US-based online gaming platform developer Roblox has postponed plans for a public listing that could have given corporate investors Tencent and Warner Music Group (WMG) the chance to exit, according to Nasdaq.
The company filed in November 2020 to raise up to $1bn in an initial public offering reports earlier in the year suggested would involve it seeking an $8bn valuation, only to postpone it before the end of December due to uncertainty over that valuation.
Altimeter Capital and Dragoneer Investment Group co-led a $520m series H round for Roblox last month that included WMG and Investment Group of Santa Barbara, valuing it at $29.5bn. It was revealed alongside its plans to opt for a direct listing rather than an IPO.
Roblox runs an online platform with more than 31 million daily active users who can use it to create, share and play games with each other. A memo sent to employees last week cited by Nasdaq revealed it is putting the listing on hold due to scrutiny from the US Securities and Exchange Commission over how it recognises revenue.
The company’s IPO filing stated it had generated $589m in revenue during the first nine months of 2020, but the issue focuses on how it amortises the money it receives through players’ purchase of Robux, the currency used within its platform.
Roblox had secured $150m in a February 2020 series G round led by venture capital firm Andreessen Horowitz and backed by internet group Tencent, Temasek, Altos Ventures, Meritech Capital and Tiger Global Management at a $4bn valuation.
The series G round took the company’s total funding to about $550m and Tiger Global, Altos Ventures and Meritech participated as existing investors. Its earlier backers include First Round Capital, Greylock Partners and Index Ventures.
