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 News.com that the entirety of the $1.5 million would be used to throw a large-scale party.” <source: http://news.cnet.com/8301-13577_3-9978390-36.html?dlbk>

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?