12/20/2016 Updated News: it is being reported that Niantic has an Apple Watch app that is in development but delayed from its previously announced end of the year release date. The Apple Watch could be a perfect way for Pokemon Go players to play the game as it is such a mobile experience. There is also a rumor that Niantic is making its own wearable hardware product that will be announced early next year.
Before the smash success of Pokemon Go, Niantic was a small company that no one had heard of before. But suddenly there are investors scrambling to find out how to buy Niantic stock and they will be disappointed to find they can’t as it is not on any stock exchange because it is a private company.
Niantic was spun from Google (Alphabet) in 2015 and is a software development company that is responsible for the development of Pokemon Go. While everyone is trying to buy Nintendo stock, it only has a piece of the pie as the profits will be shared with the other investors responsible for making and backing the game. Nintendo, Google and The Pokemon Company have all invested in this new game up to $30 million and stand to be the major winners along with Niantic.
Will Niantic Ever IPO?
Whether Niantic will ever be big enough and important enough to have an IPO is something that is impossible to know as Pokemon Go is its first big hit and the company is still very small. Creating a second and third hit is something that is very hard to do and you can look at the Angry Birds franchise as evidence of that. So it may never be possible to buy Niantic stock and it certainly won’t be anytime soon.
Your best bet is to find other public companies that are in position to profit from the game and this new augmented reality phenomenon we are seeing today.
What Stocks Will Be Pokemon Go Winners?
You can buy Nintendo stock but it has shot through the roof and now looks expensive so that might not be a good choice. Besides, many of those investors that have bought NTDOY in the last week probably don’t understand that Nintendo is getting only a small percentage of the profits.
You can’t buy The Pokemon Company stock either because that company is private as well.
You can buy Google stock because they have a piece of the Pokemon pie as well as taking 30% from every in-app purchase made in the game. Right now with it’s popularity being so high, that 30% is likely millions of dollars a day. But Google is such a big company that something like Pokemon isn’t going to materially boost the bottom line.
Likewise, Apple also takes 30% from in-app Pokemon purchases and is making millions a day from the game. But just like Google, it is unlikely that “small” amount of money is going to excite shareholders at all and will not boost the stock price in any meaningful fashion.
So, the bottom line is unfortunately, you can’t buy Niantic stock or Pokemon stock and all the other players are too big or their stocks are already overvalued. Like anything in the stock market, jumping on the Nintendo bandwagon on day one was the best way to make money for those that were prescient enough to see how this Pokemon craze would play out.