Financials are nearly always a pretty dry read, but our ongoing breakdown of Drake Star’s Global Gaming Report for September 2022 is here to point out some of the key takeaways. We can naturally refer to major acquisitions, what with the ongoing Activision Blizzard saga, but some key technologies such as blockchain and NFTs are still seeing investors go all-in on them, hoping for a resurgence. Meanwhile Embracer Group continues to live up to its name and spread its arms wide to acquire more companies.
There have also been some interesting acquisitions on which we’ve previously reported. VK’s MY.GAMES platform was purchased for $642m by Managing Partner of Leta Capital, Aleksander Chachava. As Drake Star points out, the macroeconomic circumstances have been difficult this year, however we can see how the markets have adapted from earlier in the year to begin taking advantage of otherwise turbulent conditions that have affected the gaming industry.
The Fearful Fiscal Frights
Accordingly, although the year started out strong in Q1, with major deals such as the Activision Blizzard acquisition yet to be completed, even now there was a significant lull in Q2. “ With a bumper Q1, and a quieter Q2, we saw a notable rebound in Q3 in M&A and financing activity.” So far it’s been a major year for acquisitions as well, as aside from the Activision Blizzard deal, Embracer Group has also been making major grabs “-with 8 acquisitions totaling over $765M.”
As for where the money is going, we can see some key trends, such as LootMogul raising $200m from Gem Global Yield to build a “sports metaverse platform.” We can see this trend as well with Animoca raising $183.5m from a variety of investors and Jot Art raising $55m, all for metaverse related expansion or projects. Given the necessary infrastructure costs involved, man-hours and other necessities, it makes sense that investment would be high for projects such as this.
Despite a global downturn in the popularity and prices of NFTs we also see many companies still forging onwards with their plans to integrate blockchain technology into their games. Such as the aforementioned Loot Mogul, as well as Limit Break who raised $200m to create a “free-to-own” ecosystem. “More than $3.4B was raised by private blockchain / NFT gaming companies with around half of [the] total amount raised by early-stage companies.”