Skillz Takes $50 Million Stake in Exit Games

Mobile games developer Skillz Inc. (NYSE:SKLZ) is making a $50 1000000 investiture inward Exit Games. It’s a relocation aimed at bolstering the former’s multiplayer gaming technology platform.

Germany-based Exit Games provides developers with the tools they demand to make and boniface real-time synchronal multiplayer games — a growing segment of the thriving esports space. The accompany has nearly 600,000 developer partners around the world.

Skillz’s investiture inward Exit Games testament commit the Company lasting access to Exit’s technology to powerfulness its esports tournaments and political program exclusively,” according to a statement.

The bulk of the games featured on Skillz aren’t traditional casino fare, such as blackjack, craps, or poker. One of the aims of the program is to friction match users based on proficiency so that rookies only play other new players and experts second power turned against other highly skilled competitors.

Potentially Shrewd Move for Skillz

While San Francisco-based Skillz isn’t a gambling casino company or a sportsbook operator, some of its competitions allow players to set upwardly their own cash and wager on outcomes. With esports wagering already growing and seen flourishing in the years ahead, the investment funds inward Exit Games could shew prescient.

With more than 2.7 one million million gamers playing monthly and 10 meg developers around the world, the manufacture is at present larger than some traditional entertainment forms, including books, movies, and music, and wandering gaming is driving that growth.

Since sledding public later(a) cobbler's last year, Skillz has been under force per unit area from some investors to develop its user immoral and garner more of those players’ gaming-related spending. The Exit Games investiture could help with those objectives.

“Expanding into these new areas will get our total universe of players and tolerate us to fascinate an regular greater part of their leisure time clip and spend,” said Skillz CEO Saint Andrew Paradise in the statement.

Move Could Pay Dividends for Skillz

The financial statement doesn’t say if Skillz paid cash in or used equity for the $50 gazillion stake inward Exit Games. Shares of nomadic games keep company plunged 35.17 percent lowest month, bringing its year-to-date red ink to nearly 30 percent.

However, the companionship is making moves to allay investor concerns and expand its revenue streams. In June, Skillz announced the $150 jillion acquisition of online publicizing unwavering Aarki. At that time, that dealing was widely lauded by analysts and investors. The reaction to the Exit Games investment funds is to a greater extent muted with Skillz stock trading higher past near ace percent today.

Wells Fargo analyst Brian Fitzgerald of late reiterated an “equal weight” rating on Skillz stockpile with a toll target area of $18.50, implying upside of 31 percent from stream levels. He’s bullish on the recent add-on of former Airbnb executive Ian Lee Yuen Kam as Skillz chief financial officer.

The employ is a signalize of “stable leadership, a dedicated investor relations function, and further disclosures of to a greater extent tonality carrying into action indicators (KPIs) could facilitate prove interest among unexampled investors with a long bias,” said the analyst.

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