Warwickshire's Mercia Asset Management provides update on gaming portfolio

Published by

Peter Davison

Julian Viggars

Warwickshire-based Mercia Asset Management has given backers an update on its investments in the growing mobile and digital gaming sector.

As at 30 September 2022, mobile and digital gaming investments accounted for around a third of Mercia's direct investment portfolio by value.

Mercia also invests in a number of gaming businesses through its managed funds.

Its investments include:

Farnborough-based nDreams, a virtual reality game developer and publisher which has established itself as one of the world's leading VR studios. It has grown its revenues by c.60 per cent in its financial year ended March 2023 and moved into profitable trading, with over $12million of projects signed so far in 2023.

Tunbridge Wells-based Virttrade Limited t/a Avid Games Limited a mobile trading card gaming company, and the creator of Cards, The Universe and Everything, which has c.250,000 monthly active users across 134 countries and gives Mercia exposure to the fast-growing mobile gaming market.

Invincibles Studio, formerly known as Soccer Manager, is one of the world's best-selling mobile football manager games.

The Preston and Leeds-based company recently raised a further £1.0million from Mercia's third-party funds and Mercia's own funds to continue to build on the success of its core Soccer Manager game franchise.

Most of the c.2,200 game development studios in the UK are SMEs, making them a natural fit for Mercia's investment criteria and sector expertise.

The UK has a strong commercial track record of producing innovative, fast growing and globally successful gaming studios.

The sector employs over 47,000 people directly and indirectly, while the UK's tax relief for video game development has helped attract significant investment in the sector.

The global gaming market was valued at $184.4billion in 2022 and is forecast to grow by five per cent per annum, reaching $211 billion and 3.6 billion players by 2025.

Julian Viggars, CIO of Mercia Asset Management PLC, said: "The UK's gaming sector has established itself as one of our most exciting sectors, experiencing strong growth supported by compelling and secular global tailwinds.

"The UK already has several leading studios distributing their games worldwide and we expect this number to grow. The continuing success of Mercia's investments validates our focus on this sector and ability to identify and nurture promising companies.

"While the mobile sector showed a small slowdown in 2022, I am particularly pleased that our two mobile games businesses are both showing outstanding growth through investment in the quality of their content, together with clear user acquisition strategies.

"We are also seeing significant momentum in the VR market with 2023 promising to be a pivotal year as new hardware is released by a number of leading global tech firms, including most recently Apple's augmented reality headset.

"Looking ahead, we will continue to seek out and support gaming companies that demonstrate exceptional potential for growth and value creation.

"With a keen focus on the regions, Mercia remains committed to fostering innovation, driving economic growth, and delivering strong returns for its investors."

Peter Davison

Peter Davison is deputy editor of The Business Magazine. He has spent his life in journalism – doing work experience in newsrooms in and around Bristol while still at school, and landing his first job on a local newspaper aged 19. By 28 he was the youngest newspaper editor in the country. An early advocate of online news, he spent the first years of the 2000s telling his bosses that the internet posed both the biggest opportunity and greatest threat to the newspaper industry and the art of journalism. He was right on both counts. Since 2006 he has enjoyed a career as a freelance journalist. He lives in rural Wiltshire with one wife, two children, and three cats.