How to invest in gaming #2: Embracer Group

Sweden features an impressive line-up of successfull tech and gaming companies: Paradox Interactive, King (Candy Crush), SoundCloud, DICE, Mojang (Minecraft), Klarna, iZettle and Spotify to mention some. Then there is Embracer Group. This name only came to my attention half a year ago, but what an exiting company! Let’s dive right in.

Embracer Group (EMBRAC B – Sweden)

Stock price as of this writing: 255 SEK
Company valued at: 108 mrd SEK (13 billion dollars)


This is only a highlight of games. Their entire portfolio includes over 200 franchises.

THQ Nordic

  • Saints Row
  • Dead Island
  • Desperados
  • Darksiders
  • Destroy All Humans
  • Wreckfest
  • Kingdoms of Amalur
  • Titan Quest
  • Gothic
  • ELEX

Koch Media (Deepsilver and Ravenscourt)

  • Chivalry II
  • Wasteland 3
  • Iron harvest
  • Outward
  • Kingdom Come: Deliverance
  • Yakuza
  • Agents of Mayhem
  • Dead Island
  • Risen 3

Coffee Stain Studios

  • Valheim
  • Satisfactory
  • Deep Rock Galactic
  • Goat Simulator

Saber Interactive

  • World War Z
  • Mud Runner
  • Snow Runner
  • NBA2K

In addition to the mentioned IPs, Saber Interactive has also worked on a wide range of other games, like different versions of The Witcher 3, Crysis Remastered, Halo: The Master Chief Collection, Quake, and Vampyr.

Gearbox Entertainment

  • Borderlands
  • Homeworld
  • Duke Nukem
  • Borthers in Arms

Gearbox Entertainment has also worked on a number of other games you might have heard of, like Half-Life and Counter-Strike.

Deca Games

  • Realm Of The Mad God
  • Knights & Dragons
  • Modern War
  • Crime City
  • Kingdom Age


  • Killer Sudoku
  • Pixel Art
  • Jigsaw Puzzles
  • Blockudoku
  • Groovepad


Aspyr is first and foremost a developer specializing in porting games to different platforms. Most notably it has ported a good portion of the Sid Meier Civilization series to the mac.

Amplifier Game Invest

Amplifier does not develop games of their own, but functions (to my understanding) almost as an incubator for small game startups. They invest in small startups, and offers project management to their partners.

Strengths and opportunities

Vast portfolio of franchises
Just look at the list above. It’s not even conclusive. With over 200 franchises, 57 internal game development studios and 5 500 employees, Embracer Group dabbles in pretty much every genre on every platform. This brings diversity, flexibility, and also heavily increases the chances of creating best-selling games.

Just take Valheim, which just hit 3 million sales in less than three weeks! Satisfactory is another big hit from Coffee Stain Studios, with well over a million games sold.

Adding to their diversity, their studios does not just focus on their own IPs, but are trusted partners of other giant game developers. Just take a look at Aspyr, which has ported over 20 titles (including DLCs) from 2K, owned by Take-Two Interactive.

Speaking of Aspyr, while doing this research I stumbled over rumours of Aspyr working on the new title for Star Wars: Knights of The Old Republic. If that turns out to be true, wow.

Extreme focus on acquisitions and investment
Last autumn they announced in one single day that they had acquired no less than 13 companies. This february they did pretty much the same, dropping the news that they had acquired Aspyr, Easybrain and Gearbox Entertainment on the same day.

The level of ambition is astronomical, which can be of great benefit for their investors. In december, they signed a credit facility contract, increasing their liquid funds to more than 11.5 billion SEK (1.4 billion dollars).

Weaknesses and threats

With the huge amount of acquisitions comes huge amounts of responsibility. Embracer Group’s game studios are located all over the world, and leading 50+ companies with 5 500 people is no easy task.

On top of this there seems to be a big focus on experimenting with completely new games and franchises. While a great opportunity, it will also lead to a lot of projects bleeding money. Embracer Group takes a very different approach than for example Paradox Interactive, which focuses mainly on developing big franchise “platforms” and then bombarding it with DLCs for years and years.

Final thoughts

I believe Embracer Group is an extremely interesting company with a level of ambition that is admirable. I think that ambition will either lead to very big success or very big failure. I have taken a small bet on the first, making it the biggest single stock in my small portfolio.

