Investment reports and market data
Documents
How to pitch your company to Angels or VCs – What we are looking for
The gaming industry represents a massive, high-growth global market that remains under-served by venture capital, particularly in Europe.
- Investors prioritize studios that control the entire value chain—development, live operations, and marketing—to build defensive moats and avoid reliance on third-party publishers.
- Successful gaming investments are defined by high cash efficiency, where achieving market fit allows studios to become self-sustaining and profitable while founders retain more equity.
- Investment decisions rely on a balance of quantitative metrics and qualitative team assessments, with investors acknowledging that KPIs like retention and lifetime value vary significantly by genre.
Sources of finance for indie games developers
Securing financing for independent game development requires a strategic understanding of the diverse capital landscape, which encompasses six primary categories: equity, project-based funding, grants, debt, accelerators, and crowdfunding.
- Independent game studios must align their choice of funding—equity, project-based, grants, debt, accelerators, or crowdfunding—with their specific development stage and long-term growth objectives.
- Equity financing is a primary route for high-growth startups, frequently utilizing UK government-backed tax incentives like the Seed Enterprise Investment Scheme (SEIS) and the Enterprise Investment Scheme (EIS).
- Project-based funding, such as publisher agreements, provides capital for specific titles without requiring developers to surrender equity in the parent company.
Navigating the funding jungle to finance your studio – Equity and project financing
Securing sustainable financing for game studios requires a strategic approach that prioritizes long-term alignment between creative vision and business objectives.
- Prioritize funding partners who provide industry-specific expertise, mentorship, and professional networks rather than treating capital as a mere commodity.
- Select a financing model—such as equity-based venture capital, project-specific funding, or publisher-led incubation—based on how it aligns with your studio’s long-term creative vision and need for operational independence.
- Initiate relationships with potential investors well before capital is required to build trust and avoid the unfavorable terms often associated with reactive, urgent deal-making.
New fundraising strategies for games developers
Securing capital for mobile game development requires a strategic approach tailored to the specific lifecycle stage of a studio.
- Studios should transition from equity-based funding to debt financing once a title achieves positive unit economics, where the lifetime value of a user exceeds the customer acquisition cost.
- Debt financing serves as a non-dilutive tool that allows developers to scale user acquisition by leveraging receivables from app stores and ad networks as security.
- Venture capital is often the most expensive and time-consuming funding path, requiring founders to surrender equity and commit to high-pressure exit strategies.
Panel: The strategics discussion
Strategic investment in the gaming industry is driven by a diverse set of corporate objectives, ranging from the acquisition of mature studios to the formation of publishing partnerships with early-stage teams.
- Equity investments are preferred over project financing because they better align long-term interests between founders and investors while avoiding the contractual friction associated with project-based funding.
- Strategic investment models vary across firms like Supercell, Wargaming, Nexon, Jagex, and FunPlus, ranging from acquiring mature studios to forming partnerships with early-stage teams based on specific operational gaps.
- Investors prioritize the retention of high-caliber leadership and creative autonomy, often favoring decentralized structures over rigid oversight models.
Fireside Chat: Growing your business through consolidation – The Stillfront Group story
Stillfront Group operates as a gaming conglomerate focused on acquiring and scaling independent game studios through a decentralized model.
- Stillfront Group utilizes a decentralized acquisition model to scale independent studios by providing centralized access to capital, cross-platform expertise, and a collective user base of approximately 500 million registered users.
- Investment decisions are governed by a strict performance marketing model that mandates all user acquisition spending must be recouped within a 180-day window.
- The group targets profitable, long-lived products and experienced management teams rather than distressed assets, focusing on a portfolio that currently exceeds 30 products.
Tencent Games Strategy 2019
Tencent’s strategic pivot in 2019 marks a recovery from the previous year’s regulatory freeze on game licenses, which had triggered the company’s first-ever profit decline.
- Tencent successfully recovered from a 2018 regulatory freeze by migrating 150 million monthly active users from PUBG Mobile to the compliant, self-developed title Peacekeeper Elite, resulting in $5.2 billion in quarterly gaming revenue.
- The company is mitigating domestic regulatory risks through aggressive international expansion, including the acquisition of Western studios like Sharkmob and licensing major IP such as Call of Duty and Street Fighter.
- Tencent is diversifying beyond mobile free-to-play models by growing its WeGame platform to 70 million monthly active users and securing an exclusive partnership to distribute the Nintendo Switch in China.
Serbian Gaming Industry Report 2018
The inaugural Serbian Games Association report maps a rapidly expanding national gaming ecosystem that now comprises more than 60 members across indie development, esports, visual-effects houses and internationally linked studios, employing over 1,500 skilled professionals.
- The Serbian gaming industry comprises over 60 member entities and employs more than 1,500 professionals, anchored by major players like Nordeus, Ubisoft Belgrade, and 3Lateral.
- Funding for the sector is diversified, with 40% sourced from angel investors, 30% from crowdfunding, and 20% from venture capital, with the largest single investment reaching €650,000.
- A robust pipeline of technical talent is supported by approximately 30,000 university students in IT-related programs and the integration of programming into primary-school curricula.
Sega Sammy Management Meeting
Sega Sammy is executing a multifaceted strategic transformation aimed at stabilizing its traditional gaming operations while aggressively pursuing global growth through digital distribution and casino expansion.
- Sega Sammy is consolidating its mobile and console development teams to maximize long-tail revenue through consistent content updates on platforms like Steam.
- The company is standardizing its hardware platforms under the ZEEG brand to improve operational efficiency across its gaming portfolio.
- Strategic expansion into the North American casino market is underway, supported by the successful acquisition of Nevada gaming licenses.
THQ Nordic AB Acquires Bugbear Entertainment: Investor Presentation
THQ Nordic AB expanded its global development footprint in November 2018 by acquiring a 90% stake in Helsinki-based Bugbear Entertainment, with an option to purchase the remaining 10% in the future.
- THQ Nordic acquired a 90% stake in Helsinki-based Bugbear Entertainment in November 2018, with an option to purchase the remaining 10%.
- The acquisition grants THQ Nordic full ownership of Bugbear’s intellectual property, specifically the Wreckfest and Stuntfest franchises.
- Wreckfest, which sold over 400,000 units on Steam following its June 2018 release, serves as the primary driver for the acquisition due to its strong commercial performance.
Speaking 'investor': How to communicate and interact with money managers
Equity analysts serve as critical intermediaries between game companies and institutional investors, such as pension funds and asset managers.
- Equity analysts bridge the gap between gaming studios and institutional investors by translating complex performance data into actionable financial models.
- The evaluation of a studio’s sustainability relies on three core pillars: the strength of the game portfolio, the efficacy of monetization and user acquisition strategies, and the studio's long-term growth trajectory.
- Transparency regarding key performance indicators—specifically monthly active users (MAU), average revenue per paying user (ARPPU), and UA spending efficiency—is essential to manage investor expectations and reduce stock price volatility.
Venture capital and other investments for Nordic games developers
The investment landscape for Nordic game developers is characterized by a strategic distinction between project-based funding and equity-based venture capital.
- Venture capital is a long-term partnership focused on building studio sustainability and operational stability, rather than simple project-based funding for individual titles.
- Investors typically target approximately 25 percent equity stakes in early rounds, intentionally avoiding majority control to ensure founders remain incentivized.
- The Nordic region maintains a consistent deal flow, with Sweden and Finland serving as primary hubs and the industry recording roughly 10 to 12 major exit or acquisition deals annually.