The big business of Minecraft

The small Swedish company behind the popular video game brought in $235 million in revenue last year.

By Aimee Picchi Feb 5, 2013 1:51PM

If you aren't addicted to it, then your kids or friends probably are. Minecraft, the Lego-like video game, is rapidly gaining fans of all ages.


The story behind the game might be even more compelling than defending your Minecraft home from creepers or zombie villagers. 


In Minecraft, players use building blocks -- made of stone, wood and other materials -- to construct landscapes and buildings. Players also have to find food and fight off monsters, including exploding baddies known as creepers. 

The game is run by a small, closely held Swedish firm called Mojang AB, which has just 29 employees, according to The Wall Street Journal. With more than 20 million copies sold, the company last year brought in $235 million in revenue.


In other words, that means the company's per-employee revenue rate is $8.1 million. By comparison, Activision Blizzard (ATVI) -- the largest U.S. video-game publisher -- had per-employee revenue of $651,000 in 2011, based on data published in its annual report. Activision hasn't yet reported its 2012 earnings. On average, the 10 top tech companies including Apple (AAPL) and Netflix (NFLX) posted a per-employee revenue rate of $593,000 for the first nine months of 2011, according to Mashable.com


Mojang isn't skimping on profits, either. The company earned about $90 million before interest, taxes, depreciation and amortization last year. Lucas Simes of Chicago dresses as a 'Creeper' from the video game Minecraft at the Chicago Comic & Entertainment Expo on March 20, 2011 (Paul Warner/WireImage/Getty Images)


Given Activision's price-to-earnings multiple of about 14, Mojang would be worth more than $1 billion if it were publicly traded, the Journal notes.


Unfortunately for investors, it doesn't appear that Mojang -- Swedish for "gadget" -- will go public anytime soon. It's also resisted offers and investments from venture capital firms and former Facebook president Sean Parker.


"An exit would be huge, but do we really need that money? In our case, we have the cash flow. We have more money than we need," Mojang co-founder Carl Manneh, 35, told Reuters.


Behind the game is co-founder and creator Markus Persson, 33,  who is now working on its next project, a space adventure called "Ten to the C."


As for Minecraft, Mojang's Manneh said he believes it could potentially outsell "The Sims" as the world's best-selling game for PCs and Macs. 


"It looks like we are going to outsell 'The Sims' in one or two years if things progress," he told Reuters. 


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