Herman Narula, co-founder and CEO of Improbable, was a speaker at the Web Summit in Lisbon.
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The sale of one of its major gaming ventures from Improbable, a metaverse company, to London-listed video game developer Keywords Studios has been completed for £76.5 million ($97.1 million). The sale of The Multiplayer Group (MPG), a multiplayer game services firm, was finalized on Sunday, according to an Improbable spokesperson.
Keywords, headquartered in Ireland, operates more than 70 studios globally and has recently been acquiring other companies. The company has reported a decline in shares and an increase in debt as a result of these acquisitions. Despite this, the acquisition of MPG is expected to provide double-digit revenue growth for Keywords Studios starting in 2024.
MPG’s primary work includes providing services behind popular games such as Fallout 76 and Medal of Honor: Above and Beyond. According to Herman Narula, the CEO of Improbable, the deal is part of their “venture builder” strategy, in which they invest in or acquire gaming and metaverse-related teams, ultimately deciding to either grow or spin them off when the time is right.
The company’s acquisition of MPG has been seen as evidence of the dramatic growth of Improbable’s metaverse investments despite recent challenges in the firm’s operations.
Improbable, which was founded in 2012, is a British firm that aims to build a network of metaverses. At its core, Improbable has become heavily focused on its metaverse pursuits, marking a departure from its original focus on large-scale computer simulations with applications in gaming and defense. The company has also utilized its Morpheus technology to host large-scale multiplayer online games, as well as new virtual experiences developed in partnership with blockchain firm Yuga Labs.
The sale of MPG and Improbable’s shift towards artificial intelligence-enabled operations comes in the midst of cost reductions at the firm, drawing a stark contrast to the excitement around the metaverse and Web3-related startups. Last year, Improbable cut its losses significantly, leading the company to tout lower costs and pegging its future growth on its MSquared platform.
The company is hoping to see growth in the field of decentralized metaverses next year, positioning itself to offer a network of sovereign metaverses. However, analysts remain skeptical about the ability of Improbable to commercialize this technology, citing technical challenges and high costs as potential barriers to success.
