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Phoenix Labs: The Rebirth of Fun Gaming Experiences

Today we are happy to announce our lead investment in Phoenix Labs, an independent gaming studio focusing on the rebirth of fun gaming experiences. So far, Phoenix Labs has created Dauntless, an incredibly fun, co-operative action role playing game, and recently launched it into Closed Beta for PC. Phoenix Labs will mark our first gaming investment, but our journey toward making this investment was a long time coming and in many ways textbook for entering a new market. While the digital gaming space may have fallen a bit out of favor with VCs, we couldn’t ignore the fact that people are spending tremendous amounts of their valuable time and attention on digital gaming, creating opportunity for innovators who can delight them. In the next two years alone, the video game market for PC and consoles is expected to be $25B and $34B, respectively, which presents great opportunities for investors if they can find the right innovative teams and products to invest in.

We learned about Phoenix Labs’ early momentum through our friends at RIDGE, one of the most knowledgeable VCs in the gaming space, who were early investors in the company. We were again pointed toward Phoenix Labs in a market-mapping conversation with a friend who’s led corporate development efforts at a couple of large gaming enterprises. Then, we were directed to Sean Bender, a former VC friend who had left venture capital for operations within the gaming world, most notably at Riot Games where he worked on League of Legends, and more recently with the Phoenix Labs team. Basically, all roads were leading us toward Phoenix Labs.

So, we spoke to Sean, who not only helped us with broader market questions, but gave us the download on Phoenix Labs, which was sounding more and more interesting. A few months later we got to meet his co-founders — Jesse Houston (CEO) who puts the capital P in Passionate about design, and Robin Mayne who keeps the complex set of development trains running on time. It was really their set of previous experiences and working dynamic that set us sprinting after the opportunity. Their passion for creating compelling user experiences resonated with us all and the closed-alpha metrics related to signups and time-spent playing Dauntless are impressive, as are early industry impressions reviews of the Closed Alpha and Beta — plus, we had a great time playing ourselves.

Investing in gaming technology may seem out of character for us, but working with great teams creating innovative technology solutions in large markets will always be our focus at Sapphire. To us, it’s all about working with management teams that want to be global leaders in their chosen market and ultimately companies of consequence. The metrics we look for in a typical enterprise or consumer investment (market size/opportunity, team, product, business model, etc.) aren’t very different for a gaming company and the struggles a company faces around global expansion, customer retention and talent acquisition, to name a few, aren’t unique to any one industry. With our deep expertise helping companies grow and scale, we feel like we can help Phoenix Labs, and similar companies, turn these challenges into opportunities.

As expected, it’s already been fun working with this group of entrepreneurs and investors and we couldn’t be more excited for the Open Beta Launch of Dauntless this year!


Disclosures:  The information set forth herein is not intended to constitute investment advice and under no circumstances should any information provided herein be used or considered as an offer to sell or a solicitation of an offer to buy an interest in any investment fund managed by Sapphire Ventures. Sapphire Ventures does not solicit or make its services available to the public and none of the funds are currently open to new investors. Past performance is not indicative of future performance.

The portfolio companies referred to above do not necessarily represent all of the investments made or recommended by Sapphire Ventures, and were not selected based on the return on Sapphire Ventures’ investment in them. It should not be assumed that the specific investments identified and discussed herein were or will be profitable. Not all investments made by Sapphire Ventures will be profitable or will equal the performance of the companies identified above. View all of Sapphire Ventures’ investments here.