Six gaming industry veterans have created a new game studio, Theorycraft, and closed a $37.5 million Series A round this week to help them get started.
They're looking to grow their team and develop games that are "deep, 10,000 hour games … worthy of being theory crafted," said Joe Tung, founder and chief executive, in an interview with GamesBeat. Tung was formerly the executive vice president of Riot Games' "League of Legends" franchise, where he worked on the game for seven years.
Theorycraft's team members have worked on some of the biggest titles in gaming, including "Halo," "League of Legends," "Valorant," "Overwatch" and "Team Fortress 2." The team is comprised of Chief Technical Officer Michael Evans, who was formerly distinguished engineer and technical lead for "Valorant" at Riot, and Chief Creative Officer Mike Tipul, who founded Marauder Interactive and formerly worked at Bungie. Riot veterans Moby Francke and Areeb Pirani serve as Theorycraft's art director and chief operating officer, respectively.
Eventually, Tung wants the team to expand to 30 or 40 people when the first game releases, he told GamesBeat. This is far fewer members than are on development teams at Riot and other studios, but he said, "it's really exciting that there are clear benefits to keeping the core dev team as small as possible."
The studio got its name from the term theorycrafting, which its website defines as "an honor players reserve for the deepest games in the world… when a game is worthy of endless speculation and debate about how best to play." The studio aims to make player-versus-player games that consumers continue to return to.
"We feel pretty damn fortunate," said Tung in a statement announcing the raise. "Not only to have gotten off to such a great start to the studio — but to have found a group of such like-minded partners who believe like we do that games serve fundamental human needs; who support our goal of getting the game in players' hands quickly and developing the game with them; and most importantly, who understand that we are in this for the long-term."
The round was led by Chinese internet technology and entertainment company NetEase. Theorycraft did not respond to a request for an interview, but Tung told GamesBeat that NetEase is willing to share resources and "go big … [and play] the long game." NetEase's resources will help supercharge their ambitions of making long, complex games that can take 10,000 hours to complete. Investors NEA, BitKraft Ventures, Griffin Gaming Partners and SISU Game Ventures also participated in the round.
If it seemed like everyone and their mother took up gaming this year, that may be because playing became far more popular as social media transforms the industry.
Nearly all games allow for multiple players to interact inside the game, but this year as the pandemic kept people at home, game worlds further converged with social media. Gamers used livestreaming platforms like Twitch and Discord to connect as they play.
Meanwhile social media companies like Facebook boosted their gaming platforms and Snap supersized its gaming effort with Bitmoji Paint, which it released in December.
Nintendo's "Animal Crossing: New Horizons" was embraced by politicians, with both congresswoman Alexandria Ocasio-Cortez and president-elect Joe Biden creating neighborhoods and encouraging their constituents to come pay them a virtual campaign trail visit.
It all meant a push toward a more social game.
And it was in a year that players spent big on their favorite titles - in November alone, digital games earned $11.5 billion, the highest monthly revenue ever recorded by Nieslen's SuperData.
Global gaming revenue smashed records with sales estimated to reach $174.9 billion by the end of this year, up roughly 20% from last year, NewZoo games analyst Tom Wijman wrote in a recent report. NewZoo predicts that by the end of 2021, roughly 2.8 billion people will be gaming worldwide.
Social media plays a crucial role in how well a game is received, and it hugely influenced which games took off this year. "Among Us" is a two-year-old game, but when streamers started broadcasting matches in early April, it quickly attracted new players.
Similarly, popular game streamers broadcasting Santa Monica-based Activision Blizzard's "Call of Duty: Warzone" game helped the game go viral and jumpstarted adoption of its newest title, "Black Ops Cold War," which was the top-selling console game in November with 5.7 million copies sold.
Adoption of multiplayer games and content is expected to keep rising, prompting startups including Playa Vista-based VENN to capitalize on a market ravenous for group entertainment.
