The Games Industry Has a Funding Problem. And We're Watching the Reset

I sat down with Andrew Eiche, studio head at Owlchemy Labs, to talk about why the games industry is struggling right now and what this moment of contraction actually means.We discuss how funding expectations have warped game development, why investors chase only massive breakout hits, and how that pressure stifles innovation across both VR and traditional games. Andrew explains why this downturn feels less like a collapse and more like a reset, similar to past industry corrections, and what tends to emerge on the other side.The conversation also covers Meta’s influence on VR studios, the risks of being locked to a single platform, how generative AI hype is already cooling investor confidence in games, and why discovery and sustainability matter more than ever. Andrew shares insight into how studios survive these cycles, why mid-sized and niche games often endure, and what developers are quietly preparing for as the market recalibrates.This is a candid, developer-led look at the financial realities shaping the future of games and why the industry may need this reset to move forward.