The gaming industry is undergoing a transformative era, fueled by technological advancements, increasing user base, and innovative business models. One leading investor at the forefront of this shift is Bitkraft Ventures, a Denver-based games investor with European founders. Bitkraft recently announced its plans to raise a third fund, and the question at hand is: what is the focus of Bitkraft Ventures’ third fund, and in which gaming studios and platforms will it invest?
Founded by games industry veteran Jens Hilgers, Bitkraft boasts a robust portfolio of over 130 companies and more than $1 billion in assets under management. With an impressive track record, Bitkraft Ventures continues to demonstrate its ability to identify and invest in successful gaming studios and platforms, setting the stage for its third fund.
The investment climate in the gaming sector is vastly different from what it was just a few years ago. According to PitchBook, games investments have experienced a significant contraction, down 72% year-on-year. Despite the decline, Bitkraft Ventures sees this as an opportunity to invest in high-quality gaming assets at potentially attractive valuations.
The focus of Bitkraft Ventures’ third fund is to make seed and Series A investments in gaming studios and platforms. With a diversified investment strategy, Bitkraft is well-positioned to capture opportunities across various sub-sectors within the gaming industry, including real-time strategy games, in-game advertising platforms, and mobile gaming platforms.
One area showcasing potential for Bitkraft Ventures is real-time strategy games. The firm recently disclosed its excitement for Frost Giant, a studio headed by a team with a proven track record in developing hit real-time strategy games. The Frost Giant team, which previously contributed to the success of StarCraft, is currently working on Stormgate, a highly anticipated game in the real-time strategy space.
Another investment area for Bitkraft Ventures is in-game advertising platforms. The adoption of live services and free-to-play games, combined with ever-growing user bases, presents massive revenue potential for in-game advertising. Anzu, a Bitkraft investment in an in-game advertising platform, is making strides in this space by offering non-intrusive, player-focused advertising solutions, which are becoming increasingly important as user experience becomes a greater priority.
Furthermore, Bitkraft Ventures has also shown interest in mobile gaming platforms, particularly those focusing on emerging markets. An example of this is Carry1st, a mobile gaming platform targeting Africa. Africa’s expanding population and increasing digital penetration offer immense opportunities for gaming companies. Carry1st’s affordable, pay-per-day subscription model appeals to both developers and users, making it an attractive investment opportunity for Bitkraft Ventures.
Innovative business models and emerging technologies, such as the intersection of gaming and blockchain, are also areas of interest for Bitkraft Ventures. An investment in Immutable, the creator of the crypto-based game Gods Unchained, highlights the firm’s desire to capitalize on the potential growth in this space.
With a solid LP base consisting of family offices and institutional funds, Bitkraft Ventures’ reputation in the gaming industry continues to grow. The firm’s latest investment includes a major global sportswear player, further bolstering its expertise and resources. This strategic partnership provides valuable industry insights and potential synergies between gaming and sports, expanding Bitkraft’s investment landscape and enhancing its positioning within the industry.