Fortnite creator, Epic Games recently announced a $1 billion raise in a late stage venture capital round.
The company is now valued at around $28 billion, making it one of the single most valuable privately held companies on earth.
This new valuation makes Epic Games nearly as valuable as publicly traded gaming titan, Electronic Arts with their $35 billion valuation. And it’s no wonder, Fortnite is one of the most popular games globally, generating over $2 billion in annual revenues.
Epic Games famously took on Google and Apple to push the app store giants into lowering their commission structures. This has not only benefitted Epic by greatly trimming costs, but every app developer will now be paying less to Google and Apple for their users in-app purchases. This was a big win for the mobile gaming industry as a whole.
Epic Games’ Unreal Gaming Engine, the software that runs Fortnite, is also a big revelation to their value. Epic licenses out Unreal to other gaming companies/publishers, generating huge revenues for Epic. And they do this without incurring further capital cost. Instead, they collect royalties from each developer utilizing Unreal.
Last year, when Unreal Engine 5 was released, Epic was valued at $15 billion. Since that launch, the company has nearly doubled in value.
Licensing agreements are big business in the mobile gaming space. Companies with highly desirable and proprietary products available for licensing may be the next to receive astounding valuations.
Read more about Epic’s huge valuation HERE
SOURCE: https://www.brownstoneresearch.com/bleeding-edge/epic-games-latest-raise-signals-potential-ipo/