Andreessen Horowitz (a16z), a venture capital firm, has announced a $600 million gaming fund with an emphasis on Web3, claiming that “games infrastructure and technologies will be fundamental building blocks of the Metaverse.”
The fund, dubbed GAMES FUND ONE, will invest in three areas: game studios, consumer applications that promote player communities (such as Discord), and gaming infrastructure suppliers.
“The coming Metaverse will be constructed by games firms, utilising games technologies,” according to the a16z team, who also claim that the industry has already “fixed 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 decentralised finance (DeFi) and game-focused fund in April 2022, while Framework Ventures will allocate $200 million to blockchain gaming ventures.
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 construct a metaverse.
The a16z team cited the billions of dollars in 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.
Although this is a16z’s first fund dedicated purely to games, the business has previously funded successful game-related companies such as virtual reality (VR) company Oculus and game producer Zynga, stating that the investments “cemented our opinion that games deserve a specific focus.”
Founders of game development companies and popular games such as Riot Games co-founder Marc Merrill, Sky Mavis co-founders Aleks Larsen and Jeffrey Zirlin, who own the popular Axie Infinity blockchain game, and Kevin Lin, founder of gaming company Metatheory, which received $24 million in a funding round led by a16z, joined the fund.
To read our blog on “The US military is creating its own metaverse,” click here.
