3i co-invests in $23.5m round for Sulake Corporation
3i has chosen to invest further in this $23.5m funding round for Sulake Corporation along with Benchmark Capital and Elisa after a successful year for the company, with strong market demand and excellent future prospects for this innovative and unique business.
Sulake is an interactive entertainment company specialising in developing, publishing and distributing multiplayer online communities and games. Sulake''s top brand franchise, Habbo Hotel, is an online game environment designed for teens and has become one of the most popular and fastest growing teen websites in the world. To date, over 22 million Habbo characters have been created, with three million unique users visiting Habbo Hotel each month.
Sulake operates in various areas of the interactive entertainment industry; the fastest growing segment of the global entertainment and media market. Interactive entertainment is expected to grow from 25 to 55 billion USD between 2004 and 2008, averaging an impressive 20 percent compound annual growth.
"During this year we will focus in the further development of the Habbo Hotel concept and its launch in the promising Asian markets, particularly China and Korea," said Timo Soininen.
"Our strategic aim is to build Habbo into a new type of youth brand which is anchored in the largest online teen community. Habbo brand will also extend to include mobile games and content, animation series and merchandising products. We are also looking to broaden our product portfolio with other kinds of game and community concepts for new target audiences," adds Soininen.
Ere Kariola, Managing Director of 3i Finland, added: "As a long standing supporter of Sulake, 3i was attracted by Sulake''s pioneering fresh and innovative approach to building online social communities for teenagers and its highly effective revenue model. Progress to date is excellent and 3i sees great potential in further expanding the Habbo and other brands to new business areas and regions leveraging the full support of 3i''s international network of corporate contacts and decades of experience".
Jussi Nurmio, CEO of Taivas Group and co-Founder and Chairman of Sulake, "We are very pleased to have Benchmark as a new investor as I feel that their expertise and experience will help us in realizing our vision of building a new type of global teen brand."
Notes to editors
Sulake is an interactive entertainment company specializing in developing, publishing and distributing multiplayer online communities and games. Sulake reached $ 18 million in revenues 2004, which is more than twice than year 2003 and this growth is expected to continue during 2005.
The main shareholders in Sulake include Taivas Group, 3i Group plc, Elisa Group and Benchmark Capital followed by the company''s founders Sampo Karjalainen and Aapo Kyrölä, and Sulake CEO Timo Soininen. Sulake has localized Habbo Hotel communities in 16 countries on four continents: North America, Europe, Asia and Australia. To date, over 22 million Habbo characters have been created, with almost three million unique users visiting Habbo Hotel each month. The US version of the hotel, www.habbohotel.com, was launched in September 2004 and has already attracted users to create over 1.3 million Habbo characters. Sulake has headquarters in Finland and activities in 16 countries. Currently Sulake has over 160 employees worldwide.
3i is a world leader in private equity and venture capital. We focus on Buyouts, Growth Capital and Venture Capital and invest across Europe, in the United States and in Asia Pacific. Our competitive advantage comes from our international network and the strength and breadth of our relationships in business. These underpin the value that we deliver to our portfolio and to our shareholders.
In the 6 months to 30 September 2004, 3i invested €760 million, including co-investment funds. 3i''s venture capital business invested €108 million in the 6 months to 30 September 2004 in early stage technology companies. 3i''s Venture Capital business is focused on early stage technology investing in the Healthcare, Software, Communications and Electronics sectors.
About Benchmark Capital
Benchmark Capital was founded in 1995 to help talented entrepreneurs build great technology companies focused on long-term growth. Benchmark''s partners take an intensive, hands-on, team-oriented, approach to venture investing to deliver a superior level of service to the firm''s portfolio companies. Benchmark''s portfolio includes franchise companies such as Alphyra, the leading pan European electronic payments provider, Betfair, the world''s largest online betting company, eBay (Nasdaq: EBAY), Juniper Networks (Nasdaq: JNPR), MySQL, the leading open source database business, founded in Sweden, and Red Hat (Nasdaq: RHAT).
Managing more than $2.7 billion in committed venture capital, Benchmark focuses on investing in entrepreneurs with original ideas. Benchmark arrived in Europe in May 2000 since when it has made over 30 investments across a variety of market sectors and geographies. The $375m raised by Benchmark Europe II follows Benchmark''s first European fund of $500m.