This article was first published on daily blockchain gaming Substack GamesTX.

Compared to the bull run blowout experienced in 2022, it should be little surprise that 2023 was a difficult year, with $1.7 billion of announced funding, down from over $5.3 billion in 2022 and $4 billion in 2021.

Indeed as well as being down 70% compared to 2022, activity was also significantly down compared to 2021, a year that only experienced significant growth during its fourth quarter.

Deal flow

Looking at the total number of deals announced in the sector, 2023’s total of 172 funding announcements – VC raises and token/NFTs sales etc – was down 57% compared to 2022’s total of 397 and flat compared to 2021’s 170 deals. Note, this is based on GamesTX proprietary data, which isn’t comprehensive but has proven to be robust in comparison to other sources.

Unsurprisingly, in no month did the number of deals announced in 2023 beat that of 2022. However, it is worth noting that however small, at least some deals were announced every month, with August’s five being the nadir.

When it comes to the amount invested – a total of $1.7 billion – the trend was similar with 2023’s mediocre monthly amounts dwarfed by 2021 and 2022’s towering totals.

Apart from December, no month during 2023 broke $250 million in total funding raised.

Another way of considering the data is to plot announced deals of more than $50 million over the past three years; what I’m calling a timeline of notable investments.

This shows that there were only two deals worth $100 million or more in 2023, both of which were announced in December: Line Next’s $150 million investment into its Dosi platform and Nexon’s $100 million raise for its MapleStory Universe platform.

Notably, both of these South Korea companies leveraged their existing status as publicly-owned billion-dollar-companies to generate these investments. They didn’t have to deal with VCs or try other options such as token sales.

Otherwise, 2023 was a very quiet year for significant deals, with perhaps the only other notable example being the $40 million CCP Games raised for its blockchain-based reimagining of EVE Online.

And in terms of absolute numbers, the last really big gaming investment was Limit Break’s $200 million in August 2022.