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Mobile game studio Metacore has raised $179.9 million in credit from Supercell to continue developing its casual mobile game Merge Mansion.
It’s a huge amount of money to pour into a game studio with one game, but it shows what Helsinki-based Supercell is willing to do with the cash it generates from mobile gaming hits like Clash of Clans, Clash Royale, Hay Day, and Brawl Stars.
Since releasing its first game (Merge Mansion) in late 2020, Metacore’s annual revenue run rate has reached $54 million, putting the company on track to become one of the fastest-growing game studios in Europe. Merge Mansion is a puzzle game with more than 800,000 daily players. The new funding will help boost Merge Mansion’s global operations and strengthen Metacore’s core team.
“We’re off to a really good start and raised this follow-on funding from Supercell to increase the scaling of the game,” said Metacore CEO Mika Tammenkoski in an interview with GamesBeat. “It couldn’t be more exciting than this.”
Supercell has backed the game studio for years, with an initial investment of $5.9 million in 2018 followed by a $17.9 million investment and $11.9 million credit line in 2020. The new credit line financing strengthens Metacore’s capability to accelerate its growth while maintaining their current ownership structure and autonomy.
Supercell’s investments lead Jaakko Harlas said in a statement that Metacore is going from strength to strength. He said Merge Mansion launched with high expectations and has met them. He said Supercell invests in strong teams, and Supercell’s role is to remove obstacles.
“Merge Mansion has hit its metrics, and we have been scaling it successfully so far,” Tammenkoski said. “We believe that we can really reach the top of the charts with that game. As you know, as you know, getting to the top of the charts, or scaling mobile games, is really capital intensive because of the dynamics of the free-to-play business model. And it means that you have to invest heavily, and then you have to wait for a while to get the return on the investment.”
Metacore looks to fill key roles in game development and brand marketing.
“Most of the money goes into marketing,” he said. “The personal costs are really marginal compared to what you can spend on performance and brand marketing. And we really want to make Merge Mansion into an entertainment brand in the mobile game space. And that means that we really need to invest into it as well.”
Metacore has a distinctive approach to scaling its studio: It builds and tests games with small, two-to-three person teams that have full autonomy over games they develop and only expand these teams once they’ve validated the concept on the market through player feedback. That’s pretty similar to the way that Supercell runs.
Regarding Supercell, “They know how capital intensive scaling these games is,” Tammenkoski said. “We couldn’t have a better partner than this.”
This enables Metacore to quickly pivot or scrap game projects that players aren’t responding to, but it also means the studio can swiftly act when it’s clear they have a hit game like Merge Mansion on its hands.
Metacore has doubled its team size to close to 30 since last fall and is actively recruiting for key roles in game development, brand marketing, and other strategic business functions. Tammenkoski emphasized that the company is not rushing with recruitment and is taking the time to find the right fit.
Tammenkoski and Aki Järvilehto founded the company. Merge Mansion features a grandmother and her grandaughter who bond over an old mansion and try to get it back into livable shape. The advertising will focus on telling a story for a mass market audience, Tammenkoski said.
The funding comes at a time when mobile advertising is in flux, as Apple is prioritizing user privacy over targeting advertising. Tammenkoski said there is turbulence in the market and no one knows how bad it will get, but he said he is not targeting any particular cohort of players. That should make it easier to deal with Apple’s change in the Identifier for Advertisers (IDFA).
“The dynamics will change, but we will go broad with our advertising,” Tammenkoski said.
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