Rec Room, once recognized as a burgeoning leader in the social gaming sector, declared on Monday that it will terminate its platform on June 1. 

For those who cherish the platform or have enjoyed crafting or exploring its virtual landscapes, this announcement likely comes as a blow. Over time, Rec Room drew in over 150 million users, establishing itself as a prime destination for social gaming, particularly during the pandemic when many sought online connections. 

Established in 2016 by Nick Fajt and Cameron Brown, Rec Room gained notable interest and funding, achieving a valuation of $3.5 billion in December 2021. 

However, despite the vast player base, Rec Room faced challenges in finding a viable revenue model. Expenses soared, and the income couldn’t keep pace. Even with a robust community and innovative features like Maker AI for game development, the financial situation deteriorated, resulting in considerable layoffs earlier this year. 

“We invested a significant amount of time trying to make the numbers feasible,” the company stated in its announcement on Monday. “But with the recent changes in the VR market, alongside wider challenges in gaming, reaching profitability has become difficult enough that we’ve taken the hard step to close down.” 

Effective immediately, no new accounts or friend requests will be permitted. Creators will not be able to distribute monetized content, and the platform will cease operations at 12 p.m. PT on June 1.