“Death lies in the dark”: Indie video game developers fight for survival

Necrosoft Games was running out of money. Given the speed at which things were progressing, the video game studio’s director, Brandon Sheffield, suspected that the company would be bankrupt before its current project, a persona-like role-playing game called Demon Schooldelivered in September.

That was in March, and the outlook was looking bleak. The funding climate for video games was dangerously bad, especially for small projects, and layoffs were happening almost weekly at the industry’s studios. Then a stroke of luck: Sheffield, an industry veteran with over a decade of experience, was able to land a deal for Necrosoft to work on another game. It wasn’t an ideal situation – the studio needed to get the work done while also finishing production. Demon School– but necessary. “It was the only way to survive because nobody was funding anything,” he says. “It’s also better than what happens to a lot of people who just have to give up.”

The studio’s problems are hardly unique. After a rough year of layoffs in 2023, GamesIndustry.biz reported in January that company bosses were already eyeing 2024 as “the year of closures.” Things cooled off after a hiring boom during the Covid-19 pandemic, and now many game developers say mismanagement is making things worse. Ways smaller developers could once rely on to make money, like offering their games as exclusives on the Epic Games Store or Microsoft Game Pass, are no longer open. In March, Chris Bourassa, director of Kill the tower Developer Mega Crit put it bluntly in an interview with PC Gamer: “The gold rush is over.”

Necrosoft bought itself time to get its game over the finish line, but now it – like so many other small developers – remains in a precarious position. “All of our hopes depend on this game being a success,” says Sheffield. “That’s obviously a bad situation.”

As the industry shrinks, independent developers are disappearing everywhere. While some cling to the hopeful refrain of “survive until 25” – getting through this brutal year in the hope that the outlook will improve in the next one – others are less optimistic.

“‘Survive till ’25’ assumes that we are experiencing a long winter, not that we have been burning our own crops for the last three years,” says Xalavier Nelson, studio head of El Paso, elsewhere Developer Strange Scaffold. “If we don’t start planting differently, if we don’t start changing the way we work and think about game development, we’re going to continue to experience the highest highs and the lowest lows that the games industry has ever seen. And it might even get worse.”

The video games The industry seems to be in free fall. However, where a particular company ends up depends on its size. When large companies like Microsoft, Unity, Electronic Arts or Ubisoft want to tighten their belts, they make layoffs, but the company itself continues to exist. For independent game publishers, the consequences are more existential. Since they are often run by small teams of less than a few dozen people, austerity can often simply mean closure.