Epic Games has raised $2 billion from Lego owner Kirkbi Invest and Sony as the trio eyes opportunities to build virtual experiences that will lay groundwork for the metaverse.
The deal increased Epic's post-money valuation to $31.5 billion, indicating less than $1 billion in organic valuation growth since April 2021—a slower pace relative to the company's reported valuation growth in prior years.
Late-stage valuations have come under pressure in recent months because of public stock declines. The gaming industry is also contending with less rapid growth than it saw during the early days of the pandemic. Epic rival Roblox's market capitalization has fallen more than 42% since its direct listing in March 2021, from $45.3 billion to $25.9 billion today.
The new investment supports Epic's efforts to build "social entertainment" experiences—not just games—for adults and children, in coordination with strategic partners. Sony, which has invested in Epic before, plans to leverage the company's game engine to create virtual sporting events and other experiences.
Epic and Lego also recently partnered to build digital experiences aimed at children, illustrating a metaverse that would be more focused on creativity and play than traditional gaming. And, in another sign of broadening ambitions, Epic Games acquired music marketplace Bandcamp in March.
Game developers have walked a cautious line in describing their visions for the metaverse. Many gamers remain skeptical of NFTs and other metaverse-adjacent technologies that are seen as money-makers for developers but currently add little value for gamers.
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This article originally appeared on PitchBook News