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Stock sale puts Mind Candy price at £125m

Moshi Monsters creator sees value rocket, but could US pricing bubble be spreading to Europe?

A sale of stock in London-based company Mind Candy, the developer of children's social IP Moshi Monsters, has seen the company revalued at £125 million ($200).

Moshi Monsters began as a website which allows children to design and care for a virtual pet, with social and gamified elements. However, that business has now spread to magazines and toys, seeing phenomenal success in both the UK and worldwide.

Investment firm Spark Ventures redistributed its share of Mind Candy stock to existing investors, plus one new party, the FT reports. Having held the shares for a number of years, Spark Ventures saw a massive return on its original investment.

"We think there is a long way to go for Mind Candy," said Spark ventures chairman Thomas Teichman. "But after six years, when you see a return of 1,400 per cent, it's not a bad idea to take some profit."

"Since we last valued it, the volume of business has boomed in licensing, subscriptions, selling the magazine in the shops. That is why the value has gone up. What's interesting is that it's come from digital - online to offline, that's unique."

The spate of high valuations for social and online gaming companies recently has lead many to believe that the sector has entered a bubble similar to the that caused by the early online landgrab or the first explosion in home computer gaming. However, Teichman believes that Mind Candy has earned every penny of the £125 million price tag.

"There is worry out there that things have gone too far in the States. This is a proper business with proper revenues and it's priced sensibly, on real metrics rather than dreamy forward numbers."

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Dan Pearson