Update: Over $237M Invested In 8 Virtual Goods Businesses In Q2 2009

By Alicia Ashby On July 13, 2009 · Leave a Comment

Today Engage Digital (formerly Virtual Worlds Management), the leading producer of trade events and media that focus on user engagement, announced through its blog VirtualGoodsNews.com findings from a comprehensive study of publicly disclosed transactions. These findings show that investors put approximately $237.2 million in eight companies that monetize at least in part through sales of virtual currency and goods in Q2 '09. Further information and discussion of the virtual goods business space will be held at Engage Digital's Virtual Goods Conference, to be held at the Engage! Expo in San Jose, September 23-24.

The original version of this story reported $37M invested in 6 virtual goods businesses in Q2 2009. After some discussion, however, the team at Engage Digital decided that $200 million investment made by Russian firm Digital Sky in the Facebook social network that occurred on May 26 should be added to the ongoing totals for the quarter. While Facebook does not monetize primarily or exclusively through virtual goods channels, its virtual gifts and branded virtual gifts initiatives do generate revenue for the company. An investment in the company Heyzap, valued at between $500,000 and $1 million, was also added to to the list as an undisclosed investment.

The $200 million invested in Facebook drastically skews the virtual goods space's performance this quarter. It is the single largest investment ever reported for a virtual goods business during the period where Engage Digital has reported figures, topping the $100 million invested in Chinese online game operator 9you in Q1 2008. Without the Facebook investment, this quarter's investment totals would be a historic low similar to the one being reported by our sister site Virtual Worlds News. With the Facebook investment, this is the business's single best quarter to date since Virtual Goods News began reporting figures.

Besides Digital Sky's giant bet on Facebook, the single largest investment of the quarter was $13 million for Boku, a mobile payments start-up that purchased Paymo and Mobillcash. Competing mobile pay service OneTXT also received a $2 million round. This is extraordinary given that there was no publicly disclosed investment in the mobile payments space at all in 2008 or Q1 2009. This may mean that mobile pay will be a space to watch throughout Q3 and Q4.

You can find the full list of companies and investments here.