Germany-based telecommunications company Deutsche Telekom’s corporate venturing unit invested up to €2m ($2.6m) in Germany-based gaming company Flaregames on Wednesday.
The two companies have also signed a marketing agreement between Flaregames and Deutsche Telekom, where they will work together on marketing and promotion of mobile games.
The round follows a €6m fundraising last month led by Accel Partners. Flaregames was founded in 2011.
Thomas Grota, a senior investment manager at T-Venture, said: "The mobile gaming market is a fast growing opportunity for VCs (venture capital firms). After browser games and now social games everybody asumes this is the next big thing in gaming. However investing in gaming is always a gamble because there are so many companies who try but also so many companies who fail." He added this meant it was important pick the company with "the most convincing management".
He added: "Klaas Kersting (the chief executive of Flaregames) and his team is from our perspective the most obvious choice in the market. We knew of their experience and their success rate in the past and trust them to transform their experience from the browser games market into the mobile gaming market. Also we have seen their prototypes of the mobile games which will be released during the next weeks/months and got convinced by that part of the business, as well."
"Of course, Deutsche Telekom / T-Mobile is able to support a mobile gaming company such as Flaregames within our customer base, our technology experts and marketing power to get a head start within the mobile market," Grota added.
Christian Illek, director of marketing at Telekom Deutschland, said: "Flaregames impressed us with a clear vision for growth, a great product pipeline and, above all, a great and highly motivated team. The market for mobile games is experiencing sensational growth, and flaregames is well positioned and on its way to becoming a strong global player in this field."
Klaas Kersting, chief executive and founder of Flaregames, said: "We had just closed a round of financing and are actually comfortably financed, but were open to T-Venture’s approach, as we consider it a unique strategic opportunity. T-Venture’s position as a catalyst between ourselves and Deutsche Telekom opens up numerous opportunities for successful collaboration and access to the customer base of the leading European carrier."