I Thought Games VC Would Evolve, Not Devolve.

Here's what I learned about the broken state of games fundraising

I fucked up by assuming venture capital would get smarter about games over time, not dumber.

After 15+ years building games companies and currently raising for RIFT, I'm witnessing something I didn't think was possible: seed rounds that ask for Series A metrics, VCs acting like exploitative publishers, and an entire funding ecosystem that's forgotten how breakthrough games actually get built.

What I Got Wrong

I assumed that after the mobile games boom, the blockchain gaming hype cycle, and multiple waves of overfunded, underdelivered gaming startups, investors would develop more sophisticated frameworks for evaluating games companies.

Instead, they've done the opposite.

I'm sitting in seed meetings where investors want to see ROAS curves and retention cohorts that would make a Series A company blush. They're asking for marketing efficiency data from budgets I'm trying to raise. Some are even proposing revenue carve-outs instead of traditional equity deals.

When VCs start acting like publishers, you know something's fundamentally broken.

The Real Fuck-Up (And It Wasn't Mine)

Here's what actually happened: 2-3 years ago, a specific type of entrepreneur dominated games fundraising. Charismatic founders who raised $40M+ rounds, paid themselves $600K salaries, and burned through capital without the operational discipline that comes from actually building companies from zero to one.

The DPI on those vintages is now essentially zero.

And every legitimate games entrepreneur is paying for those investment decisions.

What I'm Learning Now

The entrepreneurs who should get funded—those with deep networks, proven execution ability, working on genuinely innovative technology—are being evaluated by metrics designed for companies that have already found product-market fit.

At RIFT, we've built StoryEngine, a multiplayer narrative platform unlike anything in the market. Our first game, The Consulting Detectives, has 1,000+ sessions with 12+ minute average session length and strong viral mechanics.

But seed investors still want to see ROAS curves from marketing spend we haven't deployed yet.

The Impossible Situation

This creates what I call the games funding trilemma:

Publishers want proven metrics before partnership, but are increasingly risk-averse and extractive.

Government funding exists but is sparse, slow, and misaligned with commercial timelines.

Venture capital has moved the goalposts to require traction that needs their capital to achieve.

Even when you prove early traction, investors expect you to simultaneously fund development and marketing to generate data they want to see—with money you're raising to get.

The Expensive Truth About "Cheap" Games

Yes, games are cheaper to make today. But great games aren't.

Great games aren't great because their first 20 seconds of onboarding are polished. They're great because of underlying systems and technology that create lasting relationships with players: relationships that compound over years, not quarters.

You cannot build systems that support persistent, social, multiplayer experiences on what venture capital now defines as "lean."

What I'm Learning to Do Differently

The most promising games companies I know are bootstrapping longer than they should, taking dilutive publisher deals, or simply not getting built at all.

I remain optimistic about the games industry's future. Technologies like AI, persistent worlds, and social platforms are creating entirely new categories of entertainment. The audience is massive and growing.

But I've learned that expecting the funding ecosystem to evolve naturally was naive. We need to actively build new bridges between capital and entrepreneurs who understand both technology and entertainment.

The Lesson

I fucked up by assuming market forces would naturally create better funding mechanisms for games. Instead, I should have been building those mechanisms myself.

The capital is there. The entrepreneurs are there. The market opportunity is enormous.

What's missing—and what someone smarter than me needs to build—is the bridge between them.