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Re:Games don't need venture capitalism by kyriefh on Sunday January 21, 2024 @09:56PM (#39085620)
hiya, author here. Palworld is a wild, wild game (think pokemon meets ark:survival evolved, or simply pokemon with guns), and it follows a number of other super-successful indie games that got made with no VC funding. i myself work heavily within the VC ecosystem, so it got me thinking about how games and VC tie together. while the article is written in an opinionated manner, i don't mean to present it as fact - more some musings and steelmanning of why VCs aren't needed
Re:Games don't need venture capitalism by minimaxir on Sunday January 21, 2024 @11:36PM (#39086245)
Palworld is an extreme lightning in a bottle and is not a consistent model for game development success.

For every Baldur's Gate 3 and Among Us, there are thousands of games that never reach that level of popularity. It's a similar survivorship bias as typical VC.

Re:Games don't need venture capitalism by MichaelZuo on Monday January 22, 2024 @12:03AM (#39086430)
The world's game industry only needs, at most, about 12 'lightning in a bottle's like this per year, so it seems like a perfectly workable model for such a small number.

The existing game studio system can already handle all other established niches in practice.

Re:Games don't need venture capitalism by Ekaros on Monday January 22, 2024 @12:51AM (#39086743)
12 sounds a lot, but it is actually not that many. Considering Steam had 14516 games last year. So that would be less than 1 in thousand. And you will also have self funded and games from traditional publishers.
Re:Games don't need venture capitalism by TillE on Monday January 22, 2024 @01:12AM (#39086853)
I've seen a couple people refer to BG3 as if it's some out-of-the-blue success. Larian has a strong history of consistent success, and reached another level by licensing an extremely popular franchise.

Similarly, nearly every AAA franchise game will do very well. Maybe there are some ups and downs, but overall it's boringly predictable. I can absolutely guarantee that GTA6 will be one of the best-selling games of all time.

Among Us is an actual weird indie hit, yes.

Re:Games don't need venture capitalism by minimaxir on Monday January 22, 2024 @01:36AM (#39086960)
BG3 was an iteration into a niche genre (CRPGs) where previous iterations in that genre underperformed (Pillars of Eternity and Divinity: Original Sin). Everyone, including Larian, was surprised.
Re:Games don't need venture capitalism by Ekaros on Monday January 22, 2024 @01:51AM (#39087024)
Not really. Divinity Original Sins and Divinity Original Sins 2 both did well enough for studio like Larian. I think they expected the BG3 to do similar, maybe somewhat better.

Trajectory was there. BG3 is an iteration of those two games and earlier ones.

Re:Games don't need venture capitalism by gamblor956 on Monday January 22, 2024 @02:42AM (#39087279)
Pillars of Eternity sold well enough to save Obsidian from bankruptcy.

D:OS sold 500,000 copies in 3 months, making over $10,000,000 on a development budget of $4 million. Not AAA numbers, but Larian more than doubled their investment.

Re:Games don't need venture capitalism by noirscape on Monday January 22, 2024 @06:56AM (#39088521)
Disagree. CRPGs back then had been hitting a minor renessaince for a while, notably from Owlcat, and D&D in specific has been on a never ending gravy train of popularity thanks to podcasts like Critical Role (and in spite of WOTCs attempts to break that gravy train by making inane audience alienating decisions).

BG3 whilst undeniably a massive success was likely always going to perform very well for Larian. The suprise was mostly that it ended up being a GOTY title I think.

Re:Games don't need venture capitalism by PH95VuimJjqBqy on Monday January 22, 2024 @08:07AM (#39089083)
It's _Larian_.

They've always been good. very good. And you know they're committed for the right reasons because they re-did large parts of DOS2 for free based upon community response.

I can't think of another studio who has willingly done that for people who have already paid.

Go back and play the original divine divinity. It's very good.

BG3 being a masterclass in game development shocked no one who has followed Larian over the years.

Re:Games don't need venture capitalism by raincole on Sunday January 21, 2024 @11:45PM (#39086312)
Palworld's budget is 1 billion yen (6M dollars). If you're willing to invest $6M out of your or your family's pocket yes you don't need VC.

For most people $6M budget means VC.

Re:Games don't need venture capitalism by nottorp on Monday January 22, 2024 @07:16AM (#39088664)
Are they even indie or they had a publisher?
Re:Games don't need venture capitalism by larsiusprime on Sunday January 21, 2024 @11:31PM (#39086222)
Having worked in games for 10+ years, and having recently joined a more traditional VC-backed startup outside of games, I think you are 100% on the money.

The VC model doesn't make a lot of sense for games. So many outsiders come into games thinking they know what they're doing and they learn some hard (and expensive!) lessons fast. Thanks for writing this.

Re:Games don't need venture capitalism by monero-xmr on Sunday January 21, 2024 @11:38PM (#39086258)
Games are a hit making business, much more similar to movies than to product businesses. Sequels and spinoffs can reduce the risk by leveraging the existing IP and fan base, but it's still a hit making business.

Indie games are more like self-published novels or youtube creators - you are trying to find a core fan base who will support your artistic endeavors. Sometimes they crossover into mainstream, but 99.99% of the time it remains a niche. At best you can earn a liveble wage that grows over many years.

I have seen many VCs dabble in games and they learn their lesson quick. VR / AR / Metaverse attracted a lot of VC investment, all of which is now burned into nothing.

Re:Games don't need venture capitalism by LarsDu88 on Sunday January 21, 2024 @11:55PM (#39086377)
This is correct. The distribution of successful games just like movies, youtubers and onlyfans creators is extremely skewed towards a power law distribution.

Games are amazingly difficult to make. Much harder than building web services, but the product success rate is even lower and with much lower stickiness amongst users.

What most silicon valley backed successful VC funded companies fundamentally are, are attempts to get software based network monopolies. Things that users won't immediately abandon for the next new shiny thing down the road.

Re:Games don't need venture capitalism by kyriefh on Monday January 22, 2024 @02:29AM (#39087222)
thanks for reading and sharing your perspective! i'm arguing against my own interest here as VCs indirectly pay most of my income, but as you also observe the standard playbook doesn't quite seem to copy paste well
Re:Games don't need venture capitalism by candiddevmike on Sunday January 21, 2024 @11:50PM (#39086342)
Palworld may end up being the first "big" GenAI-based copyright infringement case if Nintendo/Gamefreak decide to pursue it.