17 ms·

This seems like an incredible over valuation for a company in video game technology.

by xigency 10y ago

erikpukinskis 10y ago
I think it's undervalued. Unity is the go-to platform for quickly building mobile and VR games. I wouldn't be surprised to see full percentage points of all computing time spent on the platform. A few percent of the world's consumer computer use is definitely worth 1.5b.
- dingo_bat 10y ago
  This is my feeling too. Unity is a $10b company if they maintain their tech lead and continue to be the go to engine for almost every mobile game.
jluk 10y ago
1. Why do you believe Unity to only be a video game tech? It obviously has applications reaching much further when you consider AR/VR use cases. 2. Minecraft was bought for $2.5B which is literally a video game. I think its a fair valuation given the current landscape for their domain.
- xigency 10y ago
  In this case, video game technology would be a super-set of other applications. Take any non-game usage and turn it into a game, for example. First, I think Minecraft was an over-valuation as well. Second, it's more of a personal affront. When I first saw Minecraft, I thought it was simple and something that anyone could make. I would rather see 15 unique block-building games made by amateurs gain success than one predictable commercial application. Obviously not the kind of success VC's want to see. Maybe this is because when I was the target demographic age (11-14) I was trying to make a Doom renderer. With the amount of time that your average kid plays Minecraft and with that amount of focus, you could easily instruct a child how to make Minecraft from scratch. When I first saw Unity, I thought it was similar to what I was trying to achieve programming. This was back when I was working on making cross-platform (homebrew) games that supported PC, Linux, and Sony PSP, plus doing some Wii development commercially and making WebGL games. When you're thinking competitively, every framework is an enemy. I have to agree that Unity has value, and perhaps this is a fair evaluation of their value, but when I first heard about Unity (2008?), it was unorganized and it didn't seem like the project organizers had the necessary know-how to actually build the project. One of those, I have a really great idea projects. Somehow, they've been able to make connections all over the industry and come a long way since then. I'm not exactly sure what nearly $200 million will do for them now. For the upstarter, the real capital needed in this field is about $50,000 for development kits for each platform and twice that for licenses to develop as well, and a $100,000 education plus about $1000 in library books and about as much time as Unity has been in existence, a decade or so. That's just for one person, but that would be quite a bit of work for one billion dollars. The point is, the product is worthless unless it's built by experts. The whole market of video game engines is upside-down, but that's another issue. Another reason to be upset is that lower entry barriers lead to lower quality commercial releases. Many top-selling games now have terrible performance and crippling bugs. But I'm not an investor.
adwf 10y ago
Undervalued if anything. Unity is almost ubiquitous in the indie games scene.
DINKDINK 10y ago
What do you think is reasonable? The video game industry market cap is around 17e9 USD2015[0]. Unity accounts for ~9% of the value. I'm not sure if it's an accurate valuation but it doesn't seem to be a ridiculous percentage given where they are in the production food chain. [0]http://www.statista.com/statistics/246892/value-of-the-video-game-market-in-the-us/ http://www.statista.com/statistics/246892/value-of-the-video...
- Keyframe 10y ago
  I didn't realise game engine is 100% of budget of a game? More like 1% (even on small scale). That would put their ideal sales around 15 million, pre tax and expenses per year. That's a long way from $1.5B valuation, even in most optimistic scenarios.
  - reitzensteinm 10y ago
    150 million.
    - Keyframe 10y ago
      9 percent of 17 billion is 1.53 billion of which 1% is 15.3 million. Unless people are spending 10% of their revenue on engine, which is absurd.
- kamilner 10y ago
  That seems odd, Electronic Arts alone has a market cap of ~23.5B: https://finance.yahoo.com/quote/EA/key-statistics?ltr=1 https://finance.yahoo.com/quote/EA/key-statistics?ltr=1
  - xigency 10y ago
    What's odd to me is that Epic Games is majority owned by Tim Sweeney, who has a < $1 billion net worth, and in serious and performance sensitive (VR) applications, UE4 is very difficult contention for Unity. Other than that, I've really lost track of the values of other game companies, other than knowing that EA and Ubisoft want to eat the sun.
hyperpallium 10y ago
It's a video game OS. 1. video games are bigger than movies. 2. MS made most of its profits from its OSs.
deelowe 10y ago
Might want to check how big video games are now as a business. They eclipse all other forms of media.
- xigency 10y ago
  Well, the business in the business is getting smaller, as it's still a terrible place to work. And the video game industry is always cannibalizing itself.
  - ehnto 10y ago
    That doesn't really change that it is a gigantic industry. The people are shoveling money at video games and the industry will be there to vacuum it up, whether the developers are happy or not. Arguably, Unity is just the kind of tool that will allow smaller, more ethical development shops to prosper in the games industry. We have already seen a huge array of wildly succesful games by small dev shops, that is a trend likely to continue. For interest sake, a recent popular space sim has reached 113 million dollars in crowd funding and it won't be released for at least a year or two more. People throw money at the mere possibility of a game, there is no shortage of cash flowing through the industry.
runamok 10y ago
You do realize video games make twice as much money as hollywood movies right? So clearly there should be money to be made in the industry selling tools. ref: https://www.quora.com/Who-makes-more-money-Hollywood-or-the-video-game-industry https://www.quora.com/Who-makes-more-money-Hollywood-or-the-...

