Microsoft (NASDAQ: MSFT)--the tech titan of Redmond--wants to expand and improve the quality of the company's services, and that includes its video game console series Xbox. In its various iterations, it has become one of the company's most profitable assets. As such, its corresponding services entail further innovation to buoy the product's prominent appeal. To that end, Microsoft has recently acquired a relatively unknown video-game streaming start-up by the name of Beam. The terms of the deal have not yet been released.
Beam was begun by Matt Salsamendi, an eighteen year-old Seattle native, just eight months ago. He started out with an idea that proposed a faster, more efficient, and advanced form of video-game live streaming. It closed the gap between viewers and players, transforming a passive experience into an active one via crowdsourced controls and clever algorithms. It eventually grew into a small but valuable company of twenty four employees before being bought by Microsoft. The size of the start-up though is no accurate measure of its value, as its founder explained just this year.
In May, Mr. Salsamendi took to the stage at TechCrunch Disrupt's Start-Up Battlefield, a competition amongst various tech start-ups for funding based on the feasibility and extent of their vision. He felt, quite confidently, that, "traditional platforms don't provide any way for viewers to participate." His company, he went on to explain, changed that completely: viewers and players can now interact within the game's mechanics, like a first person shooter (FPS) or real time strategy (RTS), with zero lag and zero delay. He won the prize of $50,000.
Next month, in June, he and his co-founder James Boehm, age 20, were named fellows of Peter Thiel's subsidiary organization, which pays young entrepreneurs an amount of $100,000 over a period of two years to develop their idea. The primary condition: no college. The surge in publicity certainly caught the attention of Microsoft, who pounced on Beam only one month later.
Microsoft has grabbed a viable and promising talent pool that will streamline their video-game services for future products. The hopeful effect is that it will further popularize the Xbox and its social platform Xbox Live amongst its target audiences, typically adolescents, which unsurprisingly still form the majority of the video-game market in the United States. The interactivity of the start-up is its most alluring concept. Microsoft, like many companies engaged in technology, is not alien to grappling talent and potential progress into its orbit--it has acquired numerous start-ups over the years for a variety of projects.
Mr. Salsamendi has also won in this deal. In addition to an expected amount of financial compensation, he will be in charge of his former team, now part of the engineering group working on the Xbox. He looks ahead to expanding his workforce with an even tighter focus.
In his blog, Mr. Salsamendi reflected on the amount of work it took him to bring his vision alive: "I vividly remember many of the hundreds of late nights that were spent. Hundreds of thousands of lines of code written. Millions of hours of streams during beta." He is, like many young and aspiring techies, a great dreamer and avid social media user. His hard work has paid off, literally. Perhaps this is yet another story to take inspiration from. It will be seen how he will fare working in the famed and sprawling HQ of Microsoft nestled amidst groves of Pacific trees.