Rec Room social gaming platform raises $145M at $3.5B valuation

Social gaming platform Rec Room has raised $145 million at a $3.5 billion valuation.

The funding spherical comes simply 9 months after the corporate raised $100 million at a $1.25 billion valuation, and it’s one other signal of the prospects for user-generated content material and the sport funding increase.

Rec Room is positioning itself as a contender for the metaverse, the universe of digital worlds which can be all interconnected, like in novels equivalent to Snow Crash and Prepared Participant One.

Customers-as-creators is an enormous theme within the newest gaming increase, which has seen user-generated content material platform Roblox go public and Overwolf increase $127.5 million in two rounds this 12 months for PC gaming mods and helper apps.

“It’s been superb to observe Rec Room develop from a tiny assortment of mini-games into a world platform with thousands and thousands of experiences constructed by the group. The platform has grow to be a spot the place folks can come collectively to type significant connections, construct communities, and share their creativity,” mentioned Rec Room CEO Nick Fajt, in a press release. “There’s nonetheless a lot extra we need to do, and as we head into 2022, we’re excited to construct extra experiences, increase to new platforms, spend money on greatest in school belief and security techniques, and proceed to increase our creator instruments.”

Coatue Administration led the spherical, with participation from current traders Sequoia Capital, Index Ventures, and Madrona Enterprise Group.

“We love the world Rec Room has created for associates to construct and play collectively,” mentioned Matt Mazzeo of Coatue Administration, in a press release. “From telephones to VR, thousands and thousands of gamers are hanging out in Rec Room, and we’re excited to associate with the group as they make the digital world extra enjoyable and immersive.”

Rec Room launched as a free-to-play expertise in 2016, and now it has had 37 million lifetime customers.

It wasn’t straightforward to get right here, as Rec Room began with a concentrate on digital actuality headsets. That market obtained hype 2016, nevertheless it took off extra slowly than hoped. Rec Room pivoted to different platforms, together with sport consoles, PCs, and cellular units.

Rec Room’s month-to-month consumer depend jumped almost 450{69439eabc38bbe67fb47fc503d1b0f790fcef507f9cafca8a4ef4fbfe163a7c5} since November 2020 with cellular customers growing greater than tenfold throughout that very same time. Free to play, Rec Room is accessible on cellular units, sport consoles, PC and VR headsets, together with iOS, Android, Xbox, PlayStation, Oculus, and Steam.

Rec Room has greater than 12 million rooms to discover, and thousands and thousands of gamers have constructed content material in Rec Room.

“We simply we raised final spherical not that way back. And we definitely haven’t spent via that in any method, form, or type,” mentioned Mike Schmid, vp of enterprise growth, in an interview with GamesBeat. “It’s actually concerning the alternative for development proper now. It’s super. We see actual traction relating to efficiency advertising and marketing over the previous like six months.”

That efficiency advertising and marketing obtained a lift this 12 months from Brian Sapp, who beforehand ran advertising and marketing at cellular gaming agency Jam Metropolis.

Above: Rec Room is creating video games equivalent to RecRally.

Picture Credit score: Rec Room

In Rec Room, you’ll be able to social gathering up with associates worldwide, and construct content material together with escape rooms, journey video games, battle royale islands, and birthday events.

This 12 months has been a big 12 months of development for Rec Room. In August, Rec Room launched on Android. And in September, Rec Room launched Rec Rally, a fully-realized, multiplayer automobile expertise to its large world group, enabling gamers to race with as much as six associates.

Rec Room welcomes customers of all ability units and pursuits, with informal areas for newer customers to hang around, in addition to alternatives for extra skilled customers to leverage their abilities and earn cash promoting their creations within Rec Room.

The corporate has almost 200 workers, up from about 60 final 12 months. The corporate transitioned into being a distant firm throughout COVID-19, and it’s hiring folks from across the globe.

“Now we’ve a battle chest, and we are able to develop the corporate and increase our capabilities on the identical time in parallel,” Schmid mentioned.

The corporate might also do some acquisitions, although it isn’t essentially constructing a portfolio of its personal video games, as customers present most of that.

“What we take a look at is the methods can we velocity up via acquisition,” Schmid mentioned.