Social gaming firm Rec Room valued at $3.5bn in Coatue-led funding round

Dec 20, 2021 | News

Social gaming platform Rec Room said on Monday it fetched a valuation of $3.5 billion after raising $145 million in a funding round led by hedge fund Coatue Management, riding on the pandemic-fueled boom in digital entertainment.

Other existing investors who participated in the funding round included Sequoia Capital, Index Ventures and Madrona Venture Group.

The Seattle-based company, which allows users to create customizable and interactive gaming rooms, said it currently had more than 37 million people on its platform. It added that the number of monthly users had surged by nearly 450% since November 2020.

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Founded in 2016, Rec Room’s free platform is available on mobile devices, game consoles, PCs and VR headsets. The company had last raised $100 million in March, when it was valued at $1.25 billion.

The valuations of firms offering digital connectivity to consumers have jumped this year as pandemic-related closures drove more people online.

Companies in the automotive, aviation and technology sectors have started to dip their toes in the so-called “metaverse,” a shared digital space often using virtual reality or augmented reality accessible through the internet.

Niantic Inc., the AR platform behind Pokemon Go, raised $300 million from Coatue at a valuation of $9 billion last month.

In September, messaging platform Discord raised $500 million in a funding round, valuing the social networking company at about $15 billion, according to media reports.

Source: Union Leader

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