vgames raises $500M for revenue-linked gaming finance model
What's the deal? Israeli gaming fund vgamesDealroom has a profile for this one. Try Dealroom → has raised $500 million for a new financing platform aimed at gaming and consumer companies, backed by insurer Phoenix. The model lets startups fund growth without giving up equity.
Why now? vgames says companies' capital needs shift over time. Early on, they need money to build products and teams; at the growth stage, the challenge becomes financing user acquisition and expansion.
How does it work? Unlike traditional financing or bank loans, repayment is not on a fixed schedule. Instead, it is linked to the revenue generated by the user groups the investment finances, tying repayment directly to performance.
The model targets a challenge common in gaming, consumer, and mobile businesses: heavy spending on user acquisition before those users generate revenue. Companies often wait months, or over a year, to recover marketing costs — forcing them to spend equity capital on growth.
What's the endgame? Founded in 2020, vgames has invested in more than 50 companies and now manages about $500 million in assets. It has deployed over $500 million to gaming and consumer companies worldwide, and plans to provide more than $500 million in additional financing through the new model in the coming years.
The fund is partnering with General Catalyst to identify and evaluate potential companies, drawing on both firms' experience with growth models, including portfolio companies such as SuperPlayDealroom has a profile for this one. Try Dealroom →. Other backed companies include Candivore, Innplay Labs, 44pixels, and PeerPlay.
What they're saying: "As companies mature, their needs change," said founder and managing partner Eitan Reisel. "Through the new financing solution, we enable them to continue growing without giving up ownership in the company and without using equity capital for purposes that can be financed more efficiently."
The signal: Revenue-linked, non-dilutive financing is emerging as an alternative to equity rounds for companies with predictable user economics. vgames is betting that mature gaming and consumer startups increasingly want capital to scale without another dilutive raise.
Read more: Calcalist
Image credit: Official GDC
