Griffin Gaming Partners, a Santa Monica-based venture firm focused on investing in the gaming industry, announced on Wednesday it led a $7 million raise in Fuse Games, an independent game development studio that was founded in 2023.
NFX Capital, Actera and Lakestar participated in the round. Istanbul-based Fuse Games is a mobile gaming studio that currently has one game out, known as “Playground Legends,” which is a multiplayer first-person shooter battle game.
For all of L.A.’s large gaming studios releasing high-budget franchises with sophisticated visuals, the city has also quickly garnered a reputation for its success in mobile games – a type of gaming that, by comparison, is more quick, nimble and cost-effective. Companies like Scopely have found success in mobile games like Monopoly Go – perhaps especially punctuated by the company’s pending $3.5 billion acquisition of Pokémon Go creator Niantic’s gaming division – but investing in nascent mobile games companies are still a risk for firms like Griffin Gaming Partners.
“When it comes to mobile, it’s just so fast-paced where you could push out a game, and then there’ll be low budget developers out of Vietnam, China and so on that can really go out to market with the same innovative title that you have and just blast it out,” said Ibrahim Hafeez, an investor at Griffin Gaming Partners. “So how fast or how good are you at keeping pace? How innovative are you in terms of the marketing and IP side of things? And how good is your tech to be able to push out content and execute at scale?”
The looming presence of AI
Fuse Games announced it would incorporate artificial intelligence into its games, particularly to bolster game mechanics and player experience for its shooter games.
Los Angeles has been the premiere battleground for the use of AI in video games. The Screen Actors Guild-American Federation of Television and Radio Artists (SAG-AFTRA) has led a strike against the major video game companies since last summer over a new Interactive Media Agreement. The two sides have reached an agreement on 24 out of 25 provisions after rigorous negotiations. The last sticking point centers on concerns over generative AI, resulting in the still-ongoing strike of video game actors.
The strike has had an impact on several local large video game developers, including Sawtelle-based Riot Games and its flagship “League of Legends.” The company announced in December it would have to temporarily use existing voice-over recordings can’t say for certain if they are from actors instead of recording custom lines due to the strike.
“We know this isn’t ideal, and we understand it’s frustrating to have to wait for custom VO, but this approach lets us respect the ongoing strike while continuing to deliver new content,” Riot Games said in an announcement. “We’re committed to bringing you updated VO with the quality you expect as soon as we can.”
Despite the setback, it looks like video game companies aren’t letting up on the use of AI any time soon. In March, Culver City-based Liminal Experiences Inc. emerged from stealth with $5.8 million in funding on hand to use AI in video games. The company would use the technology to allow users to build their own role-playing video games – ranging from the characters to their storylines. The company was founded by Brendan Mulligan, a veteran of Riot Games.
“AI has been a core part of game development for 20 plus years now,” Hafeez said. “So, when we’re looking at companies that are AI driven, or AI focused studios, what we’re really looking at is, fundamentally, how is AI supporting development or on the IP side of things or even marketing?”
NFX Capital and Lakestar previously led Fuse Games’ $2 million seed round in 2023.
