“I guess he’s an X-box, and I’m more an Atari, but the you play the game ain’t fair.”
Cee-Lo Green, “Forget You“
Many people in the investment world are negative on the gaming sector due to the over-promises and under-deliveries of companies such as King and Zynga — what I call the “King-Zynga Effect.”
The mobile casual game market is arguably the hardest segment in which to make money, unless you have a movie-style blockbuster “hit.” However, to put things into perspective, mobile casual games are only a small segment of the overall $60B+ gaming market. Doubters have thrown the baby out with the bath water, letting the King-Zynga Effect overshadow the successful mega-deal acquisitions and returns that brave investors have enjoyed over the past four years.
In this contrarian market, I have certainly enjoyed being one of the most active venture investors in gaming. While one could argue that it’s in my best interest not to share this secret, I love gaming and am a champion of the industry. So let the games begin!
Here it is: the state of gaming investments thus far in 2014, from Q1 through Q3.