VENN's network of gamer-friendly television is now expanding to smart TVs (it recently struck deals with Roku and Samsung) and existing social networks like YouTube, said Jimmy Wong, producer and co-host of VENN's talk show "The Download."
"Our view of the pandemic is one of someone dousing an already lit flame with lighter fluid," Wong said. "It's a step towards a wider acceptance of video gaming as being one of the most popular things for people to do."
In October roughly 931,000 people engaged with Santa Monica-based Riot Games' "League of Legends" page on Reddit, according to NewZoo's report on the most active gaming communities.
Ocasio-Cortez broke Twitch records streaming "Among Us," in November, when she linked up with several famous streamers for a live broadcast that reached over 400,000 people.
Social media not only expands the reach of a multiplayer game, but also its lifespan -- "League of Legends" is over a decade old, and Activision's "Call of Duty" franchise launched in 2003. "Among Us" came out in 2018, but it made $3.2 million in digital revenue this year and passed half a billion downloads in December.
"There's now so much evergreen video content surrounding these games which has made the lifespan and reach so much greater," said Ryan Horrigan(cq), CEO of West Hollywood-based Artie, a startup that designs multiplayer cloud-based browser games and will launch in 2021. "I do think gaming is becoming the next social network."
Social media and streaming drives players back to games but it's also a lucrative ad opportunity. "The world of gaming is permeating well beyond even the notion of a game," Horrigan noted, and lately includes film and TV adaptations of hit titles.
Scopely, a Culver-City based mobile publisher, both makes and acquires multiplayer games. "Marvel Strike Force," which it bought from Walt Disney Co. in January, is its biggest earner. "We will close the year above $900 million in revenue, nearly double the revenue of 2019," Scopely's head of strategic partnerships Mike DeLaet told dot.LA.
Tim Richards, vice president of publishing at Calabasas-based GreenPark Sports, is designing a virtual space for sports and esports fans to hang out and play that will launch in January. "We designed the idea around this data that 90% of Gen Z classify themselves as gamers," Richards said. He noted that even hardcore sports fans like virtual viewing -- "Even back in (pre-pandemic) days, very few folks went to every sports game."
Analysts agree gaming is now a more essential form of social entertainment than ever before and it will continue to grow in audience next year, as will streaming and virtual events that take place inside live games.
"Multiplayer games would have grown in popularity regardless of COVID-19," said Carter Rogers, principal analyst at SuperData. "This growth is sustainable, and we aren't likely to see any sort of video game 'crash' after most people are vaccinated. People are forming long-term habits as they play online games, many for the first time."
Correction: An earlier version of this piece mis-identified Tim Richards, GreenPark Sports' vice president of publishing.
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Santa Monica-based PlayVS, a platform that organizes high school esports leagues, raised $10.5 million, SEC filings show.
The injection of money comes just as PlayVS is making a push to expand across all 50 states and diversify their offerings. The two-year old company raised $50 million this summer and with the most recent round, the company's total funding jumped over $100 million.
PlayVS declined to comment on the raise, but a spokeswoman for the company said it's "currently focused on growing its business, partnering with schools and continuing to strengthen its mission."
PlayVS partners with the National Federation of State High School Associations and 23 state associations, where it's recognized as a varsity sport. Students can play competitive team games like Rocket League, a game in which a player drives a car to play soccer, to earn a varsity letter and compete for state championships.
Over 21,000 schools and 143,000 students have registered so far. Like with varsity sports, a faculty member is required to supervise. Students register online under their school team, to compete in two seasons during the academic year, aligned with fall and spring sporting seasons. The cost is $63 for each participating student, $1,024 for 16 players per season.
The platform has seen interest rise as COVID keeps school-aged children at home.
Over the summer, PlayVS added Overwatch to their available games, partnering with the game publisher Activision Blizzard for the first time. The company also partnered with Riot Games and Epic Games, and students can compete in League of Legends or Fortnite.The esports industry was valued at over $1 billion last year, and is expected to grow 24% annually from 2020 to 2027.
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