Location-based gaming lands $325K funding round for Massive Damage

Massive Damage, the company behind Please Stay Calm, has secured $325,000 in an angel funding round that includes investors such as Boston’s Apricot Capital, Toronto’s Grassfed Capital, Ty Danco and Shopify’s Tobias Lütke. Please Stay Calm, the studio’s freshman project, is a locati0n-based iPhone game that uses real-world surroundings to set the scene for a zombie apocalypse.

So far, Please Stay Calm has only been available for Canadian players, but Massive Damage plans to launch in the U.S. beginning Oct. 13, 2011. That it has already been able to amass this kind of backing based only on a preliminary, small-market launch speaks to the potential inherent in the platform. Lütke, Shopify’s CEO, describes the game as “an extremely accessible, fun and engaging game that also sits perfectly at the intersection of location, social and mobile.”  He says, “Massive Damage has unlocked the key to location-based gaming.”

The Canadian pilot for Please Stay Calm has been successful so far; players have checked in at over 120,000 more locations and killed more than a million virtual zombies. Players also tend to be more engaged compared to the iPhone gaming industry average, enjoying five play sessions per day, twice as often as is usual for other games.

Of course, Massive Damage isn’t the only player on the location-based gaming board. Shadow Cities, a location-based iPhone (s aapl) game released by Helsinki-based Grey Area is making big waves. At our Mobilize 2011 conference, Grey Area CEO Ville Vesterinen discussed location-based gaming with our own Ryan Kim, and talked about how there’s still lots of opportunity to go further and do more in terms of integrating the real world with the game world.

Vesterinen also pointed out during his talk that lots of mobile gamers are actually doing most of their gaming at home, where a mobile platform isn’t actually a necessity. Massive Damage co-founder and CEO Ken Seto told me< his company took that into account when designing Please Stay Calm, which is why it’s easy for players to set up camp at their home or office locations and still participate fully.

Location-based gaming is an area where developers have just begun to scratch the surface in terms of what’s possible. This angel investment round for Massive Damage is a sign that investors are watching closely to see where this market goes next, and you can be sure we’re paying close attention, too.