Warner Music Group has been inching significantly closer to the gaming world in 2021.
The music company’s first move in the space this year came in January, when it made an investment in kids’ gaming phenomenon Roblox.
Warner joined a $520m Series H investment round in Roblox Corporation at a purchase price of $45.00 per share.
WMG is understood to have invested an eight-figure sum in the company.
At the time of writing (November 15 at 11am ET), Roblox – which went public in March having reached a $45 billion company valuation – is trading at $105 a share with a market cap of $60.49 billion.
This means that Roblox’s share price has more than doubled since WMG bought a minority interest in the company in Q1 2021. (Much of this bounce is due to Roblox’s strong calendar Q3 results, which sent the firm’s share price rocketing up 42% last week.)
Following Warner Music Group’s successful investment in Roblox, this week brings news of WMG backing yet another company that is building buzz around it in the games industry.
WMG has joined a $725 million Series B financing round in technology firm Forte, which runs a platform that lets developers of interactive entertainment integrate blockchain-powered economic features into their games.
Led by Sea Capital and Kora Management, other participants in the round include Animoca Brands, Big Bets (Huuuge Games), Overwolf, Playstudios, zVentures (Razer), and blockchain partners Cosmos, Polygon Studios, and Solana Ventures, as well as investors including Griffin Gaming Partners, Andreessen Horowitz (a16z), and Tiger Global.
One of those new investors, Israel-based Overwolf, which lets creators build, distribute, and monetize in-game apps and mods, actually also counts WMG as a backer, with the major having joined a $52.5 million Series C funding round in the gaming UGC platform in March.
Other gaming-related tie ups WMG has been a part of this year include joining a $5.2 million seed funding round for US-based games developer and publisher Supersocial, which builds games and experiences for the Roblox platform.
Plus, just last week, WMG partnered with Niantic, the creator of augmented reality game Pokémon GO, on the global launch of its Lightship platform, which will give developers access to the technology behind the game.
Forte is currently an invite-only platform, and is, at present, in private testing. It lets game publishers integrate blockchain-powered financial tech into their games, enabling features such as token wallets, non-fungible token (NFT) minting and selling, payment rails, and other services built specifically for blockchain token economies and the management of digital and virtual assets.
According to Forte, blockchain-enabled games allow players to “truly own goods, rather than making pure entertainment expenditures”.
The firm says that it is working with over 40 game developer partners right now, with more than 15 million players across these partners’ games.
In May, Forte raised $185 million in its Series A, at a $1 billion valuation, led by Griffin Gaming Partners. Today’s announcement brings Forte’s total capital raise to more than $900 million in 2021.
Forte also provides game publishers built-in compliance and security products, ensuring global frameworks for regulated activity including money transmittal, anti-money laundering, tax compliance, and IP protection in order to protect both players and publishers’ businesses and intellectual properties.
“We believe we are at the forefront of a new technological wave, and blockchain gaming will be even bigger than all the shifts we’ve seen before.”
Josh Williams, Forte
Forte co-founder and CEO Josh Williams, said: “Over the past 50 years, games have undergone seismic shifts in their business and revenue models, becoming more aligned with players at every turn
“First there were arcade games, where players had to essentially pay per minute of play. Then came home console and PC games, where gamers could play as much as they want after paying once.
“Next, games moved online and the free-to-play (F2P) model allowed gamers to play even AAA games as much as they want for free, with only optional in-game / in-app purchases.
Added Williams: “The games industry has grown at each turn as it aligns more and more closely with players, and today it is the largest form of entertainment globally – larger than film and music combined – with nearly $180 billion in annual revenue.
“We believe we are at the forefront of a new technological wave, and blockchain gaming will be even bigger than all the shifts we’ve seen before.
“Forte’s mission is to prepare all game developers, big and small — whether you already have a AAA title with millions of players or you are building a blockchain game from the ground up – to be successful in this new landscape.”
“Publishers can grow their businesses with new, innovative technical solutions, and business models. Players are now able to truly own their in-app purchases and virtual goods. This is a win for the entire ecosystem.”
Daniel Jacobs, Kora Capital
Daniel Jacobs, Kora Capital’s founder, added: “Forte has incredible traction in the gaming space, due in part to the robustness of its technical and compliance solutions.
“We partnered with Forte because of its ethos of building a platform that is simple to integrate without limiting developer flexibility or control, building for the long-term, solving scalability challenges that limit transaction throughput on blockchains today, mitigating high latency and costs associated with blockchain transactions, as well as future-proofing with blockchain portability and cross-chain interoperability.
“Publishers can grow their businesses with new, innovative technical solutions, and business models. Players are now able to truly own their in-app purchases and virtual goods. This is a win for the entire ecosystem.”Music Business Worldwide