Clash of Clans maker Supercell has increased its stake in Space Ape Games to 75% by investing another $37 million in the game studio.

London-based Space Ape Games is in an expansion mode and it makes titles like the mobile rhythm game Beatstar, as well as past titles like Rival Kingdoms and Transformers: Earth Wars. Supercell, which is majority owned by Tencent, invested $56.6 million in Space Ape Games in 2017 for a 62.6% stake.

“The reasoning is first and foremost the success of Beatstar game, as we spent years working on, learning and mastering a category of music games,” said John Earner, Space Ape Games CEO, in an interview wit GamesBeat. “We have had success in that category and promise that we can continue to improve in that category. Through the game, we’re working on extensions for the future. It’s really compelling to us and to Supercell.”

Now the studio is worth more and Supercell is also extending a $50 million line of credit to Space Ape Games, bringing its total debt and equity investment to $189 million. Space Ape will use the additional funds and credit to grow its team and scale marketing.

“The financing will really help us chase that success,” Earner said. “I do think the second thing behind that story is confidence and enthusiasm on what else we’re doing, how much we’ve grown over the last few years beyond the music category, and a couple other things we’re doing as well. So ultimately, it’s a success story message. They’re increasing their stake in our company to help us chase success.”

Since its worldwide release in August 2021, Space Ape Games’ Beatstar has reached No. 1 on the overall charts in 24 countries, the top 10 in 70, and has become the top-grossing music game globally. The popular rhythm title has been played by over 30 million people, surpassed $60 million in revenue and won Game of the Year at the 2022 Mobile Game Awards.

The music industry has taken notice and adopted Beatstar as a paramount platform for music discovery, said Earner. The Black Eyed Peas, Shakira and David Guetta chose to debut their song, Don’t You Worry, exclusively in Beatstar two days before its release on any other platform.

These day-and-date song drops typically result in 400,000 fans engaging with the pre-save links used to drive new releases, and song plays can equate to 25% to 40% of the streams on Spotify and YouTube in a song’s first week.

“The faith and respect that Supercell has shown us over the years has been awesome,” said Earner. “They have truly supported us in chasing our ambitions in a way that has allowed us to flourish, and this renewed investment will set the stage for a new era at Space Ape; in many ways we are still at the beginning of a greater journey.”

“We couldn’t be more impressed with Space Ape’s team, their culture and their ability to make innovative and incredibly fun games like Beatstar,” said Jaakko Harlas, investment lead at Supercell, in a statement.

Several Supercell team members were deeply involved in Beatstar’s development. The game integrates SupercellID so that players can share their scores and challenge their clanmates from within Beatstar. Beatstar also features remixes of theme songs from Supercell games, with more coming soon, along with events, tournaments and more music genres.

Space Ape is a mobile free-to-play game developer and publisher founded in 2012. The company has a team of 120 people working on multiple game projects. Space Ape’s games have generated more than 105 million downloads to date and earned more than $300 million in revenue to date.

A long road ahead

One of its new titles in the works is the mobile multiplayer action game Boom Beach: Frontlines.

Earner said the company has a few different games in the works at any given time, but the success of Beatstar has made the team focus more. To continue working on more projects, Space Ape Games needs to expand. It is hiring people.

The Beatstar game took about four years of work. The team had to reboot itself during the project to get the gameplay right. And the company had to figure out how to license music. The rebooted Beatstar took about 2.5 years to hit the market, finally debuting in August 2021.

Earner said he loved working under Supercell’s ownership. He said the collaboration works well and the support is plentiful.

“It’s the best partner,” he said.

During the past five years, Earner said he has the mobile game market become “incredibly mature” as well as “supremely lucrative.”

“It’s a massive global industry in terms of numbers of players and finances,” he said. “It’s hugely relevant, if not more, so. It’s also incredibly competitive. But the barrier to entry and the skill and craft required to make a great game the team size required to maintain it are hurdles have all gotten really high in the last five years. It’s quite daunting. And it’s incredibly rewarding.”

He said it has gotten harder for small companies to be successful, but it’s awesome that more than three billion people play games.

“I see nothing supplanting mobile as the mass market gaming device of choice for most human beings on the planet,” he said. “I’d love to see AR platforms come along as much as the next entrepreneur. But the reality is mobile is an incredibly easy way to get to billions of people.”

He said companies have to find ways to serve players who aren’t being served well enough. They will have to focus on community and better ways to market games.

I asked if the Apple privacy changes — which affected the Identifier for Advertisers (IDFA) — and whether that made the mobile game industry more fragile because it made it harder to acquire new users for games. That was why Earner believed it was important to integrate the SupercellID into the Beatstar game and enable the team to learn more about players.

“Beatstar is just an incredibly appealing mass-market title, and I think the larger and more mass your market is, the less targeted you need to be,” he said.

He said the team needs to expand and bring on more specialists. Beatstar has 30 people on it and it could probably grow. He said the company is not working on blockchain-related projects.