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Gem Capital will invest $50M in Eastern European game studios

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Cyprus-based investment firm Gem Capital plans to invest over $50 million in game studios in Eastern Europe over the next two years.

The firm is focusing on pre-seed, seed, and seris A-round investments, with plans to invest amounts in the range of $2 million to $5 million. Gem Capital’s current portfolio is valued at over $100 million. With a current portfolio valued at over $100 million, Gem Capital is ranked among the top gaming funds in the world, according to market analyst InvestGame.

Gem Capital is looking to invest in free-to-play and premium PC and console titles, as well as midcore mobile games and game-tech companies. The firm already has one of the largest game investment portfolios in Cyprus, Eastern Europe, and the Middle East.

Kirill Gurskiy and Roman Gurskiy are twin brothers who grew up in Moscow. They migrated to Cyprus, and they’re the managing directors of Gem Capital. I interviewed Kirill Gurskiy for this story.

Kirill Gurskiy said, “What distinguishes GEM Capital from other venture investors is that we have a large share of investments in PC/console projects, including premium ones. Over 50% of the investment portfolio is already allocated for studios like Mundfish, Weappy, and Unfrozen. In such projects, we see the potential for creating global IPs and franchises.”

Investing outside of Russia

Gem Capital is investing in Eastern European game companies.

The war in Ukraine broke out in 2022 and many of Russia’s talented game developers spread out around the world in one of the biggest migrations of game talent ever. Many relocated to Eastern European countries like the United Arab Emirates, Armenia or Kazakhstan.

Cyprus had a unique status as a haven for company leaders who set up their headquarters there. But once the war started, many game developers at the studios relocated there. (One of the biggest Russian game companies, My.Games, split into two parts and half of it relocated to Amsterdam under new ownership).

“Cyprus has extremely talented people and the gaming community is very strong,” Kirill Gurskiy said. “We believe strongly in the ecosystem.”

Gem Capital is investing in teams that are outside of Russia itself, though it has funded plenty of Russian-speaking founders. They have chosen not to invest in blockchain games or gambling.

“In our opinion, the intersection of games and blockchain is quite small,” Kirill Gurskiy said.


Gem Capital was founded in 2017 in Cyprus by Anatoly Paliy, a former Gazprom executive who formerly worked in Russia. Its current mission is to help turn Cyprus into a world-class destination for talent. The Gurskiy brothers joined in 2019 and began investing in game companies.

Before joining Gem, Kirill Gurskiy and Roman Gurskiy both spent six years at Ernst & Young, the big accounting firm. They were “huge League of Legends fans,” Kirill Gurskiy said. They still play.

They focused on games because of the growth and the maturity of the market. They loved how games could be launched and distributed worldwide through digital means. And they knew that game entrepreneurs had little access to money in the region.

Like the rival The Games Fund, they saw that the game developers were both creative and highly efficient with capital, which was one reason why Eastern Europe became a major work-for-hire hub for the games and tech industries. Professional venture funds began to focus on games and, along with big game companies, they started pouring money into the region.

A strong foothold in games

Pathfinder: Wrath of the Righteous has been a "mammoth" task for Owlcat Games.
Pathfinder: Wrath of the Righteous has been a “mammoth” task for Owlcat Games.

Since 2019, Gem Capital has invested tens of millions of dollars into games. And it has done more than 20 deals, including investments in Mundfish (maker of Atomic Heart), Owlcat Games (Pathfinder: Wrath of the Righteous), Weappy (This is the Police), Deus Craft (Grand Hotel Mania), Unfrozen (Iratus: Lord of the Dead), Red Rover Interactive (by ex-top managers of Funcom), Eschatology Entertainment (by ex-top managers of Wargaming with Viktor Antonov as Art Director), Gameram (by Philipp Gladkov, ex-CEO of Pixonic, creator of War Robots), game recommendation app Skich, and many others.

“We tried to build a diversified portfolio and we had quite a few wins with this strategy,” Kirill Gurskiy said.

Most of the deals so far are in console, PC and mobile. There are also some investments in social networks for gamers, recommendation services and more.

Owlcat Games’ Pathfinder: Wrath of the Righteous (2021) has sold over a million copies and
was nominated for the D.I.C.E. Awards and the Golden Joystick Awards. It has an 84% rating
on Steam.

And Mundfish’s Atomic Heart is one of the most successful games of 2023 so far, with five
million players in three weeks across PlayStation, Xbox, and PC, and an 85% rating on Steam. It surpassed Hogwarts Legacy to become the No. 1 release on Xbox in 2023 and is the most discussed PC game of 2023 on Metacritic.

The majority of investments were free-to-play mobile games but they also invested in PC and console game studios, including those working on original intellectual property. They noted that many of the winners of the mobile era were not the PC and console game companies. Rather, they were mobile-first leaders like King, Rovio and Supercell — companies that created new brands just for the mobile platform.

Gem Capital is a member of TechIsland, the largest non-profit IT association in Cyprus, and regularly speaks at major industry events. The firm’s offices are located in Cyprus and the UAE, and it helps teams with relocation to these countries.

Gem Capital said it has a strong portfolio, with seven out of the top 10 game startups emerging from Cyprus being portfolio companies of Gem Capital. The average Steam and Metacritic ratings of games developed by portfolio companies are above 80%.

Future investments

Pathfinder: Wrath of the Righteous brings the fire!
Pathfinder: Wrath of the Righteous brings the fire!

For the future, the fund hopes to keep investing in games across multiple platforms, and it will always be looking for great founders and teams. The new $50 million fund will likely be deployed in the next two or three years, said Kirill Gurskiy.

“Founders, team, and vision are the key factors in our investment decisions. While we invest globally, our focus is on studios with Eastern Europe, Cyprus, and the Middle East origins,” said Alex Bykhovskiy, Gem Capital general partner, in a statement.

“We’re looking for entertainment products for mobile, PC/consoles, and VR, as well as game-tech companies. There are no particular genres which we avoid,” said Roman Gurskiy, in a statement.

Kirill Gurskiy added, “Gem Capital believes that PC and console game developers will create an ecosystem around their intellectual properties (IPs), such as TV series, movies, mobile games, and music. Successful IPs must be present on all platforms (PC/console/mobile) and across all spectrums of entertainment. This will generate more interest in the IPs and drive more players to the games, as it appeals to a broader audience.”
Three more deals are pending. The sweet spot for the new fund will be pre-seed deals.

“We generally invest in companies where we see a great track record,” Kirill Gurskiy said.

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