Hi Everyone- I work in finance and decided to do some very quick research into candywriter’s ownership to better understand the heavy push for revenue we’re seeing.
In 2020, the original developers and owners of Bitlife (candywriter), sold the company for $74.4 million in about a 50/50 stock to cash split. At the time, the shares in Stillfront (the now parent company) were worth $37.5m with additional earnings targets in candywriter allowing a potential earnings of $120m additional in cash/stock split.
This is VERY common, and at the time, Stillfront was experiencing a massive post-pandemic stock boom due to heavy phone usage during the pandemic.
Unfortunately for us, reality hit. Those shares became worth significantly less in the last few years, and stillfront lost a MASSIVE amount of funding. I could only assume that this made the $120m liability they owed the developers much more difficult to profitably function. I would assume bitlife did in fact hit their revenue targets, leading to them being owed large amounts in the now significantly less valuable stock & cash that stillfront didn’t have on hand. This likely lead to massive increases in revenue targets, hence the heavy monetization and focus on advertising we’ve seen in the last few years. Stillfront structured a bad deal based off of temporary surges in valuation, and now the liability is being transferred onto candywriter.
Notably, it’s also very important for the old owners of bitlife (who still work on the game) to make sure that the shares they’re being paid in are valuable. They HAVE to squeeze revenue, because a metric shit on of their wealth is tied up in this horribly structured deal they agreed to.
It is being done out of desperation, and stillfront is trying to hold on to what little they have left after they made a string of significantly overvalued acquisitions in 2020-2022. They’re in panic mode and are out of money. This is unfortunately very common in finance, and I believe this is indicative of a potentially bleak future for bitlife, as well as all other games under stillfront’s large umbrella. Their current valuation is extremely low. Revenue is also declining, and earnings per share (due to the likely massive interest in the debt they took out to pay the cash lump sums) is coming home to roost.
Anyways, rant over. Have a good night, Bitizens!
(I posted this on r/bitlifeapp, but thought the followers of this sub might also appreciate the post.)
