SAN FRANCISCO (Reuters) - A group of video game and film industry executives said on Monday they have formed a new video game company with $400 million in backing from investors led by private equity firm ABRY Partners.
Brash Entertainment will focus on creating games based on film licenses, with one of its first titles linked to Lions Gate Entertainment Corp.’s “Saw” horror series.
Other games will be based on upcoming animated and action movies, the company said, without elaborating.
Brash is headed by Mitch Davis, who previously ran in-game advertising company Massive Inc., which Microsoft Corp. bought last year in a deal thought to have been worth at least $200 million.
“It still surprises some people to learn it is an industry bigger than Hollywood, and the growth rates ... we’re talking about double-digits on an ongoing basis,” Nicholas Longano, president of the new company, told Reuters.
Worldwide sales of gaming hardware and software hit almost $30 billion last year, and analysts say the industry is set for strong growth over the next few years amid increased purchases of new consoles from Microsoft, Sony Corp. and Nintendo Co. Ltd..
Other investors include New York Life Capital Partners III, Northwestern Mutual Life Insurance and PPM America Private Equity Fund II.
Previous attempts to break outside the established industry have struggled or failed, with one example being a venture founded by Seamus Blackley, one of the creators of Microsoft’s Xbox, that folded in 2004 without producing a single game.
Longano said Brash’s business model of outsourcing game development to independent studios with proven track records would set it apart.
“Once we’ve acquired a franchise, we go out to developers, interview teams that are interested, go through due diligence, look at their capabilities and whether they have experience or technology that is demonstrable,” Longano said.
By making sure game developers are passionate about a film, Brash should avoid the common industry pitfall of cranking out movie-based games that rely more on name recognition than game play to drive sales.
“What we think of is, how do we do the franchise the best service in terms of compelling game play that won’t let the fans down?” Longano said. “Our premise is definitely not to watch the movie and play it out in a game.”