mergers and acquisitions and expand  its portfolio of games across new genres.

“When we first announced our Series D funding late last year, a number of discussions with strategic partners who share our vision for the future of interactive entertainment were ongoing,” said Walter Driver, Scopely co-founder and Co-CEO, in a written statement.

In a blog announcing the extension, Driver and co-CEO Javier Ferreira said:

“Our global team, who is now working remotely to best protect their health and their families’ health, has truly rallied as one to continue serving our players and maintain the social connection and experiences they rely on from us. … We are acknowledging this additional financing, which has been in the works for several months and was completed earlier this year, as it was shared publicly by the FTC following regulatory approval this week.”

Scopely Co-CEOs Javier Ferreira and Walter Driver

Investors weigh in

Janine Shelffo, chief strategy and development officer at Advance, said her firm has been closely watching the gaming industry and “identified Scopely as a rising force.”

“We are deeply impressed with its industry-leading technology platform and analytics capability, which it has leveraged to create a diverse portfolio of consistently successful games,” she continued.

Jesse Jacobs, TCG’s co-founder and partner, said Scopely has consistently outperformed expectations since his firm first backed the company nine years ago.

“As the traditional media industry continues to go through unprecedented change, we believe that Scopely has all the ingredients for tremendous success—exposure to games (the fastest-growing sector in media), a scalable and durable technology platform, a diversified set of well-known IP, an attractive economic profile and a team hyper-focused on execution and long-term success,” Jacobs continued.

If it’s making so much money, why the large raises? NewView Capital Managing Partner Ravi Viswanathan told me last October that the M&A space in gaming was heating up.

“There’s a lot of interesting companies and assets that they can acquire and incorporate into the broad Scopely platform,” he said.

Scopely does have a good track record. According to Viswanathan, it’s produced six games in a row that are on track to reach or surpass $100 million in gross lifetime revenue, which he said “is pretty astounding.”

“Gaming is a massive market, worth over $130 billion, and mobile gaming is the fastest-growing piece of it, representing about half,” Viswanathan told me last October. “In Scopely, we see significant scale, growth and profitability–an unusual trifecta. We see a huge market opportunity in front of them.”

NewView spun out of NEA, aka New Enterprise Associates, in late 2018, raising $1.35 billion for its debut fund. NEA had a small position in Scopely and NewView brought that over when it broke out.

I’ve said it before, and I’ll say it again. Gaming may not be taken seriously by all. But if this round is any indication, maybe it should be.

Illustration: Li-Anne Dias

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