With a $340M Raise, Scopely Becomes One of LA's Most Valuable Startups
Ben Bergman
Ben Bergman is the newsroom's senior reporter, covering venture capital. Previously he was a senior business reporter and host at KPCC, a senior producer at Gimlet Media, a producer at NPR's Morning Edition, and produced two investigative documentaries for KCET. He has been a frequent on-air contributor to business coverage on NPR and Marketplace and has written for The New York Times and Columbia Journalism Review. Ben was a 2017-2018 Knight-Bagehot Fellow in Economic and Business Journalism at Columbia Business School. In his free time, he enjoys skiing, playing poker, and cheering on The Seattle Seahawks. Follow him on Twitter.
Just months after raising $200 million, Scopely is getting investors to open up their checkbook again.
The Culver City mobile game unicorn announced Wednesday it has raised $340 million in Series E funding, making it one of the most valuable tech companies in Los Angeles.
In a sign of how robust the market has been for beneficiaries of the stay-at-home economy, the new round values Scopely at $3.3 billion, which nearly doubles the company's $1.7 billion post-money valuation from March.
The company's success is welcome news to Los Angeles investors who backed Scopely in earlier, cheaper rounds. Greycroft, The Chernin Group and TenOneTen ventures were seed investors, getting in at a $40 million post valuation in 2012. Upfront Ventures, BAM Ventures and M13 got in on the 2018 Series C at a $710 post-money valuation.
Asked how the valuation skyrocketed so quickly, Scopely co-CEO Javier Ferreira said the company has done what early-stage investors love to see: ignite revenue growth.
"We have close to one hundred percent revenue growth year over year," Ferreira told dot.LA. "I think we've also shown our ability not just to buy large scale assets, but to grow those kinds of businesses post acquisition."
Revenue from the company's "Marvel Strike Force" has grown by 50% since Scopely acquired the role-playing mobile game as part of a transaction with Disney's FoxNext Games in January, according to Ferreira.
In April, Scopely acquired PierPlay, the maker of Scrabble GO, which became the biggest word game launch ever. Ferreira said more buying lies ahead.
"The space is moving so fast," Ferreira said. "It's an exciting time to be in the gaming space and we want to have the ability to make transformational moves and bring in teams and products to our ecosystem that will further drive growth."
Ferreira said the company is also developing its own games, but all those acquisitions are expensive, hence the need for the Series E, which was funded by Wellington Management, NewView Capital, Canada Pension Plan Investment Board (CPPIB), BlackRock, D1 Ventures, TSG Consumer Partners, Battery Ventures, Eldridge and Declaration Partners.
The new valuation makes Scopely, which was founded in 2011, one of the most valuable Southern California tech startups, according to Pitchbook data. It trails only SpaceX, which was just valued at $100 billion, and Faraday Future, which was valued at $4.4 billion in 2018 but is now planning to go public through a reverse merger.
Scopely now has 950 employees spread across the globe, but Ferreira says those inside the company do not spend much time thinking about Scopely's meteoric growth.
"We've been kind-of growing so fast for so many years now that, to be honest, it doesn't feel that different from a kind of internal perspective."
As Americans continue to stay home during the pandemic, consumers spent $4.3 billion on video game hardware, content and accessories in September, a 10% increase over a year ago, according to NPD Group. Epic Games, with a $17.3 billion valuation, is still considerably larger than Scopely.
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Fred Turner, the 25-year-old founder of Curative Inc., is the man behind L.A.'s push to bring universal testing to the region. But, he has bigger plans.
Turner, an Oxford dropout, just landed a deal with the Air Force to test military worldwide and he's now eyeing national expansion for his startup. By the end of this month, the company he started months ago is expected to pump out more than a million test kits a week.
"We are a strange company because our goal is to essentially put ourselves out of business," Turner said.
