By Christopher Bergstresser

Execution Will Decide Who Wins

As I mentioned in part 1, once considered a niche corner of the entertainment & media landscape, the global games industry has become one of the most attractive asset classes for institutional capital. Generating rapidly approaching $200 billion annually and projected to grow at ~7% CAGR through 2030 (Newzoo, Fortune & Fast Company), and according to Dentsu, Forbes, and the Economist, gaming now surpasses film and music combined, sitting at the heart of how audiences spend their time and money.

It’s no surprise that private capital pays close attention. What was once the domain of strategic buyers like console manufacturers or large publishers has evolved into a highly competitive M&A environment involving private equity, venture capital, sovereign wealth funds, and cross-border investors.

Yet one truth remains: simply acquiring a studio is not enough as a foundation for a growth strategy. As the sector matures, a proper foundation is created not at the deal table but in the strategic value that follows - how investors structure portfolios, scale assets, and unlock new revenue layers.

Few organisations embody this approach more clearly than Savvy Games Group (backed by Saudi Arabia’s Public Investment Fund) and Tencent, the Chinese technology giant whose gaming portfolio is now a global force. Both have shown that success in this sector requires long-term thinking, ecosystem-building, and pragmatic operational alignment — lessons that private equity investors would do well to follow.

Here are five ways PE firms can unlock real, compounding value in the games industry.

Build Ecosystems — Not Portfolios

From my perspective, most PE approaches to gaming still resemble a traditional roll-up: acquire studios, consolidate costs, and grow revenue. While this can work to some degree, the most significant returns increasingly go to those who build ecosystems rather than collections of assets.

Savvy Games Group provides a reasonable blueprint. Rather than simply acquiring studios, Savvy has strategically assembled complementary capabilities across the value chain — from ESL FACEIT Group (esports infrastructure) and VSPO (China’s leading esports events platform) to Scopely (a global mobile games publisher with a robust live-ops portfolio). These aren’t isolated bets; they form an integrated network designed to capture user attention, monetise engagement, and expand across verticals.

Tencent has followed a similar playbook. Its investments in Riot Games, Epic Games, Supercell, and Krafton aren’t just about “owning” great titles - they’re about building a web of capabilities across genres, geographies, and distribution channels. Tencent’s ecosystem strategy gives it influence over key segments of the industry, from game engines to esports to mobile publishing.

For PE, the lesson is clear: ecosystem thinking compounds returns. Synergies emerge not just from cost savings, but from shared technology, audience data, monetisation platforms, and cross-promotional reach.

Think Global from Day One

One of the most common mistakes I have seen investors make is treating gaming as a regional or single-market play. The reality is that gaming is inherently global - culturally fluid, digitally distributed, and monetised across multiple platforms and regions.

Savvy’s portfolio is deliberately international: Scopely anchors its presence in Western markets, VSPO strengthens its position in China, and KOFI Studios expands reach across the MENA region. Each acquisition builds geographic diversification into the portfolio, mitigating regulatory risk and positioning the group for growth in multiple markets simultaneously.

Tencent’s investment strategy is similarly borderless. By taking stakes in studios from the U.S. to Europe, Korea, and Japan — often as a minority shareholder — Tencent hedges against local market volatility and gains insight into global player trends, development pipelines, and emerging technologies.

For PE firms, this global approach is more than a hedge - it’s a growth accelerator. Diversified market exposure not only reduces risk but also increases optionality when it comes to distribution partnerships, cross-market launches, and future exit opportunities.

Pair Capital with Strategic Capabilities

Capital is a powerful accelerant, but in gaming, it’s rarely the limiting factor. What most studios sometimes lack, and what investors must help provide, is the operational and strategic capability to scale.

Savvy has taken a deliberate approach here, investing not only in companies but in building internal leadership and infrastructure to support them. Post-acquisition, Savvy’s portfolio companies benefit from centralised resources, shared data capabilities, and access to a global network of strategic partners.

Tencent has done this for years. Its portfolio companies often tap into Tencent’s distribution muscle, cloud infrastructure, payment systems, and data analytics capabilities. These shared services enable relatively small studios to become global category leaders under a Tencent umbrella.

For private equity, this means going beyond financial engineering. The most successful investors are those who bring expertise, talent, and technology into the portfolio, transforming each acquisition from a standalone studio into a scalable group platform.

Unlock New Revenue Layers Beyond Games

The highest-value companies in gaming are no longer just game developers or publishers; they are IP and engagement platforms with monetization streams that extend far beyond the original product.

Savvy’s acquisition of Scopely wasn’t just about mobile games revenue; it was about building a content platform with opportunities in licensing, cross-media storytelling, live events, and community monetisation. Similarly, ESL FACEIT isn’t just an esports brand; it’s an engagement layer that can drive sponsorship, media rights, data services, and brand partnerships across the portfolio.

Tencent’s approach has long reflected this mindset. Its ecosystem connects games to social platforms (WeChat, QQ), streaming, fintech, and advertising, allowing for monetization far beyond the original game sale. This vertical integration significantly increases LTV and strengthens user retention.

For PE investors, the takeaway is simple: look beyond the P&L of the studio itself. The most successful exits will come from companies that evolve into multifaceted IP businesses, ones with revenue from merchandising, media, licensing, esports, and live operations.

Design for Strategic Exits from Day One

Private equity’s endgame is value realisation, and in gaming, an exit strategy must be built into the investment thesis from the start.

Savvy’s approach shows how this can work. Its acquisitions position portfolio companies for multiple future outcomes: maybe a strategic acquirer/investor, or continued scalability/growth within the group. The structure of its investments, often combining majority control with operational autonomy and some operational synergies, allows for pathways for each group company to  continue to expand and innlvate.

Tencent takes a different approach, often preferring minority stakes that create long-term optionality. These investments can evolve into deeper partnerships, influence product direction, or simply provide strategic visibility without operational risk.

For PE, thinking through who the next owner will be, and what they will pay a premium for, is critical. Predictable recurring revenue, diversified markets, scalable infrastructure, and strong IP ownership all significantly impact exit multiples. Build with that profile in mind from day one.

Strategy & Execution, Not Capital, Is the Differentiator

The games industry is at a pivotal moment. As it matures into one of the world’s most valuable and resilient sectors, the competitive landscape for capital is intensifying. But the winners will not be those who simply deploy capital, they will be those who deploy & execute a sound strategy.

Savvy Games Group and Tencent show that value in gaming is created through ecosystem design, global reach, operational enablement, revenue diversification, and exit foresight. Private equity firms that adopt a similar mindset will not only capture outsized returns; they will help shape the future of an industry that is redefining global entertainment.

Key Takeaways

  • Ecosystems outperform portfolios: Build interconnected capabilities that amplify each other, rather than standalone assets.

  • Think globally from day one: Diversification across markets isn’t just a hedge, it’s a growth engine.

  • Capital + capability drives scale: Pair financial resources with operational expertise, data, and infrastructure.

  • Revenue doesn’t stop at launch: Explore IP licensing, cross-media, esports, and brand partnerships to extend LTV.

  • Design with the end in mind: Exit readiness is a strategic advantage; structure your portfolio for premium valuations.

About the Author
Christopher Bergstresser is a veteran games industry executive with over 30 years of experience across PC, mobile, and console platforms. He has led over 50 M&A transactions and built & implemented operational strategies that have delivered measurable value creation for investors, founders, and public companies worldwide. He is currently Co-Founder and Chief Strategy Officer for OV Entertainment (Oceanview Group Ltd.).

‍