25 Sep — 1 Oct / 2023

Weekly News Digest #39


# of announced deals
announced deals’ size
# of closed deals

Supercell Acquires Ultimate Studio


Ultimate SupercellSupercell Acquires Ultimate Studio

Finland-based gaming company Supercell, a subsidiary of China-based gaming and tech giant Tencent (SEHK: 700), acquires a majority stake in Australia-based racing games developer Ultimate Studio. The partnership aims to create new titles and reach a broader global player base, marking it one of the first major steps for Supercell to expand beyond mobile.

Ultimate Studio was founded in 2018 and is primarily known for the arcade-style racing games series Hot Lap League, available on PC via Steam, as well as on AppStore and Google Play. Right off the bat, Supercell supported the company with a Seed investment and 3 following investments. To understand why Supercell went for the acquisition, let’s have a look at the performance of its games and the changes in strategy.

During the last 2 years, Supercell’s games slowly but steadily declined in terms of Revenue. The company currently runs 5 full-fledged games and 1 title in beta. Supercell’s three biggest titles — Clash of ClansClash Royale, and Brawl Stars — continue to show strong financial results, though the Revenue generated by all three games has declined almost twice for the last two years from approximately $110m per month in 2021 to ~$60m per month in 2023 so far, according to AppMagic.

Supercell Appmagic

Source: AppMagic

The current decline phase is highly associated with the strong decline in Brawl Stars Revenue. Apart from the overall market challenges, there are several reasons for this.

In Mar’22, Supercell removed its games from Russian and Belarus app stores, and blocked access at all from these countries one year later, losing a significant part of the market. According to, before all this Russia was top-1 in terms of downloads and top-2 in terms of Revenue. Apart from that, Supercell removed loot boxes from Brawl Stars in Dec’22, once again losing profits from in-game transactions. But this only accompanies the main reason for the decline — the lack of new launches.

Supercell Geo


Before that, the company managed to show tremendous growth within one platform by releasing one hit after another. Looking at the graph above we see that when Clash of Clans starts losing its Revenue, Clash Royale comes in and boosts the company’s performance. Then, the same thing happens with Brawl Stars. Looking at this hat-trick, we should not forget that before that the company was booming with Hay Day. Clearly, such a legacy builds high expectations both among the audience and the peers. As a result, we see Clash Mini staying over 1.5 years in soft launch (learn more on DoF), while Floodrush’s development is being canceled. Speaking of expectation, the reason for that is “the need to uphold the company’s standards of excellence”.

Combine the audience pressure with the tough conditions of the mobile gaming scene, and it gets easier to see the reason for Supercell to expand to other platforms. But this strategy doesn’t come out of the blue with the acquisition of Ultimate Studio. Back in Feb’23, the founder of Supercell Ilkka Paananen, stated that the company might look into the PC & Console gaming market while keeping operating existing mobile titles.

Supercell Univers

Source: Reddit

So what can we expect from Supercell coming to PC?

First, the company has experience working with Unreal Engine — the above-mentioned Clash Mini was built with Epic Games’ tech, unlike other games which are based on Supercell’s proprietary game engine. So Unreal Engine might be the stack for Supercell to use for the expansion. However, Supercell CEO Ilkka Paananen also spoke about the enhancement of the company’s game engine and “maybe even rivaling with third-party engines”.

Second, the company is likely to explore more of a casual side of PC & Console gaming. Ultimate Studio’s racing title Hot Lap League is an arcade game, which focuses more on the fun and chaos, rather than graphics and realism, that are common for simulation racing. This approach is close to that of Supercell, which makes easy-to-learn and hard-to-master games, appealing to a wider audience, but having a depth in gameplay and progression.

Third, the Supercell characters might come to PC & Console in both the same and the new games. Speaking of franchise expansion, the first thing coming to mind is porting Clash Royale or Brawl Stars to other platforms. However, Supercell’s IP has returning characters and its own unique universe, which can be used to expand into various types of new genres.

The acquisition of Ultimate Studio looks like a turning point for Supercell and the first sign of a new era for the company. However, the deep expertise in M&A and vast resources of Tencent might even help Supercell to transform into something entirely new that goes beyond our expectations.

We want to thank MGVC and Taylor Wessing for supporting this digest.

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UPDATE: Israel-based mobile games developer Playtika (NASDAQ: PLTK) has completed the acquisition of Israel-based mobile games developer Innplay Labs for a total amount of up to $300m, including an upfront consideration of $80m. Read the analysis of the deal in our previous digest.

US-based gaming payment solutions provider Xsolla has acquired an in-game server backend provider AcceleratXR. Founded in 2018, AcceleratXR offers multiplayer support for online games, apps, and extended reality titles. Xsolla aims to enhance developers’ cross-platform gaming experiences across PCs, consoles, and mobile devices, allowing consumers to maintain their purchase history between platforms. The acquisition signifies Xsolla’s strategic move to redefine cross-play technology, providing a comprehensive solution for game developers and publishers.


France-based mobile games developer Omada has raised $7.5m in a Seed funding round led by Felix Capital, with participation from 20VC, F4Motier Ventures, and Play Ventures. The sum will be used to further develop the company’s eponymous social casino app promoting responsible gaming. The app allows users to make in-game bets on real events without real money gambling, fostering friendly competition among gamers. With over one million monthly users, Omada aims to expand to the US, emphasizing a healthy alternative to sports betting.

US-based AI simulation company Luda has raised $7m in a funding round, led by BITKRAFT and Compound, with participation from other notable investors including Google’s chief scientist, Jeff Dean. The funds will be spent on supporting the company’s innovative AI training system Real-Time Reinforcement Learning. The system enables users to create AI agents without coding, allowing physics-based interactions. Luda’s platform, Mels, offers real-time browser-based simulation for users to craft AI agents, fostering a new creative medium for interactive and user-generated gameplay experiences.

US-based games developer and publisher CCG Labs has raised $2.5m in a funding round according to the SEC filings. The company is currently developing its first title DC Dual Force, a digital collectible card game based on DC Comics characters.

India-based newly-founded casual puzzle gaming studio QuriousBit has raised $2m in a Seed funding round led by Lumikai Fund, with participation from General Catalyst. Co-founded by former core team members of PlaySimple, QuriousBit plans to pioneer innovative puzzle games for global audiences. The funds will be used to assemble a team and create the company’s first game.

Poland-based newly-founded games developer Zakazane has raised $1m in a Pre-Seed funding round led by The Games Fund. The funding will kickstart the development of an immersive single-player Old West-themed role-playing game, exploring the complexities of justice. Zakazane, founded by veterans from CD Projekt Red (SE:CDR) and other Eastern European gaming companies, aims to create mature-themed, narrative-driven games and plans to launch its top-down isometric RPG on PC in the second half of 2026, with a focus on shaping morally ambiguous choices for players and offering full creative freedom in game development.


Finland-based mobile game developer and publisher Nitro Games (STO: NITRO) has received ~$0.46m (€0.43m) in the second installment of funding from Business Finland. The funding, provided in the form of a soft loan, aligns with Nitro Games’ strategy to enhance its game portfolio and expedite mobile game launches to the market. The company is primarily known for shooter games like Autogun Heroes and Heroes of Warland. Nitro Games plans to utilize the remaining approved funding of approximately $0.68m (€0.64m) until the project’s estimated duration of Jun’25.