Epic Games acquires kid-tech developer SuperAwesome

Epic Games, an American video game and software developer, announced Friday that it is acquiring SuperAwesome, a UK-based platform used to power kid-safe technology.

Why it matters: The deal speaks to the growing importance of children's safety and security on the internet.

• "It's a validation of the kid tech space, kid tech safety and parental involvement for developers everywhere," says Dylan Collins, CEO of SuperAwesome.

SuperAwesome's flagship product is its Kids Web Services (KWS) platform, a parental consent management toolkit that makes it easier for developers to implement kids' safety tools in their products.

Details: Epic is acquiring 100% of SuperAwesome, which will continue to operate as a standalone company. Deal terms are not being disclosed. The deal officially closes Wednesday.

• Epic will acquire all of SuperAwesome's employees across all of its offices in the U.K. and the U.S. SuperAwesome will continue to be headquartered in the U.K.
• SuperAwesome will continue to service its existing customers and agencies. It will also continue building out all of its products and projects with Epic's support.

The deal came to be after SuperAwesome and Epic began working together last year. "As we got closer and I got to understand Epic CEO Tim Sweeney's view on the world, I began to realize that our visions of how central kids and parents are to the future of the internet was something that we shared," Collins told Axios.

What's in it for Epic: "The deal helps Epic by virtue of helping our customers and our developer ecosystem," says Todd Rowe, global VP and GM of Epic. "If you're working with Epic, you'll have kid-safe products to offer the market."

• "For parents, it also gives them the peace of mind that if they are using Epic products, there will be a consistent level of quality in terms of kids safety."

What's in it for SuperAwesome: The deal will help SuperAwesome scale its product and services to more companies.

• SuperAwesome currently is used by more than 300 brands, powering safe digital engagement services for more than 500,000,000 kids every month, across thousands of apps, games and services.
• The goal is to make SuperAwesome's tech as widely available to as many developers as possible so that they can also be compliant with kids privacy and safety laws. Many of those developers already work with Epic.

Be smart: Rumors had circulated earlier this year that Microsoft might be interested in acquiring SuperAwesome. Microsoft's M12 Ventures led a $17 million fundraising round for SuperAwesome in January. Executives say this deal won't impact that relationship.

• "It's great to see SuperAwesome work closely with Microsoft," says Rowe. "Epic is a long-standing partner of Microsoft on the gaming side and with its cloud service Azure. What we hope is that with the acquisition, SuperAwesome will develop an even more important relationship with Microsoft. The question is, how can we take their relationship and expand it in many different areas?"

The big picture: Regulators around the world are focusing more on kids' privacy and safety on the internet. The U.S. has begun to issue more high-profile children's privacy fines to tech companies like YouTube and TikTok. The EU passed GDPR-K, a children's privacy law, in 2018.

• "Historically, a lot of the major tech companies have under-invested in kids' tech," says Collins. "I think that's been a bias almost every company has had."

What's next: The companies' product teams will begin working together post-acquisition to see how best to leverage SuperAwesome's tech with Epic's products and services.

Go deeper: SuperAwesome raises $17 million round led by Microsoft's M12 Ventures