In Search of the Next Farmville

You might hear many VCs say that investing in social games has hit its peak and the time is right to look elsewhere for ways to make money.

That’s not to say there won’t be more deals of games makers, particularly later-stage companies. The evidence is Kabam’s Series C round of financing in January, which brought the maker of “Kingdoms of Camelot” $30 million from Redpoint Ventures, Canaan Partners and Intel Capital.

“We had to turn multiple investors away,” says CEO Kevin Chou, underscoring the excitement that remains for social gaming.

But it is likely 2011 will see cash go in new directions and away from content creators. That’s what Mark Boslet, senior reporter for Venture Capital Journal, has to say in the March 2011 issue.

Mark reports that some investors are hoping to rollup their smaller companies into larger ones with the ability to cross promote games and reach out to mobile platforms. Others are hoping to scout out lucrative niches that Zynga hasn’t yet discovered, staying one step ahead of the goliath.

Mark also reports that farming is so last decade–game mechanics is where it’s at in 2011. For instance, Gabe Zichermann, chair of the Gamification Summit, estimates that more than $10 million in seed capital went into game mechanics, or so-called gamification, companies last year.

VCJ subscribers can read the story here.

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And if you want to chime in about investing in gaming, contact VCJ Editor-in-Charge Alastair Goldfisher at