<p>Turner, who was named UK Young Engineer of the Year at age 17 when he built a DNA machine from his bedroom to figure out why his brother had red hair and he had brown hair, turned his focus to coronavirus in January. He upended his life as head of Shield Bio, which sought to eliminate sepsis, and moved to Southern California after a local venture capitalist connected him with a lab that he could build out for COVID-19 testing. </p><p>Curative Inc. was born. </p>
<img lazy-loadable="true" src="https://dot.la/media-library/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yMzE4NjM5Ni9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTYxMTkyMDg3Mn0.Fy0dtjHfIsqIXJAOI7MUohie11857cWDACI3OksmLt4/image.jpg?width=980" id="515a2" class="rm-shortcode" data-rm-shortcode-id="7ee43a7a9c8e7ea09bd6cdb251d45ace" data-rm-shortcode-name="rebelmouse-image" />
Curative, Inc. Founder Fred Turner is the man behind L.A.'s push to bring universal testing to the region.
<p>For weeks he lived in hotels as he created what has become the backbone of testing in America's second largest city. The company, one of the few saliva-based tests that have gotten emergency approvals from the FDA, has a 10% false negative rate, according to their own non-peer reviewed studies. Turner argues the rate is better than most of the nasal swab testing out there and oral tests, which can be self-administered, are the only way the country can reopen quickly.</p><p>He is now operating two labs, one in San Dimas another in Washington D.C., with plans for several more across the nation. Meanwhile, the rest of the country is watching to see if Los Angeles' promise of universal testing meets the expectations with some already complaining about the difficulty of securing an appointment.</p>
<p><strong>dot.LA: Curative is responsible for 95% of Los Angeles COVID-19 tests. Can you meet the demand for universal testing?</strong><br/></p><p><strong>Curative, Inc. Founder Fred Turner:</strong> We will be able to fulfill demand. There's more infrastructure that needs to be put in place. With the collection site, the mayor's office has been working hard to scale those up and make sure that the collection site infrastructure is in place. On the lab side, we definitely have enough capacity to serve the area.</p><p>In (the San Dimas) lab we have capacity for about 20,000 per day. We're going to be scaling this lab up to 30,000 over the next week or so, eventually, probably slightly more than that. </p><p>Ultimately, the goal is to do as many tests as we need to reopen the country and I think we've had many different estimates of how many that might be. I've heard estimates (that it will take) as high as five million tests a day to reopen, but the current supply chain is nowhere near going to be able to keep up with that. The next goal we are shooting for is a million tests a week by about mid-May, end of May.</p><p><strong>If we're testing more people will that strain the turnaround time? Right now, I understand it's about 24 to 72 hours. Can you take it down to several hours or even minutes?</strong></p><p>We are always aiming to push it down. I think it can be pushed under 24 hours, but we tend to focus more on scaling it up at that point. I think 24 hours is around optimal as you bring on more capacity. We're obviously being careful to match the capacity coming into the lab against the turnaround. </p><p><strong>Curative is one of the few companies that the FDA has provided emergency approval for use of a saliva test. Do you think this is the answer to universal testing nationally?</strong> </p><p>Oral fluids is the technical term, which is slightly different from saliva. Our protocol involves having the person cough first, which releases virus from the upper and lower respiratory tract. Some of that is then caught in the saliva, and also viruses in the saliva. The idea is you're effectively sampling multiple sites at once, which we think gives a slight increase in the sensitivity of the testing.</p><p>Self-collected sampling has got to be the way forward. There's just no way that we can do a million nasal pharyngeal swabs, or we call them 'brain swabs,' it's just not practical. We don't have the medical staff, and as a country we just can't do that many swabs. And so the way forward is going to be self collection. That's the only thing we can do at scale.</p><p class="shortcode-media shortcode-media-youtube">
<span style="display:block;position:relative;padding-top:56.25%;" class="rm-shortcode" data-rm-shortcode-id="93ba4781c410d06eb2cfed59cce147a8"><iframe type="lazy-iframe" data-runner-src="https://www.youtube.com/embed/LNopEE7lC6E?rel=0" width="100%" height="auto" frameborder="0" scrolling="no" style="position:absolute;top:0;left:0;width:100%;height:100%;"></iframe></span>
