[klik99]

5 years ago I would have agreed, VCs invested in games, rather than studios and most games never get released, let alone be successful if they are released. Rovio is a good example of that time period. But so many games people have exited and formed their own VC studios, or hired people who get games, and the focus has switched to investing in teams which is way better.

So while it's true that "games don't need VC", yeah there is a huge market for smaller games, and what success means for 1-4 person team is vastly smaller than a big game, there is also a place for large VC funded teams. I think this article is really saying "games shouldn't be funded by VC" which I think is just wrong.

Just like any VC, you want the VC to understand your industry, which games is hugely misunderstood by people who haven't worked in games. The VC has to understand what's valuable, which is a team that ships and works well together, not a particular game idea. Alternatively invest in a technology that is being built for the game, which is the Tencent approach and either use buy the tech if it works out or sell it. Either way, don't invest in a particular game product. Failures don't mean the model doesn't work, and successes without it doesn't mean it's not needed. VC is one of many ways to get from point A to point B and if depends on the project - if you have an idea that needs rocket fuel and you're willing to take the risk that rocket fuel entails, then it can make a lot of sense. But it's def not the only way.

[krageon]

A VC is an extractor. From the point of view of someone who wants the thing they invest in and the people building that thing, they are a net negative. Literally the only situation in which they're even remotely desirable is if you can't eat at all. And then you accept them with the understanding that they're taking something away from you.

[Ekaros]

Wouldn't the traditional publisher model somewhat modified be reasonable solution? They have been around for decades and they know the industry, have the connections and so on. Just have to leverage it right way.

Real issue with VC money in games is that returns most of the time just aren't big enough. And picking the winners is very hard.

[klik99]

This is a good question.

Publishers typically invest later in a project to help finish get it over the finish line. They used to invest earlier but over the years started investing later and later - as game engines got better and better, teams could do more with less funding so they stopped doing as much.

IMO VC entering the picture was a reaction to less early funding from publishers - it's filling a need for larger more ambitious projects.

[spacemarine1]

I see equity funding as useful starting funding.

Publishers are great for finishing funding once you know what your game is.

[kyriefh]

>there is also a place for large VC funded teams

that's a good point. i was at a large dev for a while myself and a fair number of coworkers have gone on to start their own studios, taking VC money in the process. a second dinner or theorycraft does need deep pockets, and the teams themselves bring most of the execution expertise needed