We continue our review of 2024 together with top managers and experts from the games industry (and related fields). Up next is an interview with Nick Matsokin, executive director at MGVC.
What was 2024 like for MGVC? What achievements would you like to highlight?
2024 marked a period of transformation and new opportunities for MY.GAMES Venture Capital (MGVC). One of the key milestones was the launch of MGVC Publishing, through which we signed four publishing deals that are already delivering impressive results.
The publishing partnership model remains highly relevant in the market. It allows us to leverage the extensive expertise of the MGVC team and the robust infrastructure of MY.GAMES, enabling collaboration with a wide range of independent studios.
For instance, our partnership with Press Fire Games on the Battle Prime project, a title with over four years on the market and an established audience, has yielded remarkable results. Together, we increased the game’s monthly revenue nearly fourfold.
Battle Prime
In October, we celebrated the global launch of Fable Town by Reef Games. This Merge-3 game attracted over 500,000 players within its first two months, earning its first million dollars in revenue.
Fable Town
Additionally, our publishing collaboration with ReactGames Studio on Days After Survival led to a 30% growth in the active audience and significant improvements in the project’s financial performance.
Days After Survival
How has the venture market changed for those ready to invest in gaming businesses?
The gaming venture market appears to be stabilizing in 2024. According to InvestGame, the results from the first three quarters of 2024 show a slight decline compared to the same period in 2023, both in the number of deals and overall deal volume. However, this drop is less pronounced than the sharp corrections seen in 2022 after the post-pandemic boom.
A notable trend is the shift among gaming VCs from investing primarily in content (game studios) to focusing on game tech — services and solutions that help developers create and manage their projects more efficiently. Key areas of interest include direct-to-consumer (D2C) payment solutions, web-based games and infrastructure, Telegram apps, and, of course, advancements in AI.
In the realm of game development, VCs are prioritizing experienced teams working on premium PC and console projects. Conversely, there is a continued cautiousness towards mobile game studios, reflecting ongoing challenges in the sector. These include intense competition, a low success rate for new launches, difficulties in user acquisition marketing, and increasingly high expectations from players regarding game quality.
That said, the current market environment presents unique opportunities for risk-tolerant investors. They can capitalize on favorable valuations by backing the most capable and efficient teams in the industry.
Has anything changed for studios looking to raise funds?
In 2024, game investors have remained cautious. For studios, this translates into significant challenges in securing early-stage investment across all platforms. Investors are increasingly focused on verifying a game’s market potential before committing funds.
For example, PC game projects are often required to have a polished playable version and a strong number of wishlists on Steam. For mobile games, a soft-launch version demonstrating high retention rates and solid monetization metrics is essential.
Raising funds to reach these initial milestones is one of the most difficult stages for studios. Angel investments can be particularly valuable at this point, as the network and resources of investors play a crucial role in bridging the gap.
In the mobile games sector, challenges go beyond development funding — significant budgets are required for user acquisition and scaling. Given these hurdles, publishing partnerships have become an attractive solution. Publishers not only invest their own funds into scaling the game but also provide marketing expertise and resources to help studios succeed in a competitive market.
What investment trends do you expect to intensify or emerge in 2025?
The investment trends seen in 2024 are expected to continue and evolve in 2025. Key areas of focus will likely include game tech and AI services for development and operations, premium PC games, and web-based games along with their supporting infrastructure.
In addition, we anticipate a significant increase in investment in direct-to-consumer (D2C) solutions, particularly web shop services. The competition among D2C startups to secure revenue from mobile game studios is expected to intensify.
It’s possible that well-funded D2C startups, backed by large investment rounds, may begin offering advances to game studios as an incentive for integrating their web shop solutions. This could create new dynamics in the market — one to watch closely as the year unfolds.
What plans does the fund have for the coming year?
In the coming year, we plan to continue expanding MGVC Publishing and supporting our partner studios, where we have already invested as a strategic partner.
Our focus will be on further developing the four publishing projects we are currently working with. Each of these projects is a strong contender in its respective genre, and we will leverage our publishing expertise and infrastructure to drive their growth.
We are also open to forming new publishing partnerships. This includes games at the soft-launch stage that are ready for monetization testing, as well as projects already in release. For these, we aim to enhance their success through ROI-efficient marketing and our suite of publishing solutions to help them reach the next level.
MGVC Publishing combines an expert publishing and marketing team, extensive experience collaborating with external studios, and the robust resources of MY.GAMES. Together, these elements enable us to create powerful, win-win partnerships that drive growth and success for all parties involved.