Sparrow Interactive

Sparrow Interactive

Sparrow InterActive is creating a mobile game to disrupt a pay to win genre

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Security Type
Revenue Sharing
Categories
Entertainment
Min Investment
$100
Location
Columbus, NC
Offering Date
October 09, 2020
Expected Close Date
February 02, 2021
Target Raise
$50.00K-$105.00K
Deal Notes

Revenue Share Loan

20% of Revenues

3.0X Payback Multiple

EARLY BIRD: Investors in the first $55k will receive a 3.5x payback

Secured by assets of Sparrow Interactive

The company will pay investors 20% of revenues each quarter until 100% of your principal is returned plus 250% on top

Company Description

For the last decade, the payment models for mobile real time strategy games have evolved from "pay to play" to "free to play" and now "pay to win". Recently, the genre has taken the "pay to win" model to an extreme, and that has created a problem for players and an opportunity for us.

Early payment models for mobile games followed traditional boxed games. . . you paid for the software and then downloaded it. However, a new model quickly evolved in which players could download a crippled version of the game and "unlock" features if they enjoyed playing it. 

This lasted for a while, but players began to demand more and more features be available for free. Developers, caught between pleasing their players and trying to generate revenue, created the current model which is Free to Play, but Pay to Win. This satisfied the Free to Play players at first because they could access more content. It also satisfied the developers as they were able to generate strong revenue.  It only worked for a little while though. . .

Key Deal Facts

Revenue model that allows players to compete on a level playing field
Unique gameplay with a focus on creating an enjoyable player experience
Strong community of over 2,000 interested players that is growing by an average of 5% per week
Already generating revenue, which is extremely rare for Alpha software
Mobile gaming market is over $68B with >10% growth predicted over the next 10 years
Realtime strategy games have some of the highest retention and spending rates in the industry

Use of Proceeds

$50,000

  • 40.5% Programming
  • 20% Artwork, 12% Quality Assurance
  • 12% Project Management
  • 7.5% Wefunder intermediary fee
  • 5% Promotions/Marketing
  • 3% Audio/Visual FX

$105,000

  • 40.5% Programming
  • 15.2% Operating Capital
  • 10.3% Promotions/Marketing
  • 9.2% Quality Assurance
  • 9.2% Project Management
  • 7.5% Wefunder intermediary fee
  • 5.5% Artwork
  • 2.6% Sound Design

Deal Notes

Revenue Share Loan

20% of Revenues

3.0X Payback Multiple

EARLY BIRD: Investors in the first $55k will receive a 3.5x payback

Secured by assets of Sparrow Interactive

The company will pay investors 20% of revenues each quarter until 100% of your principal is returned plus 250% on top

Amount Raised : $20,300
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Security Description

Revenue Sharing is a form of lending that involves sharing revenue from the business with investors as return on their investment. It is often a fixed percentage of revenue and you are paid until you earn a total return on your investment.

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