Infinite Reality, a company that builds metaverse worlds for brands and creators, announced on Tuesday its plan to buy esports and influencer talent startup ReKTGlobal for $470 million in an all-stock deal.
The acquisition gives ReKTGlobal shareholders about a 19% stake in the combined company, which it said would be valued at around $2.5 billion.
The deal presents an opportunity for the two companies to build out metaverse spaces for fans of ReKT’s esports teams and influencers it manages in its talent division.
Content creators and other celebrities have helped drive user engagement in virtual worlds, with music artists like Lil Nas X and Travis Scott drawing large crowds for performances in video games like Roblox and Fortnite, for example.
The acquisition could also boost Infinite Reality’s pitch to investors this year as it looks to go public via a reverse merger with a smoke- and fire-alarm company called Universal Security Instruments. A reverse merger is when a private company goes public by buying a listed company. Sometimes, as in this instance, the two companies sell completely disparate products.
ReKTGlobal’s influencer roster and esports brands could help Infinite Reality connect the dots between social media and the more nascent business of building metaverses, as well.
«Ultimately we want to offer a well-rounded product where we’re reaching the audiences that are going to be the first adopters,» Infinite Reality CEO John Acunto told Insider. «What are kids doing today? They’re doing social media and gaming.»
With its purchase of ReKTGlobal, Infinite Reality is going deeper into the buzzy world of esports, which Insider Intelligence estimated will hit $1.8 billion in revenue in 2022.
ReKTGlobal owns the esports organizations Team Rogue and the London Royal Ravens. It also bought TikTok talent-management agency TalentX Entertainment last year. It purchased digital-media companies Greenlit Content and Fearless Media in 2019 and 2020, respectively, to bolster its ads business.
Infinite Reality designs video game-style spaces for fans and customers to engage with brands and influencers. It owns a visual production studio and a social-media ecommerce platform. The company said it’s focused on building separate metaverse environments for customers as opposed to becoming a centralized hub like Meta Platform’s Horizon Worlds.
As executives across industries grapple with how to get involved in the metaverse trend, Infinite Reality is trying to position itself to serve as their guide.
The company earns money by offering technical services via its APIs and software development kit (SDK). Acunto said he expects clients to use Infinite Reality’s ecommerce tech to sell either digital assets like NFTs (non-fungible tokens) or real-world items.
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