Vostu, The Zynga Of Brazil, Raises $30 Million At $300 Million Valuation
Social gaming is an international phenomenon. While Zynga is the leading social gaming company in the U.S., in Brazil it is a company called Vostu. The company has been growing rapidly and just closed a $30 million series C financing led by Tiger Management, with Accel Partners joining the round. Accel partner Jim Breyer, who sits on Facebook’s board, will take a board seat on Vostu. Previous investors Intel Capital and General Catalyst partners also participated. Investors purchased about 10 percent of the company in this latest round, giving Vostu a post-money valuation of roughly $300 million, according to a source with knowledge of the deal. Including previous rounds, Vostu now has raised a total of $46 million.
Vostu boasts 20 million active players a month, a tenfold increase from the beginning of the year. With only 40 percent Internet penetration in Brazil, that means that about a quarter of all Brazilians who are on the Internet play a Vostu game. Vostu currently has six social games (including a farm game, poker game, as well as soccer and crime role playing games) which are played on Brazil’s largest social network, Google-owned Orkut.
Almost all the revenues comes from virtual currency, which players spend inside the games. It is almost all micropayments, with a little advertising. Vostu coins can be bought via cash at convenience stores through prepaid scratch cards, or via SMS and charged directly to their cell phone bills.
The company was founded in 2007 by three Harvard classmates: CEO Daniel Kafie, chief scientist Mario Schlosser, and Joshua Kushner (who is also an active seed investor through Thrive Capital). The founders have said that Vostu is profitable. Vostu is managed from New York City, but employs more than 200 people in two game-creation studios in Buenos Aires and Sao Paolo.