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Coda Payments has raised $ 690 million in funding to enable cross-border payments for games and other digital products as well as alternative app stores. While the funding amount is impressive, no money will go to the company as existing long-standing shareholders sell their shares to the new investors.
Smash Capital, Insight Partners and GIC invested funds to acquire a minority stake in the Singapore-based company as it expanded to more territories. Bloomberg reported that the company’s valuation was $ 2.5 billion. And while it is a secondary recapitalization, it shows that investors still have confidence in Coda Payments as it grows larger.
Apis Partners and all the company’s other existing shareholders will retain their equity positions in Coda in the future.
“We wanted to bring some new investors with expertise on board to help support the company in its next phase of growth,” said Neil Davidson, CEO and co-founder of Coda Payments, in an interview with GamesBeat. “We have had an interesting journey as a company. We achieved profitability relatively early in our history. And as a result, we have not really been on the cycle of new financing announcements every 18 months, where fresh investors have come in. ”
He added: “Given that our ambitions have increased so dramatically over the last few years, just as we have done, we really wanted to get some new investors on board who have experience in herding companies through the growth stage. And so that was what made us go out and find these new investors. ”
Codashop bills itself as a trusted source of in-game currencies and other premium content for millions of consumers in more than 50 territories worldwide. And it says it’s the only independent content marketplace with a global footprint.
Through Codashop, developers and publishers make it easier for their customers to access the content they love by allowing them to choose from more than 300 convenient payment methods. Coda also operates Codapay, which publishers use to accept the same range of payment methods available at Codashop on their own websites, and Codacash, a closed e-wallet that offers loyalty rewards to customers.
Codashop’s first market was Indonesia. Now it operates in about 50 markets, starting in Southeast Asia and expanding into places like South Asia, the Middle East, Latin America and since September Europe. Many of the markets in which it operates are emerging markets.
To make a purchase in Codashop, you must submit your player ID for a game. Then you select the face value of the virtual currency that you want to buy and then it is added instantly in the app. The store is connected directly to the game’s API, so delivery can take place instantly. Instead of taking 30% commission, as traditional app stores do, Codashop takes 15%.
You can pay for the purchase with any of 300 alternative payment systems, such as Venmo or the Cash app. Right now, on iOS, Codashop is not allowed to sell apps that are already in the App Store. But it can sell virtual currency that you can assign to your account in a number of app stores. And people like to do this to make it easier to pay with a local payment system on their phones or to access special marketing deals, Davidson said.
“Our focus historically, and at least in the short term, continues to take advantage of the opportunities available to us under the current environment,” Davidson said. “We focus on making money on the value chain, not app distribution.”
Alternative stores are getting more exciting for gaming companies thanks to a ruling by a federal judge in the antitrust case Epic Games vs. Apple. While Epic lost most of its claims (the case is under appeal), the judge ruled in favor of the Fortnite developer by saying that Apple could not ban developers in its iOS app store from promoting in-store offers. This, in turn, has increased the prospects for alternative app stores on mobile devices.
Publishers and developers partner with Coda to generate new revenue, reduce their revenue generation costs, and reach new paying audiences. Backed by a secure and reliable payment infrastructure and offering a hassle-free user experience, Codashop allows customers to choose from a wide range of popular payment methods and enjoy exclusive offers.
For publishers, Coda also acts as a trusted go-to-market partner, ensuring compliance with local rules and tax requirements, providing market insight, offering tailored marketing support and providing 24/7 customer care. The Coda vision is to be the preferred platform to take life’s digital experiences over the top.
While the Apple ruling drew attention to the possibility of alternative app stores, nothing has changed yet with Apple, as the order has been postponed until further lawsuits. Some regulators around the world are likely to run ahead of the U.S. antitrust court’s ruling in Epic Vs. The Apple case, and that can mean it can get complicated around the world to comply with the rules.
“Customers are very likely to find the payment method they prefer on the site. So it’s a great driver. Another is the user experience. So it turns out that for people for whom billing in the app works well, it’s a good option. “But for many Codashop shop customers, there are some things about the in-app billing user experience that are inconvenient, such as remembering your username and password associated with an email address.”
The company has more than 500 employees. Davidson said Codashop hopes to be able to help both publishers and new users with game discovery through its store, as the mobile gaming industry has gone extremely crazy. As gaming companies handle Apple’s push toward privacy over targeted ads, this kind of discovery will become more important.
“We have a really big opportunity here. It’s going to unfold over the next couple of years,” Davidson said. “And they would be part of that story. And I think the validation is coming from our track. “We have really grown incredibly fast in the last few years. I think it has given our new investors confidence that we have embarked on a real trend here.”
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