ProbablyMonsters Raises $200M, the Largest Series A in Gaming History
Seattle-based video game startup ProbablyMonsters launched from stealth mode a little less than two years ago. Although the company had been operating quietly since 2016, the news made a splash thanks in part to the fact that former Bungie CEO and president Harold Ryan was at the helm of the new company, along with a team of seasoned video game professionals.
ProbablyMonsters has grown at a rapid pace since then, and now it’s ready to announce a major milestone. On Wednesday, ProbablyMonsters revealed that it raised $200 million in a Series A funding round led by LKCM Headwater Investments. According to the company, this is the largest Series A raised to date in the gaming industry, dwarfing the $18.8 million seed funding round ProbablyMonsters announced in July of 2019.
ProbablyMonsters set out to build a different type of video game company. Instead of falling into either of the traditional video game publisher or video game studio roles, ProbablyMonsters is a vertically integrated company, where it will build and spin out in-house studios to develop games, while ProbablyMonsters itself will handle things like staffing, creative development and other aspects of managing these studios. So far the company has spun out three distinct studios, including Cauldron Studios, Firewalk Studios and an unnamed RPG studio.
When Built In spoke with Ryan in 2019, he talked about placing a special emphasis on building the right culture for the company. The video game industry is notorious for placing a lot of pressure on workers, with heavy workloads, tight deadlines and “crunch.” But ProbablyMonsters wants to break that gaming industry stereotype by placing its people first. And a portion of this Series A funding will be put toward just that — investing in people benefits.
“We raised these funds this year to fuel our long-term stability and predictability for our people benefits throughout the company. We can now provide our teams with more stable and sustainable gaming careers. This is important to me as someone who grew up in Spokane and is deeply rooted in the Pacific Northwest gaming community. The raise allows us to invest directly into our employees — to make commitments that go beyond any single game or partner and know that every job we offer is a path to a healthy long-term career,” Ryan told Built In.
He added: “Similar to our business growth, we are continually scaling up and expanding the benefits. In addition to a competitive benefits package, we’re adding additional layers like childcare, a college savings plan, and helping employees plan by providing legal and financial consultation. Not every developer thinks about their future, which is why this year we directly funded 401(k) contributions for everyone, even people who didn’t previously have a 401(k) account started. In those cases, we opened a new account in their name and put money in it.”
These benefits must be enticing for professionals in the gaming industry, because the ProbablyMonsters team has grown dramatically over the past few years. The company had around 150 employees a year ago, and now it sits at a headcount of over 230. The company is still actively hiring, aiming to hit 300 by the end of the year, and continue that headcount growth at a rate of 50 percent per year.
In addition to people benefits and hiring, the company plans to invest this funding in game development. All three of its studios are currently working on major projects. Firewalk is working with Sony Interactive and PlayStation to create an AAA multiplayer game. Cauldron is working on a single-player action game. And the third studio is working on a next-gen open world co-op RPG experience.
All of these games are currently in development, and have yet to be formally announced. This means ProbablyMonsters was able to raise its massive Series A without having a single game on shelves yet — a huge endorsement for the company.
“The scope of this raise, which is the largest Series A amount in our industry to date, reflects the confidence our investors have in our innovative platform for building game studios, creating original AAA IP and building the technologies that bring game developers and users together,” Ryan said. “We had excitement from institutional investors, but we have a relationship built on trust with our long-term investors who have supported our goals and see eye-to-eye with us on the importance of putting people first. Luther King Capital Management, who led this round, is an original investor, a long-time board member, and is culturally aligned to our vision.”
“The investment round is a great endorsement of what we’re doing to establish a new type of gaming company — one that’s people-first and structured around a hub and spoke model designed to allow focus on what teams do best,” he continued. “Our Monsters see the benefits of working with a company that really values creating sustainable and stable careers where they can focus on doing their best work without worrying about anything else. Developers can make games and the ProbablyMonsters team will take care of everything else.”