<small class="image-media media-caption" placeholder="Add Photo Caption...">Covid-19 Oral Fluid Test Kit Instructions</small>
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</p><p><strong>Curative recently secured a contract with the Department of Defense. What's next?</strong><br/></p><p>We haven't settled on the exact number, but we will be in a large number of states. That is the plan, building out the infrastructure for this kind of testing. We can take the L.A. model and scale it across the country. We have a version of the drive-thru software that other cities and states can take. We have all the training material. We have a team that fly around the country setting up these drive-thru sites. We have really tried to make a plug-and-play package where cities and states that want to launch drive-thru testing, we have everything they need. </p><p><strong>Is Los Angeles a testing ground and a proving ground for national efforts?</strong></p><p>Yeah, I think Mayor Garcetti has definitely demonstrated what can be done if the city moves very quickly to build out the infrastructure, I do think the drive-thru testing, walk through testing is going to be an essential component of this.</p><p>It's just much faster to get the samples to the lab than shipping it out and then shipping it back again. The infrastructure piece is critical for getting these tests out there and we're working with several other states now on building out a similar infrastructure. Some of them have existing programs that we would be plugging into and expanding, and some of them are looking to roll out their own similar programs. You can test a lot more people with the oral tests with far fewer staff.</p><p><strong>What are the challenges with the supply chain in terms of making your tests more widely available?</strong></p><p>We need more plastic, more robots, more people. Most of the components that go into these tests are just already maxed out in their production capacity. And so we've been throwing online a bunch of internal production, such as injection molding to make our swab kit tubes, as well as bringing on other sources of similar materials that are not being used for COVID-19 testing and validating them for COVID. So for the swabs, for example, we use a swab type that is usually used for testing clean rooms. It works just as well for COVID testing, but nobody else is using it for that purpose. </p><p>We don't want to be competing with other people, stopping them from getting access to resources. We want to bring on new supply so it's not a zero- sum game, and the total amount of tests will increase. But, I think distribution is going to be a bigger bottleneck over the next month. Los Angeles has done a fantastic job in building out infrastructure and collection. That needs to happen now across the whole country. </p><p><strong>What would it take to meet national demand?</strong></p><p>It would take a network of multiple labs that we are calling gigalabs that can process 50,000 to 100,000 tests a day across the country and a significant scale up in the production of the physical components that go into the tests. We've been investigating lab sites in a few states, something central like Texas or Colorado. </p><p><strong>Are you concerned that you have too high of a false negative rate at 10%?</strong></p><p>All COVID tests will have false negative rates. In our studies, we demonstrated that the sensitivity is at least as good if not better than the nasal pharyngeal swab tests. So, there will definitely be false negatives as there will be in every test, but we think the data supports us having a low rate of false negatives. The sensitivity is about 90%.</p><p>When you include all patients, the nasal pharyngeal came in at about 79%. A new (non-peer reviewed) Yale study shows a higher sensitivity from saliva and all fluids than the nasal pharyngeal. I don't think we have the evidence to say that we're better yet, but we have the evidence to say that we're at least equivalent. The ease of doing oral tests and the accessibility is obviously significantly better. We're not using PPE. We're not exposing healthcare workers. It's just a much easier test to roll out that people can test themselves.</p><p class="shortcode-media shortcode-media-rebelmouse-proxy-image">
