Improbable sells gaming venture for $97m as analysts skeptical on commercialization

SoftBank-backed metaverse firm Improbable has sold one of its major gaming ventures to an Irish video game developer.

According to a CNBC report, Improbable sold its multiplayer games developer The Multiplayer Group (MPG) for $97.1 million to Keywords Studios, an Irish video game industry services company.

While this transaction aligns with Improbable’s broader venture builder strategy, analysts have raised concerns about the company’s ability to effectively commercialize its technology, citing perceived technical limitations and high associated costs.

In a commentary to CNBC, Greg Martin, co-founder and managing director of Rainmaker Securities, a private market trading firm, noted that Improbable’s business model remains uncertain, saying “the jury is still out if they have a viable business model going forward.”

However, Improbable’s CEO, Herman Narula, pointed out that the sale of The Multiplayer Group does not signify a retreat from the gaming sector. According to Narula, the deal was part of its “venture builder” strategy and the London-based firm is “not in any way selling any technology, or in any way ceasing to operate with games companies.”

“We’re not in any way selling any technology, or in any way ceasing to operate with games companies. MPG provide a very specific, specialized service.”

Herman Narula

In 2023 alone, Improbable organized 30 metaverse events, a significant increase from the previous years. The ambitious plan for 2024 aims to elevate this number to 300 events, as the firm is betting on creating a network of sovereign metaverses. Founded in 2012, Improbable was backed by a wide group of investors, including funding from venture capital firms and the Japanese multinational conglomerate SoftBank.

Meanwhile, European Union (EU) lawmakers are advocating for the EU to pioneer the development of virtual worlds, aiming to bolster EU businesses and reduce technological dependency on non-EU countries. This initiative, stemming from a vote by the European Parliament’s Committee on internal market and consumer protection, underlines a strategic shift towards embracing the metaverse as a significant component of Europe’s digital future.

The report from the committee particularly calls for a robust regulatory framework to support the development of virtual worlds. This move is partly in response to the observation that most companies involved in metaverse technologies are based outside the EU.