RockYou Pivots to Game Acquisitions with $10M Debt Financing
Once a dominant force in social gaming, RockYou has reinvented itself as an acquirer and monetizer of established web, social, and mobile games. The company recently secured $10 million in debt financing from FastPay, a specialty lender for digital media firms, to fuel its strategic shift.
The New RockYou Business Model
Under CEO Lisa Marino’s leadership, RockYou now targets games that are:
- Past their peak popularity but retain active audiences
- Under-monetized with untapped revenue potential
- From major publishers like Disney Interactive and 50 Cubes
The company employs a dual approach:
- Acquiring games outright (12 purchases to date including Words of Wonder and Gardens of Time)
- Partnering with publishers for advertising monetization
“We’re challenging the industry’s hit-driven mentality,” Marino explained. “Our focus is extending the lifecycle of existing games through sophisticated monetization strategies.”
Growth Metrics and Funding Strategy
RockYou reports impressive traction with its new model:
- 75 million active players across its portfolio
- 250% year-over-year revenue growth
- $3.3 million raised in a separate March funding round
The company has primarily used operational cash flow and FastPay debt for acquisitions. Marino hinted at potential future equity financing, stating: “Our funding path depends on the deal landscape we encounter.”
Why This Approach Works
RockYou’s strategy capitalizes on several industry trends:
- Lower acquisition costs for post-peak games
- Established player bases reduce customer acquisition costs
- Diversified revenue streams through:
- Video advertising
- Virtual goods sales
- Cross-promotion opportunities
This pivot marks a significant evolution for RockYou, which previously made headlines for layoffs during its transition from social gaming pioneer to its current niche-focused model.
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