Most venture capitalists don’t fund game studios because VCs usually avoid fields where the market is already mature (that is, there is already lots of entrenched competition before you even begin), at least not with a traditional idea. You’d be hard pressed to get venture capitalists to finance a new Coke competitor unless the idea was super disruptive somehow because it costs a lot to try to compete and there’s a lot of established giants in the market already. VCs are usually looking to finance startups with disruptive ideas that can tap into a new market that has very little competition because that’s where the largest potential financial wins live.
This is why we saw a lot of VC money get funneled into crypto stuff (including NFT games). Games by themselves are well-known quantities, but crypto is potentially disruptive technology so it is worth it to some VCs to roll those dice at the ground floor in hopes of a much bigger payday. A VC is much more willing to fund a wifi-enabled smart toilet app than a video game, if only because there are a lot fewer companies building wifi-enabled smart toilets than video games. Wifi-enabled smart toilets might be risky, but they have a much larger potential upside than another indie game released to Steam if they take off and the one they backed becomes the industry leader.
VCs aren’t monolithic. Some VCs leaned into crypto while others thought it was a scam, but the general rule is that VCs usually stay away from traditional ideas, especially in a crowded market. A smart toilet might not be a good idea, but it probably has more potential when adjusted for risk, cost, and potential payout than another traditional indie game. If you want VC money, you need to offer them something that’s got a payout worth the risk.
A better idea would be to find a game publisher. They’re much better equipped to evaluate a game’s feasibility and fund it than a VC. There are publishers at all levels and budgets, plus they often have the infrastructure in place to help a game dev team get things they need, like dev kits and assistance with marketing and cert. You wouldn’t go to a cardiologist to ask about erectile dysfunction, nor would you ask your tax attorney to defend you in a murder trial. If you want to get your game funded, your best bet is to find the right group with the right expertise and interest.
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