Prior to the third-round financing led by Accel Partners announced today, Booyah had previously received $9.5 million in venture backing, mainly from Kleiner Perkins Caufield & Byers' $100 million iFund and DAG Ventures. Both firms participated in the latest round.
The big dollars Booyah is attracting could help push competitors like Foursquare and Loopt more overtly into the social gaming arena, away from being mainly geo-location tools to discover where your friends are hanging out. With the ability to rack up check-ins to win rewards like becoming "mayor" of a particular place or real-world benefits, other social location apps certainly have gaming elements, but not to the same extent as Booyah does with MyTown.
Booyah appears more in the mold of a company like Zynga, the creator of wildly popular immersive social games on Facebook like FarmVille and Mafia Wars, which has reportedly been valued at around $4 billion.
With the fresh capital infusion, Booyah founder Keith Lee told Business Insider the company plans to go even further in the direction of entertainment rather than providing a social utility or city guide service like companies from Foursquare to Facebook to Google. That makes sense, since Lee and his founding team came from gaming company Blizzard Entertainment.
Mobile gaming overall is expected to enjoy steady growth in the coming years, with worldwide sales projected to rise 19% this year to $5.6 billion, hitting $11.4 billion by 2014, according to new data released today by Gartner. Growing adoption of tablet computers and other connected devices will add another dimension to the sector.
Leaning more aggressively toward entertainment and gaming carries its own risks, though, as these categories tend to be hit-driven businesses, unlike say, a city guide app. Underscoring the fickle nature of the industry, video game sales plunged 20% year-over-year in April, with declining sales of hardware, software and accessories, according to an NPD Group report last week. Few games of any kind stick around as long as the original Monopoly.
Even so, with companies like Booyah and Zynga landing whopping investment dollars and much bigger valuations, it's not hard to imagine other social location start-ups shifting more overtly into gaming to cash in. Who will end up the big winner in the social mobile free-for-all is another question.