Epic Games has announced $1.25 billion in investment from a multi-group consortium, joining Tencent, Disney, and Endeavor as minority shareholders in a company still controlled by its founder and chief executive Tim Sweeney.
Founded in 1991 as Potomac Computer Systems, a computer consulting business turned games publisher for Tim Sweeney's first title ZZT, Sweeney's company would be rebranded to Epic MegaGames when the success of its game offering - shipped by hand by Sweeney's father, Paul Sweeney, based on orders placed through public bulletin board systems - outweighed its consultancy work. The company would continue under that name, releasing games under a primarily shareware model, until the success of first-person shooter Unreal in 1998 triggered another brand shift a year later to its current moniker of Epic Games.
In the years since its founding, Epic has gone from strength to strength: The company grew from a one-man-band in 1991 to 700 employees around the world, and its success didn't go unnoticed: Chinese gaming giant Tencent acquired just under half of the company in 2012, and currently holds around 40 percent of the company, giving the company the capital it needed to release its Unreal Engine game engine under a free-to-develop licence which sees the company taking no cash up-front and just five percent in royalties when sales exceed a set volume. At the same time, though, some high-profile names departed: Design director Cliff 'CliffyB' Bleszinski, president Mike Capps, and founder of People Can Fly, the studio acquired by Epic earlier that year, Adrian Chmielarz.
With the release of Fortnite's Battle Royale mode, an abrupt shift from the game's original Save The World cooperative multiplayer design, Epic's success increased once again: The free-to-play game is estimated to have pulled in more than $1 billion in microtransactions since its launch, which drew the attention of Disney in 2017 adding yet more capital and access to the company's executive talent.
Now, Sweeney has announced yet another investment of cash from a selection of investment vehicles, totalling $1.25 billion. 'We're excited to partner with the finest minds in the financial, sports, and entertainment communities,' claimed Sweeney of the latest round of funding, which sees him retain overall control of the company he founded. 'This reinforces Epic's position of leadership in real-time 3D technology, and accelerates our ability to improve the way people play, work, and interact with the world.'
'Epic Games has fundamentally changed the model for interactive entertainment under the company's visionary leadership,' adds Ted Oberwager, of investment group KKR. 'Alongside a special group of investors, we are thrilled to support Epic's dedicated employees and the passionate community of players and developers that lies at the heart of everything that Epic Games does.'
The precise capital provided for the investment has not yet been publicly declared by the company.
February 26 2021 | 22:15