Strategic Design Network, a social game maker, has acquired social game payment services company Payout Hub for an undisclosed price.
Austin, Texas-based Strategic Design Network makes social games. Seth Goldberg, president of SDN, says the move will diversify his company’s revenue streams as the company prepares to launch its own games this year.
Payout Hub provides the infrastructure to pay cash prizes in skill-based online games. It was founded in mid-2009 by New York entrepreneurs Brad Hargreaves, Sean Mehra, and Jeffrey Reitman. It offers an applications programming interface, or API, to integrate cash tournaments into any skill-based game. It has worked with a number of game developers and casual game portals, including its acquirer. The Payout Hub founders say they’re happy with the deal and the strategic fit with SDN. The Payout Hub founders will work with SDN to make a smooth transition, but Hargreaves will join New York venture firm Tipping Point Partners as an entrepreneur in residence.
SDN was founded in 2009 to make social games. It has 11 employees and has raised $300,000 in angel funding to date. It is entering a crowded field with competitors such as Zynga, Serious Business, and LOL Apps. Payout Hub’s rivals include Worldwinner and King.com. Robert Goldberg is chief executive of SDN, which operates the portal site FreeGameToyz. So far, about two dozen clients use Payout Hub.
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