Epic Games, the publisher of the popular video game Fortnite and creator of the Unreal Engine graphics software that is popular with Hollywood, has raised $2 billion in a new fundraising round from Sony Group Corp. and KIRKBI, the owner of the Lego toy and entertainment brand.
Epic says it will use the cash infusion to work with its investors and “create new social entertainment exploring the connection between digital and physical worlds.” Yes, it’s about the metaverse.
Sony and KIRKBI will each contribute $1 billion in the round, which values Epic at $31.5 billion. Epic last raised cash in May of last year at a $28.7 billion valuation. Sony was also part of that round. Epic founder and CEO Tim Sweeney remains the controlling shareholder of the company.
“This investment will accelerate our work to build the metaverse and create spaces where players can have fun with friends, brands can build creative and immersive experiences and creators can build a community and thrive,” said Sweeney in announcing the deal.
Epic has seen record-smashing growth in recent years, driven by Fortnite and the continued expansion of Unreal. The company has also been on the hunt for acquisition, most recently the music and artist community platform Bandcamp, just last month.
But it has also faced public scrutiny, driven by its antitrust lawsuit against Apple. The gaming company argued that Apple’s 30 percent cut of purchases was monopolistic. In trial, a judge ruled that Apple was ok to charge a commission, but found that the tech giant’s anti-steering rule (which said that companies like Epic couldn’t direct users to their website to pay for a subscription or content) was inappropriate.
“As a creative entertainment company, we are thrilled to invest in Epic to deepen our relationship in the metaverse field, a space where creators and users share their time.” said Kenichiro Yoshida, chairman, president and CEO of Sony Group Corp., in a statement. “We are also confident that Epic’s expertise, including their powerful game engine, combined with Sony’s technologies, will accelerate our various efforts such as the development of new digital fan experiences in sports and our virtual production initiatives.”
The deal with KIRKBI was foreshadowed last week, when Lego and Epic announced plans to create an “immersive, creatively inspiring and engaging digital experience” for kids and families.
“:A proportion of our investments is focused on trends we believe will impact the future world that we and our children will live in,” KIRKBI CEO Søren Thorup Sørensen said. “This investment will accelerate our engagement in the world of digital play, and we are pleased to be investing in Epic Games to support their continued growth journey, with a long-term focus toward the future metaverse.”
This article was originally published by The Hollywood Reporter.