Virtual Worlds, Real Profits

Sparter is a new entry in the real money trading industry that uses an eBay-like “peer-to-peer” approach for the buying and selling of game gold for World of Warcraft and other MMORPG online games. The company has received venture capital funding from Bessemer Venture Partners and its management includes executives with experience at THQ, Walt Disney, Expedia, Ariba and IGN. Sparter describes itself as “the world’s first company devoted to enabling global Gamer2Gamer trading of virtual currencies.”

Sparter has a reputation system for buyers and sellers (similar to feedback on eBay) and uses an escrow system to protect buyers and sellers and manage the transfer of goods. There is no charge to list virtual currency, but the company charges a 10 percent commission fee to sellers for every transaction. Now in beta, the Sparter marketpalce offers only currency for sale, and not game accounts or power-leveling services.

The company’s debut comes just two weeks after eBay discontinued sales of game gold, game accounts and other virtual assets. Sparter appears to represent a direct challenge to IGE and other existing market makers, offering gamers the ability to eliminate the exchanges who have dominated the marketplace for goods from World of Warcraft, Everquest, Ultima Online and other games..

“The current market for virtual currency is dominated by large companies that aggregate gold and charge significant mark-ups to gamers,” the company says on its web site. “Sparter allows gamers to trade with each other directly. Essentially, we connect gamers who need gold to gamers who have gold. We started Sparter because we thought gamers and the industry would benefit from a new approach, one founded on the principles of open, efficient, transparent and safe trade. While many companies exist to sell you currency, only Sparter gives you the option of buying direct from gamers and, if you want, making some money by selling to gamers.”

Sparter is also working with IGE, Brogame, MOGS.com and other exchanges, listing their inventory in the Sparter system (and presumably functioning as an affiliate so it gets a referral fee). Sparter believes its approach will result in cheaper prices than those found on major exchanges. “Sparter has built a marketplace where many sellers compete for your business” the FAQ notes. “By creating an open and transparent marketplace individual gamers are on equal footing to professional sellers thereby increasing price competition. Additionally, by connecting buyers directly to sellers, we are eliminating the middleman, making it possible to purchase currency at a cheaper price.”

Because Sparter uses an escrow system, holding the buyer’s funds until the seller makes delivery, pricing may be influenced by how quickly you need the money. Buyers can choose their delivery window, which will in turn influence the price. “Shorter delivery windows usually will be more expensive than longer delivery windows,” according to Sparter.