Social-gaming startup Winzo Games reports Rs 120 crore operating profit in FY23

WinZO, an Indian vernacular skill gaming platform, reported an impressive revenue increase of 182% in the financial year 2023, reaching Rs 687 crore, up from Rs 242 crore in FY22.

The growth can be attributed to the platform's growing consumer adoption and the success of its micro-transaction model. Notably, The startup also moved from a loss of Rs 120 crore in FY22 to a profit before tax of Rs 120 crore in FY23.

Accounting shifts and tax impacts

The company's profit figure comes with a caveat due to a substantial loss of Rs 836 crore accounted for by the change in the treatment of Compulsorily Convertible Preference Shares (CCPS) following the transition from IGAAP to IndAS accounting standards.

Including this adjustment, the net result for FY23 is a loss of Rs 710 crore. Moreover, the introduction of a 28% goods and services tax (GST) regime on the real-money gaming sector from October 1, 2023, looms as a future challenge, potentially affecting profitability across the sector.

Growth drivers and strategic moves

Founded in 2018 by Paavan Nanda and Saumya Singh Rathore, WinZO's success is attributed to its unique micro-transaction-based monetization model and its ability to offer a diverse game portfolio across multiple languages.

The startup claims to have over 175 million registered users and facilitates more than four billion micro-transactions monthly. Furthermore, WinZO's community-led distribution strategy and expansion into the Brazilian market underscore its efforts to diversify operations and enhance its global footprint.

The platform also has a portfolio of over 100 games spanning various genres, including strategy, sports, casual, card, arcade, racing and action, and board games across 12 languages such as English, Hindi, Gujarati, Marathi, Bengali and Bhojpuri. 

Funding and investors 

According to CrunchBase, WinZO has raised over $110 million in funding from investors, including Griffin Gaming Partners, Courtside Ventures, Makers Fund, The Stuart Partners, and FinAdvantage. In January 2021, It raised $65 million in a Series C funding round led by Griffin Gaming Partners.