A recent survey of the local game development scene has raised concerns that the sector’s growth is slowing due to a lack of local start-ups and international investors.

The survey was commissioned by the New Zealand Game Developers Association, and independently conducted by Tim Thorpe Consulting. It garnered responses from 27 New Zealand video game developers.

As per the survey, New Zealand video game studios created 134 new high-tech creative jobs in the last financial year, and the sector now employs 568 fulltime employees.

Meanwhile, the sector earned NZ$78.7m in the 2015 financial year – up three percent on last year’s result – and digital exports accounted for 82 percent of that revenue.

“We expect a good year ahead for the established games studios, but we’re concerned that our pipeline of up and coming studios has dried up,” said New Zealand Game Developers Association chairperson Stephen Knightly.

“Tellingly, every local games business with more than 10 employees is at least six years old. We haven’t seen another local success scale up in recent years.

“Although we have a proven track record, skills and the ability to reach global markets digitally, the survey highlights a scarcity of start-ups on track to become the next generation of sustainable studios,” he added.

“Since games are global and digital in nature, with a good prototype it is possible to attract crowdfunding, publishing deals or private investment. But a gap in investment at the early stage is preventing small independent developers from even getting that far.”

According to Knightly, New Zealand is missing out on international game visual effects contracts because local studios are excluded from the relevant visual effects government incentives.

The Postproduction, Digital and Visual Effects scheme offers a 20 percent rebate on visual effects productions completed in New Zealand, and the government recently announced a reduction in the qualifying expenditure threshold from NZ$1 million to NZ$500,000 to stimulate demand for post-production and smaller visual effects companies.

Knightly is keen to see comparable visual effects work for games included in the scheme, in order to generate a greater economic benefit for New Zealand.

“Instead of chasing more but smaller visual effects projects, we could attract higher margin, multi-million dollar game projects,” he said.

“Video game and film visual effects work are comparable and only one criteria needs to be revised to make games eligible.”

In an attempt to stimulate the growth of new studios, the New Zealand Game Developers Association (NZGDA) is once again running its own start-up programme, KiwiGameStarter, which was won last year by survival horror title Phantasmal.

Through the programme, one games business will receive funding, software, and business mentoring support worth more than NZ$25,000. A second studio will also win NZ$5,000 plus software.

According to the NZGDA, the KiwiGameStarter competition aims to help early-stage games businesses develop prototypes ready for investment or crowdfunding. It is supported by Callaghan Innovation, ISP BigPipe, Microsoft, game development tool makers Autodesk and Unity 3D, Pursuit Public Relations, and Hudson Gavin Martin lawyers.

Playable prototypes and business plans for the competition are due on August 28. Details of how to enter are available on the NZGDA website.

Recent New Zealand-made game launches include Outsmart’s Bloodgate, Ice Age Avalanche by Gameloft Auckland, Monsters Ate My Metropolis by Pikpok, and Path of Exile’s The Awakening expansion.