Blockchain gaming startup Improbable raises $150M to expand M², which aims to help virtual worlds connect, led by a16z and Vision Fund 2 at a $1B valuation
Hannah Miller / Bloomberg :
Context & Ripple Effects
Improbable has been recycling the same capital base into new theses: a16z seeded the London firm as a distributed-computing play in 2015, then SoftBank's $502M mega-round in 2017 made it one of the UK's most richly funded startups, and NetEase paid $50M in 2018 to take SpatialOS into China. The M² raise marks the pivot of that accumulated platform ambition toward blockchain-based virtual worlds.
a16z is running the same playbook it used four months earlier when it led Mythical Games' $150M round at a $1.25B valuation for playable-NFT game infrastructure — back the connective-tissue layer of blockchain gaming rather than any single title. The bet compounded: by October 2022, Improbable was reportedly closing a further £100M at a £3B-plus valuation.
First-order effects
- Improbable gets $150M at a $1B valuation specifically to build out M², shifting the company from selling its own simulation tech (SpatialOS) to positioning as the interoperability layer between other companies' virtual worlds.
- Vision Fund 2 and a16z both deepen their exposure to blockchain gaming infrastructure, with a16z now holding parallel positions in Improbable and Mythical Games.
Second-order effects
- Rival virtual-world platforms face pressure to expose interoperability hooks or be locked out of an M²-connected ecosystem, repeating the SpatialOS dynamic where Improbable tried to make itself the middleware every world builds on.
- SoftBank's continued lead-role investing sits awkwardly against its own portfolio math — Vision Fund 2 led or co-led the most rounds in 2021 before posting a $2.1B quarterly loss and marking the fund down 19% below the $49B invested — making each new mega-bet like this one a test of whether the strategy survives its own losses.
Third-order effects
- If the pattern holds, blockchain gaming consolidates around a small set of well-funded interoperability standards rather than per-game economies, with a16z and SoftBank effectively underwriting which protocol wins — a repeat of the concentration dynamics already visible across their portfolios.
- Valuation opacity becomes structural: Improbable's reported figures moved between dollar and pound denominations and between private marks across rounds, leaving investors pricing these platforms largely on narrative rather than comparable financials.
The trend: Venture capital is concentrating in blockchain-gaming infrastructure layers that compete to become the interoperability standard for virtual worlds, with a16z and SoftBank placing repeated, correlated bets on the same thesis.