AAA Big Deal: Zynga’s Oxford university spin-off buy

Big Deal: Zynga’s Oxford university spin-off buy

While NaturalMotion may not have the same brand presence in the minds of gamers as either Bungee or Rovio, it’s certainly well known to the games development community. Its intellectual property portfolio contains both animation engine Morphene and self-animating artificial intelligence engine Euphoria. Both packages have won acclaim from the gaming industry, with Euphoria being used by one of the most widely respected gaming companies in the world, Rockstar North. The Scotland-based games developer, itself tracing its roots back to a computer club at Dundee College, has used Euphoria in a number of its top-selling titles, including Grand Theft Auto IVRed Dead Redemption, and Max Payne 3.
 

Eventually, NaturalMotion decided to follow in the footsteps of firms like Rovio, and began developing its own games. In July 2012, the firm released CSR Racing for iOS. Receiving largely positive reviews, the game reached number one in App Store game charts in over 70 countries, and at one point was generating more than $12m in revenue a month. Its 2013 title, Clumsy Ninja, was revealed during Apple’s iPhone 5 keynote speech, and would also go on to receive a positive response from the gaming community. 

The company’s rise to the top as one of the UK’s most successful mobile companies led to it being acquired by gaming company Zynga last month for $527m. While Zynga’s games operate less like a traditional video game and more a massive social psychology experiment into sunk cost fallacy, the company has enjoyed worldwide success in the past with social network games such as Mafia Wars. In 2010, its flagship game Farmville had one in five users of Facebook hooked, around 84 million players, and created such an avalanche of messages for the other 80% that the social network had to change its messaging rules.

The change forced Zynga into mobile gaming, and it has since failed to replicate the success of Farmville. However, the acquisition will add CSR Racingand Clumsy Ninja to Zynga’s portfolio, bolstering its outlook in the mobile games sector. More crucially, however, is the intellectual property it has now inherited. The same technology which brought Grand Theft Auto IV to life will now be added to Zynga’s games, bringing with it a new dimension of graphical immersion.

The deal will also be to Oxford’s benefit. Throughout its 13-year history, NaturalMotion only held one venture round for an unspecified sum from early-stage venture investor Balderon Capital, leaving Oxford with a sizeable stake in the firm.

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