Gaming unicorn Dream11 has decided to shut down its corporate venture capital (CVC) arm, Dream Capital, according to sources.
Dream Capital has been rolled back into Dream Sports, the source added. The gaming giant will explore strategic opportunities via an in-house corporate development structure.
Launched in August 2021, the unicorn gaming start-up said it would deploy $250 million from its balance sheet to fund investments across the start-up ecosystem.
- Also read: Dream11 moves Bombay HC against GST notice
Recently, the company acquired Sixer, a platform that deals in fantasy cricket stocks.
The real money gaming sector has seen an upheaval in recent times after the government implemented a 28 per cent GST on online gaming. Dream 11 has received a pre-show-cause notice of ₹25,000 crore from the Directorate General of GST Intelligence (DGGI), making it one of the most significant cases of indirect taxation.
Post this, unicorn online gaming company Mobile Premier League (MPL) laid off 350 employees — nearly 50 per cent of its workforce, while Spartan Poker laid off 125 employees and Hike Rush Gaming Universe also reduced its workforce by 22 per cent.
Other firms — crypto gaming platform One World Nation and gaming start-up Quizy have temporarily shut their operations.
The online skill gaming sector with a $20 billion enterprise valuation, $2.5 billion in revenue, and $1 billion in annual taxes, is set to grow by 30 per cent CAGR to reach $5 billion in revenue by 2025, according to industry estimates.
India’s gaming industry attracted $575 million in investments between 2014 and 2020. However, in 2021 and Q1 of 2022 alone, $1.7 billion was invested in the online skill gaming sector.