'Candy Crush Saga' maker heads to IPO
King, the British tech company responsible for the title and such other popular games, has filed paperwork with US regulators for an initial public offering.
By Tim Parker
"Candy Crush Saga" fans, rejoice. Soon, you'll be able to own shares of the company behind the most addicting game on the planet.
King, the British tech company responsible for the title and such other popular games as "Pet Rescue Saga," has filed paperwork with U.S. regulators for an initial public offering.
The IPO is believed to value the company at around $5 billion, but, much like Twitter, King used a new U.S. Securities and Exchange Commission regulation that allows certain companies to file confidentially.
Fans of "Star Trek: The Next Generation" may remember the episode where an addictive game was introduced to the ship that eventually resulted in people walking around in some sort of zoned-out trance.
"Candy Crush Saga" feels a lot like that game. Go just about anywhere and you'll likely see somebody moving those little pieces of candy around in an attempt to move to the next level. It's so addicting that studies were done to find out why people love the game so much.
Regardless, the numbers are almost unbelievable. The game has 10 times more active monthly users than the second most-popular Facebook (FB) app, it's the top grossing mobile app on both the iOS and Android platforms, and it brings King an estimated $850,000 a day or $310 million annually.
Although there are no reliable estimates for "Pet Rescue Saga," it's one of the top 10 grossing games on Apple's (AAPL) app store.
But here's the 600-pound piece of candy in the room: "Farmville." Everybody loved Zynga's (ZNGA) game until something better came along. If "Candy Crush Saga" helped to kill "Farmville," what's in development that will one day defeat "Candy Crush Saga"? What is King doing to keep from becoming the next game company that takes investor's money, but turns out to be a one- or two-hit wonder?
In fairness, where "Farmville" was largely unable to get out from under the Facebook umbrella, "Candy Crush Saga" does quite well independent of the Facebook platform. King is all about mobile -- something with a lot more staying power than Facebook.
According to reports, King has about 400 employees and is now the largest social gaming company. When Zynga achieved that status, it employed nearly 3,000 people. King is doing a better job of recognizing that all of its success today means nothing for tomorrow and that spending conservatively is crucial to long-term viability.
Of course, in the gaming world, it’s all about finding the next big hit -- something that is far more an art than a science. Who would have thought that moving pieces of candy around a screen would become a viral hit? King will have to prove that it has a formula for identifying hit games and that "Candy Crush Saga" wasn't just luck.
Disclosure: At the time of this writing, Tim Parker had no position in the above mentioned securities.
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The solid report comes a month after the retailer closed all of its Canadian operations.
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