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Games - Saturday, April 29, 2006

Private Equity Firms Invests in Serious Gaming Startup

Minneapolis-based games developer Destineer has landed a new investment of $12M from private equity firm The Exxel Group, to be utilised for the development of unannounced PC and console titles.

Destineer was established in 2001by Peter Tampte - a former exec of the seminal serious games company Bungie Studios exec. The company was previously funded by IN-Q-Tel and has a different business model than most other game studios - it develops virtual training simulations for government, intelligence organisations and the military, such as First To Fight, which has been adopted by the US Marine Corps for training purposes.

Said the company's CEO Paul Rinde: "The venture capitalists of the video game industry have traditionally been the large publishers, because they’re the ones who have funded most game development until now. But, this new trend of private-equity firms investing in the games industry gives creative companies like Destineer much more flexibility to make games the established publishers are less likely to create."

Additional brands owned by the firm include a PC-based retail label for titles including the Unreal Engine game Red Orchestra, and MacSoft which develops Mac versions of popular PC titles including Halo and Zoo Tycoon 2.