Interesting articles


How to invest in gaming #1: Paradox Interactive

While researching investment opportunities within the gaming industry, I decided it would be fun to create a series of articles with my notes. This is the first article, and dives into one of my favorite gaming companies – Paradox Interactive.

Paradox Interactive (PDX – Sweden)

Stock price as of this writing: 239.80 SEK
Company valued at: 3 057 680 000 USD (25.8 mrd SEK)

This swedish game developer and publisher became my most lucrative investment last year, with a 114% ROI. Paradox are primarily focused on the grand strategy genre, where they are a big player with games like Europa Universalis, Stellaris, Cities: Skylines, Hearts of Iron, Crusader Kings, Age of Wonders and Magicka. They also acquired the popular title Prison Architect last year, and are a successfull publisher for a variety of great titles: Steel Division, Tyranny, Surviving the Aftermath, Empire of Sin and Pillars of Eternity to mention some.

Game Studios

Paradox currently owns several different development studios in addition to their original Paradox Development Studio and its siblings:

Harebrained Schemes: Battletech, Necropolis, Shadowrun series, Golem Arcana, Strikefleet Omega, Crimson: Steam Pirates

Iceflake Studios: Surviving the Aftermath, Ice Lakes, Race Arcade, Premium Pool Arena, Target Horizon, Pirates don’t run

Triumph Studios: Age Of Wonders

Playrion Game Studio: Airlines Manager

Strengths and opportunities

Replayability & DLCs
One of the biggest strengths of Paradox is their ability to deliver deep, complex games with hundreds or thousands of hours of replayability, and then churn out DLCs. One of their main titles, Europa Universalis IV, currently have 33 DLCs, costing about 290$ combined. That means that a loyal fan of the game may leave about 320$ for the entirety of the DLCs plus the base game. This would be the closest thing you can come to a subscription based model without actually being one.

Churning out regular DLCs also ensures the games feel fresh and updated, and makes sure that players stick around for several years.

It’s not unusual to see Steam reviews from players with thousands of hours on Paradox titles

One of Paradox’s strength is that they have a overall theme: Strategy games. While a lot of the biggest companies dabbles in pretty much every genre, Paradox focuses mainly on strategy games, particularly grand strategy. This gives them the ability to be focused both in development, acquisition and talent.

Mobile and consoles
Grand strategy games involves a lot of clicking and reading, working best on desktop. That said, there’s obviously a big potential if they manage to successfully enter these platforms. Titles like Stellaris has already been ported to Xbox, and the acquisition of mobile game developer Playrion seems to signal that they want to take this seriously in the future.

New games
Crusader Kings III was released this autumn, 8 years after the second installment in the series. Being a very similar series with the latest game released one year after Crusader Kings II, Europa Universalis V will probably not be too far away. Having hit the mark with Crusader Kings III (93% positive Steam reviews as of this writing and 1 million copies sold), it’s a promising foundation to build on for Paradox. Both Cities: Skylines (2015) and Stellaris (2016) will also eventually get a new addition.

In addition to having a bunch of great titles to upgrade regurarly, hopefully they’ll be able to conjure up some brand new stuff as well. The acquisition of Prison Architect is also interesting to expand upon, with different kinds of architect games being a logical expansion.

Another kind of game that would be very exciting to see would be some kind of a strategy MMO. Although the DLC model makes each title very lucrative, it does have a maximum limit for what a player is able to spend on each game, unlike MMOs or games that heavy utilizes micro transactions like FIFA or Counter Strike.

Board games
Paradox has also announced that they are going to develop several of their digital games into board games, which could be another nice revenue stream. Crusader Kings and Magicka Mayhem are first out.

Weaknesses & threats

Grand strategy games are certainly not for everyone. One of the downsides of deep and complex games is that they have a big and sometimes unforgiving learning curve. This may throw a lot of potential customers off, especially those new to the genre. I believe the probability of Paradox launching an insane worldwide bestseller like Counter Strike, PUBG or Fortnite is pretty low.

Perhaps not as crazy as the learning curve of EVE Online, but Paradox titles are not for the casual gamer.

Games as platforms
To sell 30+ DLCs for 300$ for a game, you need players who really, really enjoyes the game. While a lot of games can sell big on hype and call it a day, Paradox is in it for the long term. A big hit can become a very big hit, but a big miss may be a very big miss.

Mobile and console
While being an opportunity, focusing on mobile and console games may simply be a dead end, at least for most of Paradox’s titles. Grand strategy games are best played on desktop, period.