Canadian private equity investment group Clarivest has led a $73.7 million round of investment in Hyderabad-based Head InfoTech India Private Limited, which runs Ace2Three, an online skill-based gaming platform. Clairvest’s portion of the investment will be around $4 million. Matrix Partners also invested in Ace2Three, an investment it made in 2010.
Michael Wagman, managing director of Clairvest Group will join the board of Head InfoTech following the deal, as indicated by this Economic Times report. Deepak Gullapalli CEO of Head InfoTech said Clairvest Group’s existing investments in the global gaming industry will be of strategic help in exploring other geographies.
Ace2Three is a gaming website which specializes in Indian Rummy and claims that it has eight million customers at the moment. It offers other variants of the rummy game, including 2-player and 6-player option games, tournaments, pool games, and more. In 2015, the Supreme Court of India declared online rummy, poker and card games as a game of skill and was not illegal in the country.
Ace2Three competes with gaming companies such as Octro, Adda52, Mango Games, Zynga, Miniclip and Zapak. Octro received Series A round of funding of $15 million from Sequoia Capital in June 2014. Note that Octro raised an undisclosed amount of funding from Matrix Partners India back in 2014 as well. Octro’s top-selling game Teen Patti is similar to online poker while Adda52 offers poker and rummy.
The Indian gaming industry is expected to touch $801 million by 2022 from $543.08 million in 2016 and is primarily being pushed by online card games, free to play games with in-app purchases and increased mobile penetration.