Sometimes, it’s the second time that’s the charm. At least that’s the case for Unity Software CEO John Riccitiello, who Forbes estimates has become the video game industry’s newest billionaire thanks to the company’s soaring shares—just eight years after his high-profile departure from gaming giant Electronic Arts.
Riccitiello joined Unity, the San Francisco-based video game software-maker whose products were used to help create hits like Pokemon Go, Among Us and Overcooked, as CEO in 2014. The 63-year-old Riccitiello is now worth an estimated $1.4 billion, due in large part to the accelerating value of Unity stock, which has more than tripled since the company’s IPO in September 2020. Riccitiello has 3.5 million Unity shares. He also has options to purchase nearly 2.8 million more shares, plus he’s amassed an estimated $215 million (after tax) from past sales of Unity and EA stock.
Riccitiello’s fortune received a boost with the announcement last week of Unity’s biggest acquisition to date: the technology division of Weta Digital, the visual-effects studio cofounded by Lord of the Rings director Peter Jackson, for which Unity is paying $1.625 billion in cash and stock. Shares of Unity have risen 15% to $197.55 since news of the deal, which has also made a billionaire out of Jackson. Iceland-born David Helgason, who cofounded Unity in 2004 and stepped down as CEO in October 2014 to make room for Riccitiello, is also a billionaire, as is cofounder and chief technology officer Joachim “Joe” Ante of Germany.
Critical to understanding Riccitiello’s success at Unity are his origins at EA, one of the biggest gaming companies in the world. After graduating from the University of California, Berkeley in 1981, and spending nearly two decades at a range of consumer goods companies—including Clorox, PepsiCo and Sara Lee—the Pennsylvania native joined EA as president and chief operating officer in 1997.
Riccitiello led the company through a stretch of strong growth, marked by its experimentation with new console technologies and massively popular games like Madden and FIFA, before leaving in 2004 to launch his own venture—the private equity firm Elevation Partners, which he cofounded alongside tech investor Roger McNamee and rockstar Bono. Riccitiello led the video games division. (Elevation Partners is a former investor in Forbes Media LLC.)
When he returned to EA in 2007 as CEO, Riccitiello quickly acknowledged bubbling changes in the industry stemming from the advent of digital games. Despite numerous attempts to evolve into the mobile age, along with dramatic cost-cutting measures, EA stock didn’t recover from the plunge it took during the 2008 market crash. Shares fell almost two-thirds during Riccitiello’s six-year tenure atop EA, which ended with his resignation in March 2013.
In a letter to employees, Riccitiello claimed “100 percent” responsibility for the disappointing results in his final quarter, but argued EA had “never been in a better position as a company.” While his legacy was divided, experts (for the most part) seemed to agree. “I think Riccitiello’s only mistakes were his expensive acquisitions,” mused Wedbush Securities analyst Michael Pachter in 2013, “but even they yielded a solid mobile and social business and a couple of bonafide franchises.”
A year later, Riccitiello took the helm of Unity, whose cross-platform game engine had become popular with independent studios and was, according to the company, reaching over 600,000 developers each month. Since he’s been CEO, hits created with Unity software include viral phenomenon Pokemon Go; Unity also integrated its products into content created for Facebook-owned Oculus. Before it went public in September 2020, Unity had raised over $718 million, according to Crunchbase, with a valuation of $6 billion. That number more than doubled when Unity’s IPO raised $1.3 billion for the company, boosting its market value to $13.7 billion.
Though still reporting large losses—the company has never been profitable and lost $282 million in 2020 on revenues of $772 million—Unity has boasted strong sales growth and soaring share prices amid growing interest in mobile gaming and virtual reality. It beat Wall Street expectations and reported revenue of $286 million for the third quarter ending September 30, an increase of 43% from the same period in 2020. Unity claims on its website that its software was used to make 71% of the top 1,000 mobile games and 50% of games across mobile, PC and console in 2020.
Riccitiello has led an aggressive campaign to keep Unity at the forefront of innovation, as evidenced by its recent string of acquisitions, including the purchases of RestAR, a deep learning and computer vision company, and Pixyz, a 3D preparation and optimization software. He claims the acquisition of Weta Digital will help with Unity’s pursuit of building out a metaverse, referencing the buzzy and loosely defined term for a digital world where people can interact as avatars.
“What we want to try to do is have your average 14-year-old to be able to do what Peter did in creating Gollum and putting that character in the metaverse,” Riccitiello told The Wall Street Journal of the deal.
But Riccitiello’s time at Unity hasn’t been without its own troubles. In 2019, he was named in a lawsuit by the company’s former vice president of talent acquisition, Anne Evans, who claimed Riccitiello, along with other men in Unity’s management team, spoke openly about female employees in a sexual manner and pursued relationships with them. Evans also alleged Riccitiello propositioned her and two of her direct reports for sex.
Evans claimed she was ultimately fired as retaliation for reporting the sexual harassment allegations. Unity denied this and instead described her exit as the result of “serious misconduct” surfaced in a “third-party investigation.” The company also denied the claims against Riccitiello and other members of Unity management, saying it would “vigorously defend against the false allegations.” The case is still pending in California court.
SEC filings from Unity state that Riccitiello’s fiancé—identified by a Unity spokesperson as former Unity Software Chief People Officer Elizabeth Brown—owned about 1.4 million options last year but has been exercising and selling them regularly. She currently owns about 477,000 options worth about $93 million. Evans alleged in her lawsuit that Brown and Riccitiello had been engaged in a sexual relationship since 2016, when Brown was still an employee at the company (she left Unity in November 2019).
Riccitiello declined an interview request for this story.