Animoca Brands acquires Pixowl to advance blockchain as the next frontier in mobile gaming
Animoca Brands will acquire Pixowl, which is developing a version of The Sandbox for blockchain with the new version one the world’s 10 most anticipated blockchain games.
Games developer Animoca Brands (ASX: AB1) has laid out plans to absorb Pixowl for around US$4.875 million (A$6.65 million), paid with US$519,512 in cash and the rest in shares.
Pixowl is an independent mobile game company based in San Francisco but also operates a development studio in Buenos Aires, Argentina. It specialises in developing and publishing what’s known as “world builder” games, with its most valuable intellectual property being The Sandbox, a 2D pixel-based world creation game that is among Pixowl’s most successful titles.
The US game company is cash-flow positive having generated US$1.8 million (A$2.46 million) in revenue in the first half of 2018 and holding cash equivalents of approximately US$420,000 (A$573,300).
Developing The Sandbox
The Sandbox is one of the world’s largest independent user-generated content platforms and gaming ecosystems, with 40 million downloads and over one million monthly active users. In aggregate, the platform has led to the creation of 100,000 new worlds and 25,000 new world elements on a daily basis, according to Pixowl.
Given Pixowl’s market positioning, its acquisition is expected to enhance Animoca’s operational base and mobile development proficiency that will effectively generate new games and continuous technical support to create future versions and adaptations.
The deal also means that Animoca will obtain an experienced development team that will help to lower the company’s average operational costs while increasing their capabilities – including the development of games contingent on blockchain technology.
In a statement to the market, both the founders of Pixowl and the management of Animoca said they expected the acquisition to provide “significant synergies and strategic value”.
“Animoca Brands is a perfect fit for Pixowl and we are happy to add our brand relationships to its portfolio while accelerating growth for our key IP, The Sandbox, with a new 3D version that will integrate blockchain technology and demonstrate our vision of a next-generation user-generated content gaming ecosystem,” said Arthur Madrid, chief executive officer and founder of Pixowl.
Blockchain development work
Pixowl has already announced it is developing a version of The Sandbox for blockchain, expected to launch sometime in 2019.
The first milestone in late 2018 will be the launch of the world’s first marketplace for “user-generated non-fungible tokens” (NFTs), where players will trade game assets and monetise the time and effort they have invested playing.
The popularity of blockchain-based games is expected to be significant given the community features that the technology can offer.
According to gaming news hub BlockchainGamer.biz, the blockchain version of The Sandbox is “one of the top 10 most anticipated blockchain games in the world”.
In addition to The Sandbox, Pixowl makes and distributes other mobile titles in its portfolio which Animoca says “align well” with its own strategy, including both original and licenced brand titles like Peanuts: Snoopy’s Town Tale, Garfield: Survival of the Fattest, and Goosebumps: HorrorTown.
Two additional titles featuring popular brands The Loud House and WonderPark are in development and scheduled for launch later in 2018 and 2019.
“Pixowl’s experienced developers will significantly increase our development capabilities. Its founders are highly respected game industry veterans who have developed multimillion dollar franchises. We believe the blockchain version of The Sandbox has incredible potential,” said Yat Siu, co-founder and director of Animoca.