<a href="https://upload.wikimedia.org/wikipedia/commons/f/f9/Florida_National_Guard_%2849677710741%29.jpg" target="_blank"><img type="lazy-image" data-runner-src="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vbWVkaWEucmJsLm1zL2ltYWdlP3U9JTJGd2lraXBlZGlhJTJGY29tbW9ucyUyRmYlMkZmOSUyRkZsb3JpZGFfTmF0aW9uYWxfR3VhcmRfJTI4NDk2Nzc3MTA3NDElMjkuanBnJmhvPWh0dHBzJTNBJTJGJTJGdXBsb2FkLndpa2ltZWRpYS5vcmcmcz0yNzMmaD1hZDI1NWIwOTNkYWE5ODBjMzU4NjMzYWM0YmE2OGYwYmYxZGRlMGNmYjFlNjdjNDhlMjQxZTZkZDZjZDE3YzNhJnNpemU9OTgweCZjPTEzMDE3NDMyMjYiLCJleHBpcmVzX2F0IjoxNjE0NzExNjkyfQ.BvjB0Zw5cLoqqcX5ba4uhPBwCzyao_4h0HSdTdD7IEk/img.jpg" id="cbbc9" class="rm-shortcode" data-rm-shortcode-id="8965d4da3c9fec19960a954cded4abca" /></a>
<small class="image-media media-caption" placeholder="Add Photo Caption...">File:Florida National Guard (49677710741).jpg - Wikimedia Commons</small>
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</p><p><strong>At one point, Curative was attempting to roll out at-home testing and then had to pull back after FDA warnings. Will you be making home testing kits again?</strong><br/></p><p>I can't give a time estimate but we are actively working with the FDA right now. I think their concern is "can people adequately collect the sample, or will they do it wrong, and then get a negative test result," which is incorrect. Our plan is to use telemedicine observation. What we've seen in our clinical studies is that if you give people the chance to do it wrong, they will do it wrong. In fact when you have somebody observing, they read the instructions better and they collect a better sample. We're still working on the pricing and potentially looking at whether there is federal or state reimbursement for some of that testing and the potential of billing insurance. </p><p><strong>Tracing technology has been promising. Do you have any plans to tie tests to these applications to testing?</strong> </p><p>We've had several conversations with contact tracing apps and we continue to work in collaboration with public health departments in their contract tracing efforts. Having the test is obviously one thing, but you have to use the information to actually stem the tide of COVID infection. And so, it is an essential step in working closely with various people. </p><p>I do like the app-based models where you obviously want to maintain people's privacy, but having people opt-in to share their location history if they test positive so you can contact nearby people.</p><p><strong>What does Curative do once there's a vaccine? Are you obsolete?</strong></p><p><strong></strong>The U.S. needs to maintain some kind of spare capacity so that next time we are not having to build all of this during a pandemic. But we are a strange company because our goal is to essentially put ourselves out of business. Ultimately, and I say this to everyone we hire, we don't know how long this will go on for. We want to provide as many tests as needed, but the goal is to end COVID and not be doing COVID testing anymore.</p><p><strong>Curative took off in March when you arrived in Los Angeles from Silicon Valley, how has the journey been for you personally?</strong></p><p><strong></strong>I don't have very much free time, but it's been a lot of fun to be able to work at this pace and have the support of people like the city, the mayor's office to really just do what is needed to scale this up. When we work with suppliers, and we say we're doing COVID testing, they just move heaven and earth to make things happen. It's been really inspiring to be a part of that push forward.</p><p>We are just pushing as hard as we can to scale up as fast as we possibly can and bring on as much testing as we can. The city opening up testing to everybody is kind of a culmination of that. We're making about 50,000 kits a day right now and we want to make that as widely available as we can. I would like to get a little more sleep. </p><p><em>The interview has been edited for clarity and brevity. </em></p><p><em>Correction: An earlier version of this story stated that Curative's saliva tests have a 10% false positive rate. In actuality, the tests have a 10% false negative rate.</em></p><p><em><em>Do you have a story that needs to be told? My DMs are open on Twitter <a href="https://twitter.com/racheluranga" target="_blank">@racheluranga</a>. You can also <a href="mailto:mailto:rachel@dot.la" target="_self">email me</a>.</em></em></p>From Your Site Articles
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Here's the deal: the first segment of a three-part Joe Biden interview aired Wednesday on Snapchat's "Good Luck America." Parts two and three will follow on Thursday and Friday, respectively.
Interviewer Peter Hamby did not mince words in asking Biden about his being perceived as "old, out of touch, and kind of lame."
