Mar 13, 2024 - News

PitchBook calls Epic Games a strong candidate for a 2024 IPO

INDIA - 2023/12/13: In this photo illustration, the Epic games logo is seen displayed on a mobile phone screen. (Photo Illustration by Idrees Abbas/SOPA Images/LightRocket via Getty Images)

Photo: Idrees Abbas/SOPA Images/LightRocket via Getty Images

Cary-based Epic Games has been a privately held company since it was founded by Tim Sweeney in 1991.

Yes, but: With billions of dollars in funding and high-profile partnerships with companies like Disney and Sony, the tech company has long been viewed as the region's best bet for a blockbuster initial public offering.

  • Taking Epic Games — most recently valued at $31.5 billion — public would provide a flood money to its investors and longtime employees, many of whom are based in the Triangle.

Driving the news: PitchBook, a data provider that tracks venture capital, named Epic as one of 20 venture-capital backed companies most likely to go public this year.

What they're saying: Epic declined to comment but pointed to an interview Sweeney gave to the Wall Street Journal in November.

  • Sweeney, the company's controlling shareholder, told the Journal he doesn't have current plans for an IPO but "could do that opportunistically at some point."

State of play: The case for Epic going public, according to PitchBook, is that the company's revenue is now diversified across video games, software (with subscriptions to its Unreal Engine) and uses of its tech outside the gaming industry, like in film.

  • Plus, its most recent Fortnite release, which included a partnership with Lego, as well as improvements to Unreal Engine, show "positive indicators for future revenue growth," PitchBook's Eric Bellomo wrote.
  • Yes, but: Epic's leadership team has long been noncommittal about a future IPO and its legal battles with Apple and Google and others could make its timeline more difficult, PitchBook noted.

By the numbers: PitchBook gives an IPO a 94% chance of being in Epic Games' future, noting its high valuation would make it quite expensive for another company to buy it.

  • PitchBook gives Epic a 1% chance of being bought and a 5% chance of remaining a private company long term.
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