Viacom's on the move: picks up Xfire for $102M
Xfire, a company that has developed a rich community for online gamers, has just been acquired by Viacom for a $102M in cash. XFire had 4M registered members, 1M active users, and an ad-supported business model. Out of the press release:
The acquisition brings Viacom and its MTV Networks unit the premier community that connects online gamers. Xfire and its users fit squarely into the Company’s multiplatform strategy to build an engaging universe of music, gaming, entertainment, news, networking and interactivity for focused audiences. As part of MTV Networks, Xfire will be better able to maximize its advertising revenues through more aggressive marketing, greater global penetration and comprehensive integration with the Company’s other digital and cable properties that address the gaming demographic.
Launched in 2004, Xfire has four million registered members who use its software. Its one million active users average 91 hours per month, with an average session length of over three hours. The robust, ad-supported Xfire application supports hundreds of the latest PC games and provides social networking, instant messaging and information for online gamers. In addition, the Xfire application provides traffic to its popular website, featuring forums and gaming downloads.
Xfire had received between $10M and $20M (?) in funding from DFJ, NEA and Granite Global Venture (Series C of $5M in 2004, Series D of $5M in 2005) plus several million dollars in their Series A & B (which I could not find exact information about) when they were still called Ultimate Arena. Xfire was actually featured this month in the DFJ newsletter (scroll down).
This exit is providing useful data points for our team at Userplane (Disclaimer: one of the companies I am involved in), that now supports over 100,000 communities with its Flash-based IM and chat room service - including MySpace, Friendster and most brands in the online dating world. Already profitable, and without any VC funding, the company has found ways (i.e revenues) to grow organically into supporting millions of users. Esther Dyson recently met with CEO Mike Jones and has a nice write-up on her Flickr blog.
MSFT acquires Massive for upwards of $400MM
http://biz.gamedaily.com/industry/feature/?id=12519
I heard it was a very limited revenue base. What a great area to have investments in. I will shamelessly now promote Jagex makers of Runescape (www.runescape.com) and one of my firm's portfolio companies.
What do you think of the Massive Acquisition?
Posted by: Brad Twohig | April 26, 2006 at 10:49 AM