Mobile gaming platform Scopely raises $55M funding round

With the huge success of Pokemon GO bringing a lot of attention to the mobile gaming space, there probably couldn’t have been a better moment for Scopely, a mobile gaming platform, to have raised its new round of funding.

The company announced on Tuesday that it has raised $55 million in a round led by Greycroft Growth Fund with participation from Elephant Partners, the new fund of Warby Parker co-founder Andy Hunt and former Highland Capital colleague and partner Jeremiah Daly; Evolution Media Partners, a partnership of CAA-backed Evolution Media Capital, TPG Growth and Participant Media; Highland Capital; Sands Capital Ventures; and Take-Two Interactive. 

This is the first funding that Scopely has raised since its $35 million round in late 2014. The company now has over $98 million in venture funding.

The Los Angeles-based Scopely was founded by AdSense co-creator Eytan Elbaz, Walter Driver and Ankur Bulsara in 2011. Elbaz co-founded Applied Semantics, which was bought by Google in 2003 and became the AdSense product. Driver founded O Negative Media and co-founded Ignition Interactive. Bulsara was the lead developer on MySpace’s Developer platform. 

The company helps independent mobile game developers optimize their products for competition against products from larger companies. It works with independent studios to co-develop multi-player games that leverage its network for technology, distribution and monetization.

Scopely says it has released six consecutive No. 1 games, including two new Top 10 Grossing games launched in 2015: YAHTZEE With Buddies, developed in partnership with Hasbro, and The Walking Dead: Road to Survival, which has been installed by more than 20 million players to date.

The success of these games has led to Scopely growing its revenues by more than 500 percent over the past 18 months. In December, Scopely was named the second fastest growing technology company in America by Deloitte.

Along with the new funding, Scopely also added two new members to its board of directors: Scopely President and COO Javier Ferreira, and Greycroft Partner Mark Terbeek.

“Scopely brings the technology, talent and monetization infrastructure necessary to launch products INTO massive global business that grow over time. Scopely is at the forefront of the consumer transition from a world of linear entertainment to a world of interactive entertainment,” Terbeek said in a statement.

“We’ve been tracking the company closely for years since our initial seed investment and have been incredibly impressed with the executive team’s ability to realize their vision and create more believers every step of the way.”

The future of mobile gaming

The biggest news in mobile gaming recently has been the enormous success of Pokemon GO, which has been breaking records left and right.

For those of you who don’t play it, or who haven’t been bombarded with it on your Facebook for the last few days, Pokémon GO is a game that centers around augmented reality. Players walk around in the real world to order to move their avatar in the game. A player will encounter a Pokémon using the camera their mobile device, which display an image of a Pokémon as though it were existing in the real world.

Not only has the game been surpassing even the largest social networks in engagement numbers,according to SurveyMonkey, at its peak DAUs, Pokémon GO is now the “biggest mobile game in U.S. history,” surpassing Candy Crush Saga in 2013 and Draw Something in 2012.

The game also had the largest number of downloads in its first week than any other app in the history of the App Store. It’s truly a phenomenon. 

What we really have to see, though, is if the game is a one-off, or the start of a larger trend toward augmented reality in mobile gaming. Surely there are now many, many studios looking to create their own, similar games, which incorporate real world surroundings, but this might have been the perfect combination of name recognition and new, exciting technology. 

Scopely says it will use the new funding to continue to invest in its games, while also allowing it to make “further investment in its product slate and developer ecosystem.” VatorNews reached out to the company for comment on any potential plans it for augmented reality games. We will update this story if we learn more. 

While it seems like games are getting more exciting and interesting, though, the space has actually started to shrink, according to data from PitchBook.

 In 2011, there were 144 deals in the mobile gaming spaces, but by last year that had declined by 36 percent just 92 deals. Dollars also fell sharply in that same amount of time, going from $1.22 billion in 2011, to $415.21 million last year, a drop of 66 percent. However, if you remove Zynga’s $490 million round from 2011, the difference isn’t quite as stark.

Since the beginning of 2010, there have been 665 investors who have made at least one deal in the space, with 514 companies receiving funding, though only seven of them have raised over $100 million.

(Image source: scopely.com)