Venture capital funding for games continued to stagnate in Q2 2023 according to PitchBook’s latest market report. While the total value of deals was up 12% from the first quarter (totaling $1.1 billion), the number of closed deals declined 29% to 110.

Both figures fell dramatically compared to 2022, with deal value down 80% and the number of deals falling 57.5% year-on-year. Notably, VC deal values in gaming peaked in Q2 2022 which partially explains the steep drop-off.

Games VC funding is stagnating in 2023 after peaking in Q2 2022

PitchBook noted that deal value was concentrated in more late-stage companies than in past quarters. These more mature companies brought in $611 million or 55.5% the quarter’s funding total. However, early-stage and angel and seed deals accounted for 71.8% of VC games funding in Q2 2023. While undisclosed deal totals are impacting this gap, the data suggests that VC funds are being more selective with their resources amid economic uncertainty.

Moreover, PitchBook notes that VC exits have been few and far between in 2023. In the first half of the year, 19 exits closed for a total deal value of $200 million. While Atari’s $776.2 million acquisition of Angry Birds developer Rovio will boost the annual total, 2023 is on pace to be the slowest year for exits since 2012’s $1.5 billion. Macroeconomic headwinds are likely depressing the market for potential exits.


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Over the last year, gaming content and development startups have attracted the most venture capital funding. Development companies include game engines, developer tools and technology services. Content covers game publishers, studios, developers and platforms as well as gambling providers.

According to PitchBook’s data, 328 gaming content companies raised $2.89 billion in funding from Q3 2022 to Q2 2023. Meanwhile, development startups brought in $1.7 billion across 108 deals. While more capital has flowed to content companies, the average deal size for development companies ($15.8 million) was 1.8-times larger than the average deal closed by content companies ($8.8 million).

PitchBook notes that development startups benefitted from tailwinds in generative AI and user generated content. Monetization & financing startups are also gaining more traction, largely in the form of ad tech platforms. Meanwhile, esports technology, coaching and training startups all struggled.

Geographically, North America continues to command the majority of VC funding. In the first half of 2023, North American gaming companies brought in $1.3 billion in funding, outpacing counterparts in both Asia ($400 million) and Europe ($300 million).

While macroeconomic trends continue to dampen VC funding for gaming startups, PitchBook highlights both UGC and Cloud gaming as significant emerging opportunities.

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