… would PopCap be able to get a premium multiple? I think it would be difficult.PopCap Games, Inc. “Otherwise, what are the valuations and market caps for these companies? They’re pretty small. “I think investors would rather see some consolidation and the formation of a critical mass – and then you could go public,” says Eric Handler, senior equity analyst for MKM Partners. Should PopCap use this money to buy some of its bigger competitors, though, things could quickly change. It’s a notable number for any game – but even moreso, when you consider that all of PopCap’s games retail for $20 or below – just one-third of what other publishers charge.īut when compared to the revenues of an EA or Activision, it’s a pittance – which could work against the company if it decides to go public. The “Bejeweled” franchise, meanwhile, has generated sales of more than $300 million life to date, along with tens of millions of dollars more in online advertising revenue. That propelled the company into the list of the industry’s top 20 publishers. In January, of this year, it did report that 2008 revenue was up 85 percent over 2007 – with the largest growth coming in the fourth quarter. Beyond its significant online presence, its games are sold in more than 20,000 retail locations.īecause it’s privately held, the company does not release precise sales figures.

With its track record, PopCap might also be an attractive play for investors. PopCap’s games are on all of those platforms – but to be able to offer them exclusively would be a big coup.

The growing importance of casual games to the industry, though, may put increased pressure on the company.īeyond the audience of casual gamers Nintendo has brought to the industry, several other companies, including Electronic Arts, Microsoft and Yahoo, have substantial casual gaming arms. PopCap has, in fact, regularly been approached by larger publishing companies about a possible buyout – but has always opted to remain independent.

After all, most VCs come in with an exit strategy of either IPO or sale in mind.īoth are possible. With the infusion of venture money - particularly from a late-stage investment company like Meritech – whispers have already started about what the future might hold for PopCap.

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