According to a new report from Drake Star Partners, the first five months of 2021 have seen more total deal value in the gaming sector than any other year.
Throughout the five-month period, the global investment banking firm has measured $49 billion of M&A and investments. This value is spread across 527 individual deals and the activity has been driven by various trends.
In general, there is a large amount of cash in the global economy, which means established companies and investors have access to more investable capital.
This has been reflected in the activities of companies such as Tencent (eight deals), Embracer (seven deals) and Epic Games (four deals).
Emerging sectors
This is also combined with emerging sectors like blockchain and NFTs, triggering a new wave of early-stage deals from investors. This includes Bitkraft (nine deals), Makers Fund (nine deals) and Play Ventures (seven deals).
In addition, some of the activity is resulting in companies entering public markets either through IPOs or SPAC deals. Playtika, Roblox and Applovin are examples of the former, with JamCity and IronSource examples of the latter.
Finally, Apple’s disruption of the UA market is also driving consolidation, as well as the opportunities for game companies to acquire the ability to bolster their own in-house analytics skills.
You can read the full report (email required) via the Drake Star website.
As part of our Done Deal series, we recently spoke to Ninja Kiwi co-founders Chris and Stephen Harris about why they felt now was the right time to sell.
