Epic, maker of ‘Fortnite’, raises $1.25 billion

“Fortnite” has become one of the biggest video game sensations in the world. Now its maker, Epic Games, is cashing in.

On Friday, Epic said it had raised $1.25 billion from a group that included investment firms like KKR, plus aXiomatic, the owner of the esports company Team Liquid.

Behind the investment is the hope that “Fortnite” will remain a global phenomenon. Since it was released last year, teenagers and celebrities like Drake have hailed the game. It has made stars of prominent esports players like Tyler Blevins, who is known as Ninja. And its characters’ dances have been co-opted by professional athletes on baseball fields and World Cup pitches alike.

“Fortnite” features an online battle royale in which hundreds of players fight for survival. The game is free to play, but players pay to upgrade their characters’ outfits or dances. Analysts have estimated that “Fortnite” has generated hundreds of millions in sales for Epic, including nearly $300 million in in-game revenue in April alone.

The company’s last headline-making round was in 2012, when the Chinese internet giant Tencent bought a 40 percent stake at a roughly $825 million valuation. But that was before “Fortnite.”

It is unclear at what valuation the latest round was struck. Other investors included Iconiq Capital, Kleiner Perkins and Lightspeed Venture Partners. A spokeswoman for Epic declined to comment.

The investment comes with risks. Tops among them is how much longer “Fortnite” will remain a phenomenon. Its popularity on the video game streaming service Twitch appears to have peaked in July, at 151 million hours of streaming, according to the research firm SteamElements.

In a statement, Epic’s founder and chief executive, Tim Sweeney, suggested that his company’s appeal lay beyond “Fortnite.” “This reinforces Epic’s position of leadership in real-time 3D technology and accelerates our ability to improve the way people play, work and interact with the world,” he said.

© 2018 New York Times News Service