Unity Software

Unity Software, also known as Unity Technologies, is an American video game technology provider. Originally founded in Denmark in 2004 as Over the Edge Entertainment, Unity thrived following the launch of the iPhone in 2007, as its proprietary game engine supported the platform. By 2020, Unity had produced many consecutive years of revenue growth, though the company remained unprofitable.

Unity’s flagship product, the Unity engine allows users to build and maintain all aspects of a game’s software, an increasingly complex task as a larger and larger portion of the market operates online, with chat features and complex cloud content requirements. Interestingly, Unity’s software is free for companies with revenue below $100,000, charging subscription-based fees once they grow beyond this stage. The software is considered easy-to-master for novice developers and counts multi-billion selling games such as PokemonGo and Call of Duty among its users. As well as providing the technical base for third-party developers’ software, Unity can promote their products through its distribution and marketing funnel.

In 2021, Unity announced its intention to focus on industries outside of their traditional base in the gaming sector, developing partnerships in the automotive industry and with consumer brands. Significant revenue growth, crossing the $1 billion annual threshold in 2021, has been countered by high costs.

Unity’s 2020 IPO was unique for a number of reasons, with the first ‘virtual bell-ringing’ in the history of the New York Stock Exchange. Taking place over Zoom, the ceremony was cut short by Wi-Fi failures on Unity’s end and had to be restarted. Unity also used an innovative method to set the starting share price, with investors bidding for price and number of shares on an online platform. Launching at $52 the shares closed on their first day at $68.88, giving the company a $13.6 billion valuation. Major institutional investors include Ark Investment Management and Vanguard.