Konvoy recently released its latest report on the gaming industry, which covers gaming financing during the last fiscal quarter – in this case, the fourth quarter of 2024. According to the Konvoy report, the gaming industry is expected to complete 2024 as a $188 billion industry, with growth positioned expected to reach $223 billion by 2029. However, most of the report shows that there was not a lot of funding for gaming-related startups, and there was no increase in mergers and acquisitions in the quarter.
One of the key points in Konvoy’s report was that funding for games or game companies slowed in the fourth quarter. According to the report, $286 million in venture capital funding went into gaming, the lowest funding quarter in more than five years, with the number down 47% quarter-on-quarter. Most of this decline appears to have come from growth-stage financing. There were also 83 gaming venture capital deals, down 25% QoQ, with a decline in early stage deals.
Convoy also noted that there has been a decline in gaming startups graduating from seed stage funding to Series A. Only 11.5% of gaming startups that have raised a seed round since Q1 2018 go on to raise a Series A round within two years. This is lower than the 20-30% success rates of other startups. The number has also declined in recent years: the graduation rate for startups that have raised seed funding since Q4 2021 has dropped to 4%.
In the previous quarter’s report, Convoy noted an increase in funding directed at AI-related gaming startups. This number appears to have decreased in the fourth quarter, as 10% of funding went to such startups, compared to 22% in the third quarter. Other insights from the report show the estimated sales of the Nintendo Switch compared to its competitors, PlayStation 5 and Xbox Series As well as increased scrutiny of toy companies regarding child protection measures.
Konvoy’s full gaming industry report includes regional insights and is now available on the company’s website.
