Gaming Investors Seek 'Rock Star' Founders Amid AI Revolution
Translated & summarized from Calcalist by baba
Industry leaders at a gaming conference discussed how AI has simplified game development but increased competition for player attention. Investors are now seeking highly experienced "rock star" founders rather than novices. Despite challenges from countries like Turkey and China, Israel's experienced talent pool remains a key advantage. While AI is a transformative tool, it is not expected to turn every gaming studio into an AI company.
The story in 5 lines · by baba
- AI has made game development easier but increased competition for player attention, according to industry leaders.
- Investors now seek experienced "rock star" founders, not just novices, in the gaming industry.
- Competition from Turkey and China is significant, with some investors favoring games from these regions.
- Israel's experienced talent pool remains a key advantage despite external competition.
- While AI is a crucial tool, it's not expected to transform every gaming studio into an AI company.
The gaming industry is undergoing a significant transformation driven by AI, making game development easier but intensifying competition for player attention, according to industry leaders speaking at a Calcalist, Google, and Playtika gaming conference. Keren Marom, co-founder of Beach Bum, noted that while AI tools have drastically sped up development, the core success factor remains a deep understanding of the gamer. "It's nice to make games, but if people don't return to the game, it's not a success," she stated, emphasizing the need for studios that can diversify risk.
Amir Koyaat, a partner at Griffin Gaming Partners, echoed Marom's sentiment, highlighting the surge in game and content offerings due to AI, which makes retaining players more challenging. He also addressed market valuations, explaining that the post-pandemic correction led to a market overcorrection, with investments now favoring AI for potentially cheaper growth compared to gaming.
Barak Rabinovich, managing partner at F2 Venture Capital, which invested in six gaming companies this year, stressed that investors are now looking for experienced "rock star" founders, not just novices. He pointed to strong competition from China and Turkey, with some investors specifically favoring games from Turkey and Israel, likening gaming to Turkey's cybersecurity sector. Koyaat attributed Turkey's rise to state support and subsidies, while Marom cited lower labor costs and experienced workforces.
Despite external competition, Israeli talent remains a key asset, with the industry's history of producing major global companies providing a strong foundation. However, Rabinovich noted that attracting investment is akin to winning the lottery, requiring a compelling narrative and a strong reason for success, especially with a limited number of gaming-focused funds in Israel. Both Koyaat and Marom agreed that while AI is a crucial tool and the next platform, not every gaming studio will become an AI company, with Marom emphasizing that unique game experiences stem from experienced decision-making.