Immutable, King River Capital and Polygon Labs launch US$100m web3 gaming fund

Australian blockchain gaming infrastructure company Immutable is teaming up with one of its investors, King River Capital, as well as New York-based web3 gaming giant Polygon Labs, to launch the US$100 million ($153 million) Inevitable Games Fund (IGF) to identify high-growth opportunities for investors.

The fund’s investment process will be led by Sydney-based King River Capital in collaboration with Immutable and Polygon Labs providing key deal flow and web3 gaming expertise.

Commitments of US$30 million have already been secured, including from Alpha Wave Ventures and Merit Circle, as well several family offices such as CrunchFund co-founder Mike Arrington, Steve Kokinos of Sonic Boom Ventures, Immutable's co-founders James and Robbie Ferguson, and Polygon's co-founder Sandeep Nailwal.

According to crypto market intelligence provider Messari, Immutable and Polygon currently account for around 70 per cent of the world's blockchain gaming development, following a significant growth year for the entire industry.

Sydney-based Immutable also recently announced a partnership with French games publisher Ubisoft, well known for its hit title Assassin's Creed, to develop a mainstream web3 gaming experience. The deal signals the company's strength in the space two years on from its $273 million Series C raise in early 2022.

Immutable is known for one of the world's largest blockchain games Gods Unchained, while the Immutable X platform allows game developers to trade and earn assets in cryptocurrency Ethereum due it its non-fungible token (NFT) integration capabilities.

King River will manage the deployment of IGF capital across premier game studios, web3 infrastructure, and immersive gaming experiences that are considered to redefine the digital entertainment landscape, regardless of the platform. It describes the fund as "ecosystem-agnostic", having already identified a strong pipeline of investment opportunities with the warehousing of seven early-stage investments.

These investments include the Australian-developed Guild of Guardians, one of the most anticipated Immutable platform games this year having attracted more than one million pre-registrations ahead of release in the second quarter of 2024.

The fund is considering other Australian startups and asserts it will be doing so as part of its global remit.

"Spending on video games exceeds the global revenue from movies, streaming TV and the music industry, combined, and it is ripe for a huge technology shift," says King River Capital co-founder and managing partner Zeb Rice.

"Just as mobile gaming went from virtually zero in 2008 to 79 per cent of gamers playing mobile today, we believe a similar shift has only just begun to web3 technology.

"The fund provides investors with an opportunity to gain unique access to the best web3 gaming projects globally and is designed to benefit from this multi-hundred billion dollar shift in spending to this disruptive new technology."

In 2023, blockchain gaming rounds reached $1.7 billion, with a significant part of that flowing to the 270-plus blockchain games in development on Immutable.

"We are excited to be launching this pioneering fund in partnership with King River Capital and assisted by Polygon Labs," says Immutable co-founder and president Robbie Ferguson.

"Our combined expertise, global relationships, and industry reach ideally position the Fund to identify and invest in the best web3 gaming and gaming infrastructure opportunities globally."

In addition to co-leading the Series C round for Immutable, King River Capital has also invested in such companies as Relevance AI, Ofload, Mindset Health and Sendle, among others.