Funding for gaming startups dropped off in Q4 2024 | Konvoy
Konvoy recently released its latest Gaming Industry Report, which covers gaming funding through the most recent financial quarter — in this case, Q4 2024. According to Konvoy’s report, the games industry is expected to complete 2024 as an $188 billion industry, with projected growth putting it at $223 billion by 2029. However, most of the report shows that there wasn’t much in the way of funding for gaming-related startups, nor was there an increase in mergers and acquisitions in that quarter.
One of the key takeaways of Konvoy’s report was that funding for games or gaming companies slowed in Q4. According to the report, $286 million in venture capital funding went to gaming, the lowest funding quarter in over five years with the number being a 47% decline quarter-over-quarter. Most of the decline appears to have come from growth-stage funding. There were also 83 VC deals in gaming, a 25% QoQ decline, with a decrease in early-stage deals.
Konvoy also noted that there had been a decrease in gaming startups that graduate from seed-stage funding to Series A. Only 11.5% of gaming startups that have raised a seed round since Q1 2018 have gone on to raise a Series A round within two years. That’s a smaller rate than the 20-30% success rates of other startups. The number has also declined in recent years: The rate of graduation for startups that have raised seed funding since Q4 2021 has gone down to 4%.
In the previous quarter’s report, Konvoy noted an increase in funding going to gaming startups related to AI. This number appears to have dropped in Q4, with 10% of funding going to such startups, as opposed to Q3’s 22%. Other insights from the report show the estimated sales of the Nintendo Switch against its competitors, the PlayStation 5 and the Xbox Series X/S; as well as the increased scrutiny on gaming companies for their child protection measures.
Konvoy’s complete Gaming Industry Report includes regional insights and is now available on the company’s website.
