Fortnite creator Epic Games has raised $2 billion in funding from Sony and the Lego family, in a massive deal highlighting the excitement from big businesses about the so-called “metaverse.”
Sony will inject $1 billion in the company, Epic announced Monday, while KIRKBI, the family-owned investment company behind Lego, will invest an equal amount. The deal, which is subject to customary closing conditions, would value Epic at $31.5 billion.
The news arrives hot on the heels of a partnership announced by Epic and Lego last week, aimed at co-developing a “family-friendly” metaverse for kids. Lego already has a successful line of video games based on lucrative franchises, including Disney’s Star Wars and Warner Bros’ Batman.
“A proportion of our investments is focused on trends we believe will impact the future world that we and our children will live in,” Soren Thorup Sorensen, CEO of KIRKBI, said in a statement Monday.
“This investment will accelerate our engagement in the world of digital play, and we are pleased to be investing in Epic Games to support their continued growth journey, with a long-term focus toward the future metaverse.”
Hype around the metaverse, a proposed network of vast virtual worlds, has taken the corporate world by storm lately. Facebook kicked off the trend by renaming itself Meta, and several big brands including JPMorgan, Samsung and Nike have begun experimenting with the technology.
However, companies like Epic and Roblox have long been talking about building a metaverse.
Epic’s battle-royale game Fortnite lets up to 100 players fight it out to be the last one standing. But it’s been branching out into other forms of entertainment, hosting music concerts from artists like Travis Scott and Marshmello, for example.
Roblox, meanwhile, wants to build a metaverse where millions of people can gather to play games or even work in a virtual economy fueled by Robux, its own in-app currency.
Epic Games CEO Tim Sweeney said the fresh funds would help the company “accelerate our work to build the metaverse.”
“As we reimagine the future of entertainment and play we need partners who share our vision. We have found this in our partnership with Sony and KIRKBI,” Sweeney said in a statement.
While it’s best known as the company behind Fortnite, Epic Games is a video game powerhouse. The company developed Unreal Engine, one of the biggest platforms used to create games, and operates its own online games store which competes with Microsoft and Valve.
The company has been at the center of a heated dispute between app developers and Apple over the latter’s App Store fees. Last year, a judge ruled that Apple can no longer prevent developers from directing users away from Apple’s own payment system. The tech giant typically takes a 15% to 30% cut from all in-app purchases.