Suddenly, in 2025, the gaming industry is amid its worst venture capital funding slump ever seen. At the same time, video games continue to be incredibly popular, particularly among Americans. Engagement with video games has never been higher. Last year, over 190 million Americans helped to write that future, according to the Entertainment Software Association. In 2023, Americans spent more than $57 billion on all content, hardware and accessories related to video games. This has not translated into investor confidence, as funding levels have plummeted, leading to job losses and a reshaping of the industry landscape.

Global venture funding for gaming-related industry categories has exceeded $627 million as of 2025. So far this year, there have been zero venture rounds of $100 million or more. As such, the industry is on pace for its worst annual funding impasse total in several years. Many developers are under tremendous financial pressure. The 2025 State of the Game Industry report reveals that one out of every eleven developers was laid off this past year. Yet despite a handful of these companies successfully closing rounds, the continuation of this trend paints a very difficult picture for gaming startups.

Venture Funding Highlights

In spite of the larger funding drought, many companies have still found success drawing in large rounds of capital. Congrats to Underdog Fantasy who just nabbed the largest venture round of the year! In April they announced a massive $70 million Series C round, led by Spark Capital. This investment illustrates the continued momentum behind fantasy sports and other gaming-based platforms.

Grand Games, recent player specialized on the global market also announced $30 million of Series A funding. Bigger Games recently raised a $25 million Series A round. These investments, while smaller than previous years' top deals, demonstrate that venture capitalists are still willing to invest in promising gaming startups with innovative ideas.

Istanbul-based Dream Games raised a huge $2.5 billion debt-and-equity round from CVC Capital Partners in May. This investment signals the tremendous growth opportunity available in new gaming markets. At the same time, it highlights the allure of firms with proven success just down the road.

Mergers and Acquisitions

Beyond just venture funding, M&A remains a consistent and growing factor in the gaming industry. The deal followed Scopely’s March acquisition of Niantic’s thematic mobile games business, makers of the global monster hunting hit Pokémon GO, in a $3.5 billion transaction. This mega-acquisition is yet another example of how the gaming industry is rapidly consolidating. Bigger firms are keen to grow their pipelines and engage with novel audiences.

These acquisitions provide smaller studios with much-needed capital and resources. They assist larger companies in shoring up their competitive advantages. Scopely’s acquisition of Niantic demonstrates the impact a power move can have through acquisitions. Moves like this are significant enough to fundamentally alter the competitive landscape in the gaming industry.

Istanbul's Rise as a Gaming Hub

Istanbul is rapidly emerging as a global center for gaming talent, with several successful gaming startups based in the city. Dream Games, Grand Games and Bigger Games are contributing to help establish Istanbul’s beautiful reputation. Together, they’re transforming the city into a dynamic center for gaming innovation.

These well-known companies are attracting some of the best talent and investment to the region. In doing so, they are fostering a rich ecosystem for computing development. Istanbul's strategic location, access to a skilled workforce, and supportive government policies are all contributing to its rise as a prominent player in the global gaming market. The success of these Istanbul-based companies highlights the potential for growth in emerging markets and the importance of investing in diverse talent pools.