Monday, April 14, 2008

GuildCafe farms for $2M in VC gold

By Christopher Calnan

As it prepares for a significant marketing push that includes a company rebranding, online gaming network GuildCafe Entertainment Inc. has received $2 million of a planned $3 million Series A round of venture capital, according to federal documents.

The funding came nine months after the Cambridge company reportedly had received a $600,000 seed funding from venture capital firm IDG Ventures Boston, which is now known as Flybridge Capital Partners.

IDG Ventures had also been involved in a $23,770 financing GuildCafe completed in November 2007 to acquire Portland, Ore.-based Uberguilds, according to U.S. Securities and Exchange documents. GuildCafe CEO Jonathan Radoff said the $23,770 was just part of the total deal for Uberguilds, which also involved an amount of stock that he declined to reveal.

IDG Ventures is listed as GuildCafe's sole investor in an SEC document filed in March. Radoff declined to comment on the funding or on details of the company's rebranding strategy.

GuildCafe board member Jon Karlen, a general partner at Flybridge, declined to comment through a firm spokeswoman.

GuildCafe, founded in Southborough in 2006, operates a social networking website, primarily for players of massively multiplayer online role-playing games (MMORPGs). The network is designed to enable game players to find friends, discover game content and organize in-game activities.

Two weeks ago, the 12-employee GuildCafe moved its offices to Central Square in Cambridge, which is home to several other gaming companies, including Harmonix Music Systems Inc. and Motus Corp., a developer of motion game controllers.

Players of various online games typically team up via the web to form guilds, or social networks, that can grow to several hundred members. Networks such as GuildCafe serve as central portals for the guilds to share information, generating revenue through game advertisements and by charging fees for premium services.

Worldwide, about 16 million people subscribe for a fee to some MMORPGs and tens of millions play others for free, said Bruce Woodcock, a California-based MMORPG analyst.

GuildCafe was founded in 2006 as Sparkforge Entertainment Inc., according to state incorporation documents.

Uberguilds was founded in 2005 by John Findlay, who is now general manager of GuildCafe's alliance program.

In the early 1990s, Radoff, a Northborough native, founded NovaLink USA Corp., which developed the online game Legends of Future Past. In 1997, he founded Framingham-based software maker Eprise Corp., which was acquired in 2001 by Divine Inc. in a stock deal worth about $43 million.