It seems almost too good to be true, a trivia app that costs nothing to play but that gives out real money as prizes to players that win their various games and contests.
HQ Trivia has had a tumultuous life—and death—and then life again, but one thing that most players will ask at some point when they are answering their questions to get their share of the prize pool is: how exactly does HQ Trivia make money?
To understand HQ Trivia without looking into the history of the app is impossible. They released it first in August 2017 for iOS and then December 2017 for Android as a totally new concept. Players had online trivia competitions and other trivia apps for years, but suddenly the space was dominated by a free-to-play game—with a live host no less—where prize money was real instead of virtual.
Uptake was rapid. While the average number of users has sat in the 100,000 to 125,000 range, the app once hit a record high of 2.38 million users, on March 28, 2018. This meant that the company could offer greater prizes—pots sometimes reaching as much as $300,000, guest hosts the likes of Dwayne ‘The Rock’ Johnson, and partner deals with companies like Nike and Warner Bros. to cross-promote and add extra prize layers to the game.
At its peak, parent company Intermedia Labs was able to round up $15 million in venture-capital funding from Founders Fund, pushing Intermedia Labs post-money valuation into the $100 million range.
The app fell from this heyday as investors pulled out and securing further funding—or a direct takeover—proved impossible. After giving away over $6 million in cash prizes, the company made its 25 employees “redundant” on February 14, 2020.
The final show—hosted by presenters Matt Richards and Anna Roisman—had a jackpot of $5 (from Richards’ own pocket) and saw the two drinking and airing their feelings on the lack of investment and sponsorship deals that would have allowed the continuation of the show’s daily broadcasts.
Then, in late March 2020—seemingly from out of nowhere—HQ Trivia returned from the dead with a $1,000 show, complete with the same level of production values that it had been so famous for in its pomp. That it did so right at the beginning of the pandemic, with lockdowns and stay at home orders rampant around the globe, helped bring a little joy back into the lives of trivia buffs everywhere.
So, one question remains: Where did the money come from? How is HQ Trivia back up and running? Let’s look at the company today as a V2 model compared to the one that failed so spectacularly early last year.
The rebirth of HQ Trivia has been shrouded in secrecy. What we do know is that in late March the app popped back up on the back of investment from somewhere, though that investor seems to have been able to stay anonymous so far.
The timing was ideal—though for the wrong reasons—with people stuck at home. The app hit 120,000 concurrent players quickly, a 50% increase from the 80,000 it was seeing at its peak in the weeks before it was shut down.
The reboot isn’t entirely sitting on the money provided by investors, however. The relaunch of HQ Sports in May came with a partnership from Anheuser-Busch InBev support, one of several sponsorship projects and brand deals that the company hopes will make the app less reliant on investors and more able to cover their own costs as an independent platform.
As for those costs, what does HQ Trivia actually have to pay to keep the app up and running, anyway?
It is unclear how many of the 25 staffers let go came back with the company upon its relaunch. You would expect a slimmed-down staff to optimize revenue and cut costs. There will be some on that staff on the back end though—specifically developers and coders—keeping the app up and running. There will also be a marketing team, someone to write the questions, likely a money person or two, and—of course—the hosts of the game.
It is not a small undertaking to have an app like this out there. The level of production is what set HQ Trivia apart in the first place—plus that whole cash prize thing—and regressing in that way would turn longtime users away. That is why it is impressive that the app has been able to come back in such a successful way, trying to hit that peak point or self-sufficiency while also being a genre leader.
HQ Trivia also makes money in-app with a couple of products that players can buy with real world cash. The first is a VIP Prize Entry Ticket ($19.99 at the time of writing) which allows entry into a bigger jackpot competition against limited players.
The second is by buying coins (starting at $4.99 for 500 through to $64.99 for 15,000) that allow players to buy extra lives (to continue playing) or erasers (to eliminate one of the wrong answers as the quizzes are all multiple-choice format). These extra revenue streams have proven to be huge for apps and video games, and it is likely that HQ Trivia makes a tidy sum from their purchase each month.
HQ Trivia may survive this time—in its smaller and more sustainable form—or it may not. Either way, the app has certainly made its mark on the world, and in its brief spell at the top during V1 it was a legitimate powerhouse to be reckoned with in the world of not just trivia, but overall entertainment.