Does anyone have any thoughts on this as to what firms have a group for video games? Is it just handled within the tech groups?
It's going to be a huge industry in the future, and I want to know more about it. Would also love to be pointed towards resources on both news/social media that talk about activity and trends in the space.
Yes, I'm a gamer working in finance, and I would love to do something like this for the long term.
I thought from your headline that there was a video game to be a IB/PE/VC/HF person like Madden NFL Football but for finance jobs lol :)
Video game is quite a unique vertical from a banking/investing coverage perspective so I thought I could provide some additional colors. The broad video game vertical mainly includes a large number of game studios plus a few large platform players. For this post, I will just focus on gaming studios (PC/Console/Mobile) which is at the core of the vertical.
The industry itself has already made more money than movie and music combined but is still considered niche from mainstream investors and bankers (at least before the pandemic). The key fundamental shift is the massive and growing engagement hours from all demographics in gaming now vs other media/entertainment channels. These years it has slowly become one of the most active sectors for investment and M&A. Many new startups trying to create the next Fortnite, Candy Crush or Among Us attract billions of dollars while established and new companies found great exits through M&A (and to a much less extent through IPO/SPAC). All factors above combined make it a great vertical for young bankers/investors to focus on if you are passionate about the industry.
Video game M&A tends to be private, smaller than large-cap TMT (a few billion+ deals per year) but very active in the $100-$1bn EV range. From a business perspective, you will focus a lot on BD/positioning given young bankers usually know the product and trend better. From a technical perspective, it tends to be heavily P&L and operating model (metrics, cohort, etc.) focused vs. balance sheet/cashflow/debt /merger math.
Bulge brackets and well-known EBs historically have not focused on this vertical so you won't be able to focus on this vertical (deal flow is not stable even though every bank has a global head of gaming these days). The top boutqiue banks in this space are Aream (exclusively gaming-focused bank in London and SF), LionTree (dedicate gaming team in SF), and Raine (NYC, SF, Shanghai).
A number of gaming-only VCs also got created last few years (almost zero gaming only VC 5 years ago). The top ones are Makers, Galaxy interactive, Griffin (related to LionTree), London Venture Partners, BitKraft, and a few others. A few tier 1 VCs like Index, A16Z, and Lightspeed also have dedicated gaming teams. All major growth equity or private equity firms claim they have huge interests in this vertical now but only a few have actual experiences - KKR, Blackstone, Insight, to name a few.