Social Gaming Gets Funded [updated 10.28.08]

After virtual worlds and casual gaming, now emerges social gaming. Over the past couple of weeks a bunch of startups have come into some money by way of venture capital. So, what is this social gaming, who’s building it, and who’s funding it?

The term ‘social gaming’ seems somewhat superfluous: a game is inherently social because it either involves more than one person to play, or a larger socio-cultural context informs its game mechanics. But, whatever. This is not a philosophical explication of a definition: social gaming refers to games played on social networking platforms, like Facebook.

For example: in the browser-based Disco Fish II on Facebook, you are a medium fish that eats smaller fish, but must avoid being eaten by bigger fish. Simple enough. You can then challenge your friends to beat your score.
Sounds lame? It is. No different than the host of low-grade flash-based games on other sites, this type of game play makes up most of what social gaming seems to be all about. However, amidst the many mediocre titles, a few companies are now developing some more high-quality games.

According to Jeremy Liew, Social Gaming Pwns the Industry, because this type of game is much cheaper to develop, racks up lower marketing and distribution costs, and is not tied to the old line retail model.

Most recently the following companies received a bunch of money (alphabetically):

Iminlikewithyou: $1.5 million (June 2008)
Based in New York, this portal of sorts started, as the name suggests, more as a dating site. But, water flows down the hill, and so now it’s about gaming. At least that’s what Spark Capital, Baseline Ventures and Betaworks, and angel investors Ron Conway and Marc Andreessen (Netscape, Ning) hope. Not bad considering Charles Forman, its founder, is nuts: “Forman told CNET that the entirety of the $1.5 million would be used to throw a large-scale party.” <source:>

Playfish: $1 million (July 2008); $3 million (earlier)
London-based, (with studios in Norway and Beijing) the company claims its 6 million players play 100 million games per month for 300 million minutes. That sounds like a lot.

Update [Oct 28, 2008]: In a series B round, led by Accel Partners and Index Ventures, Playfish just received another $17 million. Apparently, social gaming is “casual gaming for the common man.” Not sure what that means. While Playfish wouldn’t comment on the $1 million/month speculation by TechCrunch UK, it seems the company is doing well enough to become one of the three biggest social gaming companies in terms of received funding (Zynga and SGN are the are two).

Social Gaming Network (SGN): $15 million (series A funding, May 2008)
Christmas showed up in May as SGN received a big ol’ check from a selection of investors, among which Grey Lock, The Founders Fund, Columbia Partners and Novak Biddle Venture Partners.

Zynga Game Network: $10 million (Feb 2008)
Among the benefactors are VCs such as Avalon Ventures, Foundry Group, Union Square Ventures, Clarium Capital, but also notable figures like Hoffman (chairman of LinkedIn) and Bob Pittman and Andy Russell (MTV, Century 21, AOL).

The big question is whether or not social gaming can graduate beyond being a mere add-on. Obviously once a substantial community emerges, people start playing. But does it warrant an industry of its own?

Discussion (1 comment)
Microkid July 19th, 2008 (9:20 pm)

Looks like the halo of the whole social network thing. VC’s appearently found a new hole to dump their endless amounts of money. In concept, there’s not much difference with this and common online multiplayer gaming, except for the platform and, what this is all about, its reach.

The quality of the games is obviously bad. The companies are probably only interested in the before mentioned reach, so I doubt they’ll put the money in improving the game quality.

I can see the social function in wanting to be the biggest fish in your friend network though.

Your comment

About Waffler

Joost is fascinated by games and human behavior. His research explores video games as an entryway to contemporary media culture. After completing a Master's degree in Media studies in Amsterdam, he continued his research in New York. There he was project manager on a landmark investigation of three decades of ownership trends in the American media landscape, the results of which were part of a congressional testimony, a series of articles and a book. In 2010 he received his doctorate from Columbia University for his dissertation titled "Social Gaming and Communicative Exchange." Joost currently teaches at the NYU Game Center.

In addition to his academic pursuits, Joost is also founder and CEO of an online games research firm called SuperData. In early 2010 the company secured multi-year seed funding, and today employs five people. Clients include publishers such as Electronic Arts, SEGA, and Pokémon as well as all the major Wall street firms.

Joost lives in the East Village with his wife Janelle and son Maximus.

Selected Presentations
  • Video Game Data & Trends, Ottawa International Game Conference, Canada, 2013.
  • Business Principles and Market Trends for Multi-Platform Games, Festival of Games, Amsterdam 2013.
  • 2013 Game Changers: How Will Devices Impact Your Future Growth? (keynote), Game Developer Conference, 2013.
  • Free-to-Play State of the Industry, Game Connection Paris, 2012.
  • Online Games Research: Getting Publishers to Play Nice, New Media, New Demand Measurement Methodologies, 2012 Columbia University.
  • The Great Unboxing: Major Trends in the Transition to Digital and Free-to-Play Gaming, DCM East, 2012.
  • The Rise of Free-to-Play, moderator and co-organizer, Re:Play - The Theory, Practice, and Business of Video Games, 2012, NYU.
  • Trading Card Games: Delivering the Digital Promise, PAX East, 2012.
  • From Asteroids to Zynga: Three Decades of Game Design and Revenue Models, GDC Online, 2011.
  • Video Game Industry, 2010 Fordham University, 2010.
  • Social Media and TV, LATVfest, 2010 Los Angeles.
  • Top 5 Trends in Gaming, NY Games Conference, New York, 2009.
  • Kids, Tweens & Teens, State of Play IV, New York Law School, New York, 2009.
  • Game Theory, Play Money, Columbia Business School, New York, 2008. (event organizer)
  • Media Economics: The Question of Ownership, Hunter College, New York, 2008.
  • On Game Mod Communities, 106th Annual Meeting of American Anthropological Association, Washington, DC, 2007.
  • Game Mods & Post-Industrial Play, CITI Visiting Scholar’s Brown Bag Lunch Seminar Series, Columbia Business School, New York, October 2007.
  • The Video Game Vocabulary and the Production of Meaning, MiT5: Creativity, Ownership and Collaboration in the Digital Age, Massachusetts Institute of Technology, Cambridge, April 2007. (abstract)
  • Cities, Games and Media: Playing with and in the Urban Setting, Time|Space Dynamics in Urban Settings, Technishen Universität, Berlin, May 2007.
  • The Aesthetic Vocabulary of Video Games, Seventh Annual Convention of the Media Ecology Association, Boston College, Chestnut Hill, November 2006.
  • Haussmann’s Media Environment (revised), Sixth Annual Convention of the Media Ecology Association, Fordham University, New York, May 2005.
  • Media Technology & Society: Video Game Theory, Dissertation outline, Columbia University, New York, April 2005.
  • Good Day New York, Fox Television, aired August 20th, debate with Attorney Sanford Rubenstein on videogame violence, August 2004.
Contact: joost at waffler dot org

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