$3 Billion Will Be Invested In Metaverse And Web3 Gaming, As A16z Brings In An Additional $600 Million
The gaming industry beats predictions and is expected to be worth $200 billion by 2024. Pay-to-Play requires payment to access, while Free-to-Play became popular in the year 2000.
The Rise Of Metaverse And Web3 Gaming
The Play-to-Earn (P2E) revolution has fundamentally changed the dynamics of traditional gaming, fusing the best of both P2P and F2P models.
The Play-to-Earn (P2E) revolution has fundamentally changed the dynamics of traditional gaming, fusing the best of both P2P and F2P models.
In addition, the P2E paradigm has been used in blockchain games, giving players a realistic way to monetize their skills and gaming time. Many blockchain gaming businesses have swiftly gained popularity among gamers and NFT lovers as a result of this shift.
The blockchain gaming industry is expected to be worth USD 1.5 billion in 2021, and NFT-based games like Axie Infinity, K4Rally, and Sandbox are gaining popularity.
A16z’s Tips In $600M
Games Fund One will invest in game companies, consumer apps, and gaming infrastructure providers, with a16z, saying the sector has “fixed many of the difficulties” required to create a metaverse.
Andreessen Horowitz (a16z), a venture capital firm, has announced a $600 million fund devoted to gaming businesses with an emphasis on Web3, claiming that “games infrastructure and technologies will be critical building blocks of the Metaverse.”
The fund, dubbed Games Fund One, would invest in three primary areas: game studios, consumer applications — such as Discord — and gaming infrastructure companies.
“The coming Metaverse will be constructed by games firms, utilizing games technologies,” the a16z team stated, adding that the sector has “addressed many of the challenges that need to be solved to create the Metaverse.” It predicts that video games would become the “dominant way people spend their time.”
Since mid-April, almost $3 billion has been invested in Web3 gaming or metaverse initiatives by venture firms and gaming industry titans.
White Star Capital will raise $120 million for its decentralized finance (DeFi) and game-focused fund in April 2022, while Framework Ventures will allocate $200 million to blockchain gaming ventures.
Further, the Gaming industry titans are also investing heavily in metaverse projects. Epic Games, the maker of the popular Fortnite game, raised $2 billion in funding from Sony and Lego last month to create a metaverse.
The a16z team cited the billions of dollars in the income generated by games like Minecraft, citing the open-world game as an example of a title with a long-standing active community that works more like a social network.
Despite being released almost 11 years ago, Minecraft is the current all-time best-selling game, with 173 million average monthly users over the past 30 days, according to information from game statistics platform ActivePlayer.
The fund is a16z’s first dedicated purely to games, but the firm has previously funded successful game-related projects such as virtual reality company Oculus and game producer Zynga, stating that the investments “confirmed our opinion that games deserve a specific focus.”
Aleks Larsen and Jeffrey Zirlin, co-founders of Sky Mavis, which owns the popular Axie Infinity blockchain game; Marc Merrill, co-founder of Riot Games; and Kevin Lin, founder of gaming company Metatheory, which received $24 million in a funding round led by a16z, are among those who have joined the fund.
