Massively multiplayer online casino game Chumba World is recovering from a bad beat thanks to some new venture capital investors.
Australian startup Virtual Gaming Worlds (VGW) today announced it’s secured $2.5 million Australian (about $2.6 million USD) in a first round of venture funding one month after Kickstarter kicked its game off its crowdfunding website. At the time, VGW was seeking $50,000 to finish development and launch on Facebook. The funding shows that investors are still interested in placing bets on real-money gambling and social casino games.
Virtual Gaming Worlds CEO Laurence Escalante tells GamesBeat it will use the new money mostly for team and development expansion; for finishing off elements of the Chumba World platform, like the option to create user-generated content; and for marketing. It will also go toward a casino license, so players in countries that permit online gambling can build, promote, and make money off their own virtual casinos once the game goes live sometime in August.
Escalante doesn’t know why Kickstarter suspended his campaign; the website won’t comment on specific reasons for a project’s cancellation for legal and privacy reasons. He says he revised Chumba World’s pitch two to three times to remove any mention of “real-money play,” instead promoting the MMO’s social and player-generated content aspects. Still, it’s very likely that legal issues about gambling led to the project’s suspension.
Although real-money online gambling is now legal in places like Australia and the United Kingdom, it’s still illegal in most parts of the United States. In December 2011, the Justice Department made strides toward legalizing it when it reinterpreted a law to allow wagering in skill-based games like poker, but most states have been slow to pass their own legislation. Right now, online gambling is only legal in Nevada, New Jersey, and Delaware.
The inability to place real-money bets hasn’t stopped Americans from becoming the largest market for social casino gaming in the world. The U.S. accounts for approximately 40 percent of global revenues according to GamblingData’s Social Gaming White Paper 2012 report, and it’s mostly generated through sales of in-game currency that allows players to participate in tournaments or extend their gameplay.