Takeaways from Web3 Gaming Builders and Investors | Skill Tree #20
Takeaways from Web3 Gaming Builders and Investors | Skill Tree #20
Short newsletter this week as I have too much happening at the same time, ahhhhh. Hopefully there’s still some alpha in there.
Key Takeaways from Web3 Gaming Builders and Investors
Highlights
Still exploring to find product-market fit. Challenges in game design, business model, and audience
Teams focus on fun gameplay, which may put tokens/NFTs as an afterthought
On the other hand, on-chain gaming has gathered interest as it provides a unique experience
Fundraising is challenging at the moment
Web3 Game Funding in May
Highlights
Gaming investments at the lowest level since 4 years
3 new funds were announced in May (Team Intella x Polygon Gaming Accelerator, Red Beard VC, Moonfire VC)
Games are raising small rounds (< $2m) to survive the bear market
Analysis of Stella Fantasy’s game economy
Challenges
Missing supply controls for characters and equipment means risk of a race to zero
The token layer interferes with gameplay as players can either use earnings for progression or to cash out or stake in governance. This can result in lower retention
Emphasis on P2E in marketing leads to self-selection of certain player types and primes players to take a monetary view which potentially reduces spending and creates an imbalance in the economy betweem value creators and value extractors
Staking rewards boost issues #2 and #3