Decline in Gaming M&A, Yet Fundraising Doubled in 2024 by Quantum Tech Partners
Gaming mergers and acquisitions saw a slight decline to $11.5 billion in 2024, as reported by Quantum Tech Partners, a company specializing in M&A advisory services. Despite this drop, fundraising essentially doubled during the same period, hinting at a shifting landscape for the industry in 2025.
Alina Soltys, a partner at Quantum Tech Partners, mentioned that 2025 had the potential to be more favorable for the gaming sector. Some notable M&A deals from 2024, such as EQT acquiring Keywords Studios for $2.8 billion and Playtika purchasing SuperPlay for up to $1.95 billion, helped maintain a relatively flat trajectory for gaming M&A activity following the significant growth during the pandemic.
While M&A and fundraising are often viewed as positive signs for the gaming industry, indicating an influx of capital and experienced professionals exiting the field, there is a contrasting reality on the ground. Despite the rise in fundraising activities, the gaming industry faced significant job losses, with over 15,000 layoffs during 2024. This accumulated to an estimated 34,000 jobs lost in the preceding years, pointing to a challenging employment landscape despite the financial investments.
Following a prosperous year in 2022, the gaming industry’s M&A activity has experienced a period of stability in recent times. As companies are now better poised with healthier balance sheets and sufficient cash reserves, they are eyeing potential acquisitions to drive growth. Quantum Tech Partners is only one of several companies presenting financial data for the gaming industry in 2024, alongside firms like Drake Star Partners, Konvoy Ventures, and Hiro Capital, each providing varying perspectives on the market trends.
Looking ahead to 2025, Soltys mentioned some factors likely to influence the industry’s growth, including the release of the Switch 2 and the anticipated launch of Grand Theft Auto VI. These factors could attract broader attention and contribute positively to M&A and fundraising activities in the coming year.
Despite the seeming struggles with fundraising in the industry, the data reveals a different story. While the actual perception may suggest a slowdown, total fundraising actually doubled in 2024 compared to the previous year. The average raise per deal increased significantly from $12 million to $27 million, with the quarterly funding also showing consistent growth over the years.
One standout trend in 2024 was the increased investment in late-stage deals, bucking the trend of early-stage game startups receiving the lion’s share of funding. Notably, major M&A transactions were influenced by Embracer Group’s efforts to reduce its debts by divesting divisions, leading to significant sales in 2024. Additionally, Web3 companies garnered $1.76 billion across 325 deals, with substantial raises for companies like Infinite Reality, Zentry, iD Planet, SPFweb3Meta, and Azra Games.
In conclusion, the gaming industry’s landscape presents a complex picture of financial growth intertwined with job losses and industry transformations. As 2025 unfolds, it will be interesting to see how these dynamics continue to shape the future of gaming M&A and fundraising activities.
