SCVNGR’s new funding — a $4 million round led by Google Ventures with participation from Highland Capital, SCVNGR’s first backer — was nailed down by mid-October, but Google and Highland wanted to wait until January 12 to announce it “so they could control how the information gets disseminated,” according to SCVNGR founder and CEO Seth Priebatsch.
Those plans were blown when Priebatsch filed the company’s Form D to the SEC on December 24, Christmas Eve, when he thought no one would be working. “I figured no one would notice,” he said.
He claims to have saved some new information for a press release, though — details on the company’s ambitious plans for expansion. Priebatsch, now 21, dropped out of Princeton to found SCVNGR — his third company — about 18 months ago.
SCVNGR’s software enables people to go on scavenger hunts and play other games in the physical world with mobile phones. “There are $100 million market verticals we haven’t touched yet,” he told Venture Capital Journal back in October. (See my story on mobile gaming here). “We don’t have resources to introduce them, but third parties could build a business on top of the SCVNGR platform.
“For example, shopping malls — We have no ability to go after them, but SCVNGR drives traffic into stores and attracts back the 18-35 demographic. Somebody could make a ton of money. There are conferences, cities and tourism, museums, universities, team building and regional promotions. We are already international — in Canada — and we’ll be in Europe and Japan and Korea within the next four to six months.”
One use for the new money is to double the company’s size, from 20 to 40 employees. SCVNGR is looking for salespeople, engineers and “clue shredders” — non-technical, creative people who will move to different places and create games, doing the coolest things they can think of in order to push the limits of SCVNGR’s software.
Priebatsch said he talked to five prospective investors — including Highland and Google — and picked Google partly because of the company’s size and prominence and partly because of his admiration for Google’s Rich Miner, an expert on mobile with a sense of humor who’s joined SCVNGR’s board.
Humor is essential to fit in to SCVNGR’s work-hard, play-hard culture, which includes a corporate pool table and a monthly budget for Nerf guns. “(Miner) wasn’t taken aback when we showed up to a board meeting carrying the latest brand of Nerf weaponry,” Priebatsch said.
SCVNGR has now raised around $5 million, including Highland’s original investment, and is expected to exceed $1 million in revenue this year.