<p>The avuncular presidential candidate, who has alternately been christened Dementia Joe, Creepy Joe and Sleepy Joe, retorted, "I don't have any problem comparing my energy level to Donald Trump, who I'm really resisting giving a nickname to." The 77-year-old later redoubled his display of vigor, proclaiming, "I can hardly wait to get out of being on my back porch here."</p><p>The democrat has had his plans upended by the coronavirus, like so many Americans. Biden has been forced to rely on his online presence since he's no longer able to hit the physical campaign trail. It's not exactly an ideal battleground for the former vice president: Biden's social media followers across Facebook, Instagram and Twitter total just 7% those of President Trump. (Snap does not publish such data.)</p><p class="shortcode-media shortcode-media-rebelmouse-image">
<a href="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yMzI3ODQ2My9vcmlnaW4ucG5nIiwiZXhwaXJlc19hdCI6MTU5MjE5NzgyM30.JhdxrTOHoHarFD82LhSbiullXDfIkcpooTZ5KhM-Lrg/img.png?width=980" target="_blank"><img type="lazy-image" data-runner-src="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yMzI3ODQ2My9vcmlnaW4ucG5nIiwiZXhwaXJlc19hdCI6MTY1NTI2OTgyM30.Lv-ik0tpojDEfcUoJmS5Oow3wIQ27kHHb_13APJ-Rrw/img.png?width=980" id="025ec" class="rm-shortcode" data-rm-shortcode-id="7082ecb2e8058c42214227436ee7873b" data-rm-shortcode-name="rebelmouse-image" /></a>
<small class="image-media media-caption" placeholder="Add Photo Caption...">Presidential social media followers as of May 13, 2020 in millions.</small>
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<a href="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yMzI3ODQ2My9vcmlnaW4ucG5nIiwiZXhwaXJlc19hdCI6MTU5MjE5NzgyM30.JhdxrTOHoHarFD82LhSbiullXDfIkcpooTZ5KhM-Lrg/img.png?width=980" target="_blank">assets.rebelmouse.io</a>
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</p><p>Biden addressed the discrepancy on his Wednesday segment.<br/></p><p>"We're getting started late in the comparative sense," he said. "I'm sure we can do better on the internet. I'm positive of that...we're trying." </p><p>Snap claims that over half of the U.S. Gen Z population watches news content on its Discover platform. Across its entire app, the company says it reaches 90% of all 13-24 year-olds in the U.S., and 75% of all 13-34 year-olds. Biden spent much of Wednesday's segment expressing sympathy toward those young people whom he surely hopes will help him win in November. </p><p>"Young people want the truth and they want authenticity," he observed. "And younger Americans have had a really tough run of it. Millennials came of age defined by 9/11, the 2008 financial crisis. Generation Z has grown up at a time of school shooting, crushing student debt."</p><p class="shortcode-media shortcode-media-youtube">
<span style="display:block;position:relative;padding-top:56.25%;" class="rm-shortcode" data-rm-shortcode-id="d5998b43453bb9a6ab541edc7bc5f143"><iframe type="lazy-iframe" data-runner-src="https://www.youtube.com/embed/IlaW40ST_f8?rel=0" width="100%" height="auto" frameborder="0" scrolling="no" style="position:absolute;top:0;left:0;width:100%;height:100%;"></iframe></span>
<small class="image-media media-caption" placeholder="Add Photo Caption...">Peter Hamby Interviews Vice President Joe Biden | Good Luck America | Snap Originals</small>
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<a href="https://www.youtube.com/watch?v=IlaW40ST_f8&feature=youtu.be" target="_blank">www.youtube.com</a>
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</p><p>Political pundits have questioned of late whether Biden's message will resonate with younger voters.<br/></p><p>The conveyance of that message by Snap is part of the L.A.-based company's wider content strategy, which includes numerous efforts to provide credible news to its relatively impressionable audience.</p>
<img lazy-loadable="true" src="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yMzI3ODM5Ny9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTY2MDEyNjc5Nn0.a9bFRGZpSbTJlerV-kiR4WDq4RFgAp5PT16XMRMiG_M/img.jpg?width=980" id="3e266" class="rm-shortcode" data-rm-shortcode-id="3ec8677e97ed08539f395ce0622cbf8c" data-rm-shortcode-name="rebelmouse-image" /><p>--- </p>
<p>According to a company spokesperson, Good Luck America was "born from the desire to help our Snapchat community understand a confusing time in American politics." Launched in 2016, it was Snap's first original series. Since then, interview guests have included Barack Obama, Bernie Sanders and John McCain.</p><p>Earlier this year Snap rolled out multiple resources on its Discover platform "to ensure our community has consistent and reliable resources for the latest updates on COVID-19." As of April, over 40% of Gen Z in the U.S. had engaged with some kind of COVID-19 related content, such as the videos on Snap's dedicated "Coronavirus: Updates" channel, according to the company.</p><p>To help keep content free of deceptive or deliberately false information, Snap's Discover platform does not include an open feed for unvetted publishers, the company says. Instead it curates such content in partnership with "trusted news organizations," the World Health Organization and Britain's National Health Service.</p><p>Biden's appearance follows Anthony Fauci's last month. Snap declined to release viewing figures for either interview.</p><p>---</p><p><em>Sam Blake covers media and entertainment for dot.LA. Find him on Twitter @hisamblake and email him at samblake@dot.LA</em><br></p>
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