Michael Metzger of Drake Star Reflects on 2025 and Looks Ahead to 2026
How do game industry executives look back at 2025 and what do they think about 2026? We spoke to Michael Metzger, Managing Partner Drake Star, to find out.
GamesMarkt: What is your verdict as you look back on 2025?
Michael Metzger: "2026 was a landmark year for gaming M&A and a year of major shifts across the global media landscape. Two mega deals dominated the headlines. A $55B leveraged buyout of Electronic Arts led by a PIF-backed consortium, and Netflix’s $82.7B announced acquisition of Warner Bros., including Warner Bros. Games. At the same time, Paramount Skydance, the company formed through the merger of Skydance and Paramount, launched a hostile $108.4B bid for Warner Bros. Discovery. Together, these transactions highlighted the scale and intensity of consolidation across both media and gaming.
While dealmaking reached a record high in value, fundraising for gaming companies remained challenging. Total financing rounds in 2025 fell to 509, down from 712 in 2024 and 939 in 2022. That said, activity rebounded sharply in the second half of the year. After hitting a low of 105 rounds in Q2’25, financings rose to 118 rounds in Q3 and 137 rounds in Q4. This momentum suggests a stronger funding environment heading into 2026.
New capital in the sector has increasingly focused on user acquisition financing. General Catalyst has been a major driver in this space, and its gaming focused partnership with VGames is expected to help high-performing studios scale more aggressively in 2026. PvX and Sharp Alpha have also emerged as notable new players in UA focused funding.
On the public markets, the Drake Star Gaming Index, which tracks 35 of the largest listed gaming companies, rose 12% over the year. Performance was led by PC and console publishers, up 17.3%, and Western gaming companies, which gained 15.2%. Unity Technologies, under CEO Matt Bromberg, delivered a standout turnaround and finished as the top performer with a 96.2% gain, followed by Nexon at 63.2% and NetEase at 57.1%."
GamesMarkt: What are your predictions for the gaming industry in 2026?
Michael Metzger: "We enter 2026 with strong momentum and a highly optimistic outlook for gaming and tech M&A, coming off a year defined by blockbuster transactions. Strategic and financial buyers are lining up, with PIF and Scopely, Netflix, Paramount, Tencent, Krafton, NCSoft, MTG, Take-Two, Everplay, Sony, Keywords Studios with EQT, and Jagex with CVC all positioned to be highly active. Private equity is set to remain a powerful force, particularly as a growing number of publicly listed gaming companies are increasingly viewed as compelling take-private opportunities.
On the funding side, we expect a healthy pipeline of seed and early-stage deals, building on the positive momentum seen in the second half of last year, alongside a select group of high-quality mid-to-late-stage rounds. A new wave of user acquisition focused funds is also expected to provide critical growth capital for mid-stage mobile studios. AI, UGC, tools, and next-generation tech platforms continue to stand out as the brightest areas for investment.
2026 is also shaping up to be a defining year for game releases. We expect the long-awaited launch of GTA 6, likely the biggest entertainment release ever, now targeted for November 2026. It will be joined by an exceptional slate of major titles including Marvel’s Wolverine, Resident Evil: Requiem, Lords of the Fallen II, and 007: First Light.
With public markets on the rebound, we also anticipate some gaming IPOs in 2026. High-profile, IPO-ready companies such as Discord, Animoca Brands, and MTG’s SimplePlay are well positioned to tap the public markets and help re-ignite investor enthusiasm for the sector."
GamesMarkt: How is Future Friends Games positioned for 2026?
Michael Metzger: "We enter 2026 with strong momentum and expect it to be a great year for gaming M&A. Drake Star saw very strong deal activity in Q4’25, with 9 M&A and financing transactions, and closed the year with the announced sale of digital avatar platform Ready Player Me to Netflix. This was Netflix’s second major transaction of the quarter, alongside its announced acquisition of Warner Bros., and it further underscores the company’s expanding ambitions in gaming. Netflix plans to use Ready Player Me’s technology to allow subscribers to carry their digital identities, personas, and fandom seamlessly across multiple games and experiences."
Drake Star is a global tech investment bank that has completed over 500 transactions since 2013. The Drake Star team, based in offices across New York, London, Paris, Munich, San Francisco, Los Angeles, Berlin and Dubai, focuses on mergers and acquisitions, as well as corporate finance services, worldwide. The sectors in which Drake Star operates include Consumer & Retail Technology, Digital Media, FinTech, Mobility & Sustainability, Software/SaaS, Digital Services and Industrial Tech. In Q4 2025, Drake Star acted as financial advisers on the acquisition of the avatar technology company Ready Player Me by Netflix.
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