This seems like an incredible over valuation for a company in video game technology.

by xigency 10y ago

This seems like an incredible over valuation for a company in video game technology.

I think it's undervalued. Unity is the go-to platform for quickly building mobile and VR games. I wouldn't be surprised to see full percentage points of all computing time spent on the platform. A few percent of the world's consumer computer use is definitely worth 1.5b.

dingo_bat 10y ago
This is my feeling too. Unity is a $10b company if they maintain their tech lead and continue to be the go to engine for almost every mobile game.

jluk 10y ago

1. Why do you believe Unity to only be a video game tech? It obviously has applications reaching much further when you consider AR/VR use cases. 2. Minecraft was bought for $2.5B which is literally a video game. I think its a fair valuation given the current landscape for their domain.

xigency 10y ago
In this case, video game technology would be a super-set of other applications. Take any non-game usage and turn it into a game, for example. First, I think Minecraft was an over-valuation as well. Second, it's more of a personal affront. When I first saw Minecraft, I thought it was simple and something that anyone could make. I would rather see 15 unique block-building games made by amateurs gain success than one predictable commercial application. Obviously not the kind of success VC's want to see. Maybe this is because when I was the target demographic age (11-14) I was trying to make a Doom renderer. With the amount of time that your average kid plays Minecraft and with that amount of focus, you could easily instruct a child how to make Minecraft from scratch. When I first saw Unity, I thought it was similar to what I was trying to achieve programming. This was back when I was working on making cross-platform (homebrew) games that supported PC, Linux, and Sony PSP, plus doing some Wii development commercially and making WebGL games. When you're thinking competitively, every framework is an enemy. I have to agree that Unity has value, and perhaps this is a fair evaluation of their value, but when I first heard about Unity (2008?), it was unorganized and it didn't seem like the project organizers had the necessary know-how to actually build the project. One of those, I have a really great idea projects. Somehow, they've been able to make connections all over the industry and come a long way since then. I'm not exactly sure what nearly $200 million will do for them now. For the upstarter, the real capital needed in this field is about $50,000 for development kits for each platform and twice that for licenses to develop as well, and a $100,000 education plus about $1000 in library books and about as much time as Unity has been in existence, a decade or so. That's just for one person, but that would be quite a bit of work for one billion dollars. The point is, the product is worthless unless it's built by experts. The whole market of video game engines is upside-down, but that's another issue. Another reason to be upset is that lower entry barriers lead to lower quality commercial releases. Many top-selling games now have terrible performance and crippling bugs. But I'm not an investor.

adwf 10y ago

Undervalued if anything. Unity is almost ubiquitous in the indie games scene.

DINKDINK 10y ago

What do you think is reasonable? The video game industry market cap is around 17e9 USD2015[0]. Unity accounts for ~9% of the value. I'm not sure if it's an accurate valuation but it doesn't seem to be a ridiculous percentage given where they are in the production food chain. [0]http://www.statista.com/statistics/246892/value-of-the-video-game-market-in-the-us/ http://www.statista.com/statistics/246892/value-of-the-video...

Keyframe 10y ago
I didn't realise game engine is 100% of budget of a game? More like 1% (even on small scale). That would put their ideal sales around 15 million, pre tax and expenses per year. That's a long way from $1.5B valuation, even in most optimistic scenarios.
- reitzensteinm 10y ago
  150 million.
  - Keyframe 10y ago
    9 percent of 17 billion is 1.53 billion of which 1% is 15.3 million. Unless people are spending 10% of their revenue on engine, which is absurd.
kamilner 10y ago
That seems odd, Electronic Arts alone has a market cap of ~23.5B: https://finance.yahoo.com/quote/EA/key-statistics?ltr=1 https://finance.yahoo.com/quote/EA/key-statistics?ltr=1
- xigency 10y ago
  What's odd to me is that Epic Games is majority owned by Tim Sweeney, who has a < $1 billion net worth, and in serious and performance sensitive (VR) applications, UE4 is very difficult contention for Unity. Other than that, I've really lost track of the values of other game companies, other than knowing that EA and Ubisoft want to eat the sun.

hyperpallium 10y ago

It's a video game OS. 1. video games are bigger than movies. 2. MS made most of its profits from its OSs.

deelowe 10y ago

Might want to check how big video games are now as a business. They eclipse all other forms of media.

xigency 10y ago
Well, the business in the business is getting smaller, as it's still a terrible place to work. And the video game industry is always cannibalizing itself.
- ehnto 10y ago
  That doesn't really change that it is a gigantic industry. The people are shoveling money at video games and the industry will be there to vacuum it up, whether the developers are happy or not. Arguably, Unity is just the kind of tool that will allow smaller, more ethical development shops to prosper in the games industry. We have already seen a huge array of wildly succesful games by small dev shops, that is a trend likely to continue. For interest sake, a recent popular space sim has reached 113 million dollars in crowd funding and it won't be released for at least a year or two more. People throw money at the mere possibility of a game, there is no shortage of cash flowing through the industry.

runamok 10y ago

You do realize video games make twice as much money as hollywood movies right? So clearly there should be money to be made in the industry selling tools. ref: https://www.quora.com/Who-makes-more-money-Hollywood-or-the-video-game-industry https://www.quora.com/Who-makes-more-money-Hollywood-or-the-...