Blockchain Gaming Most Active Segment
According to the Global Gaming Report 2022 by Drake Star, the gaming industry saw significant growth in 2022 despite economic difficulties. The entertainment sector, in particular, experienced tremendous success with impressive numbers..
In 2022, the gaming industry generated an impressive $127 billion through 1320 deals announced and closed. This figure includes Mergers & Acquisitions, Public Markets, and PP. The most notable deal was Microsoft\’s acquisition of Activision, despite the controversies surrounding it. Additionally, Take-Two acquired Zynga, Unity acquired ironSource, and Sony acquired Bungie. The industry also saw significant investment, with companies such as EPIC Games and the blockchain sector raising large sums of money. Download the report.
Record-Breaking Deals and Promising Growth in the Gaming Industry in 2022
The year 2022 saw a number of significant deals in both Mergers and Acquisitions and Private Financings. M&A value experienced a marked increase of 3 times compared to 2021, reaching a total of $102.3 billion. The PC and console gaming led with 83 deals, followed by platform tools with 75 deals. Mobile gaming also saw a significant number of deals, totaling 75. The overall deal volume remained consistent throughout the year. In the blockchain gaming sector, there were 17 M&A deals.
In terms of private placements, a total of 938 deals were completed, amounting to $11.1 billion. The blockchain gaming sector had the highest number of deals, closing 405 deals with a total value of $3.9 billion. PC and console gaming followed with 123 deals, and mobile gaming had 152 deals. Within the blockchain gaming and NFT gaming private placements, Animoca Brands was the top performer. In 2022, Animoca Brands\’ deal value reached $358.9 million with a total valuation of $5358.9 million. The company\’s investors included Liberty City, Sequoia, and Mirae Investment. Other notable companies in this field include Immutable, LootMogul, LimitBreak, and Sky Mavis, among others.
Key Takeaways of Q4 of 2022
In the fourth quarter of 2022, M&A activity remained consistent and saw Meta making several acquisitions of VR game developers such as Camufloj, Armature Studio, and Twisted Pixel. These developers have contributed to popular VR games like Resident Evil 4 VR and Iron Man VR.
Furthermore, video streaming giant Netflix ventured into gaming by purchasing Cozy Grove and SpryFox, the developer of Alphabear. Other notable M&A activity in Q4 includes Google\’s acquisition of AI avatar company Alter for $100 million, Playstudios\’ acquisition of mobile game developer Brainium for $93 million, Keyword Studios\’ acquisition of Helpshift for $75 million, and Fandom\’s acquisition of Gamesport, Metacritic, Giant Bomb, and others for $55 million.
In terms of fundraising, the blockchain gaming industry saw Horizon raise $40 million. Traditional gaming companies also had a successful year, with Fenix Games raising $150 million with the intention of using the investment to bring blockchain games to market. Another major fundraising was Homa Games, which raised $100 million in a Series B round led by venture capital firms Quadrille Capital and Headline.
In addition to fundraising, there were also several gaming companies that went public in 2022. Wemade, a blockchain gaming company, raised $50 million through its public offering. Infinite Reality also went public through a SPAC deal with Newbury Street acquisition company. Similarly, Snail Games also made its public debut on Nasdaq with a $190 million valuation, raising $15 million.
The gaming industry had a total of 76 deals announced in Q4 of 2022, resulting in $721 million in disclosed deal activity. The PC and console sector had 15 deals and blockchain gaming had 9 deals. North America had the most deals with 31, Europe had 25, and Asia and other regions had 20 deals.
What does the 2022 Gaming Report Predict about 2023?
The report predicts that the gaming industry will continue to see diversification, consolidation, and investment, but at a slower pace. The focus in 2023 will be on AR/VR and AI technologies, but there is also expected to be a significant amount of activity in M&A, particularly within the mobile gaming sector.
The report also notes that Embracer, Sony, Microsoft, Tencent, and T2 will continue to be major acquirers in 2023. Furthermore, the blockchain gaming sector is expected to see an increase in high-quality games as the $13 billion raised in 2022 is utilized. The report predicts that we will see a first consolidation phase in blockchain gaming this year. Overall, the report highlights many positive developments for the gaming industry as a whole and the blockchain gaming sector in particular.
The blockchain sector is also introducing new technology and methods to curb the problem of losing funds via hacking and or personal error. Check out our article on Account Abstraction and how this technology can work in the best interest of investors.