Dontnod, creator of games such as "Life is Strange," "Tell Me Why," and "Vampyr," announced today that Chinese tech giant Tencent has acquired a minority stake in the company for €30 million.According to Dontnod, the funding will enable indie developers will be able to create more games for a global audience on all platforms. At the same time, the investment includes a new "business cooperation agreement," which CEO Oskar Guilbert says will help Dontnod "leverage various growth drivers in the video game industry, especially in China and mobile platforms, in collaboration with industry leaders."

He states.

The key, obviously, is China. China's gaming industry is the largest in the world, but it is extremely difficult for non-Chinese developers to enter the market. Due to strict government regulations, it is impossible to publish a game in China without partnering with a Chinese company responsible for the distribution and operation of the game. This is exactly why games like "World of Warcraft" are subscription-based in the global version but free-to-play in China, or why games like "Counter-Strike" have Chinese player-only versions.

The deal probably means that Dontnod will start selling games through appropriate Chinese gaming platforms like Tencent's WeGame, rather than relying on Steam or Apple's app store. Steam is available in China, but legally gray zone and unstable, and while it is used by 30 million Chinese gamers, it is far from the largest gaming platform. By partnering with Tencent, Dontnod will have access to a much larger user base.

Tencent also has the option to offer representation on Dontnod's board of directors with this investment. However, as a minority shareholder, Tencent cannot make management decisions.

This new investment follows almost immediately after Tencent acquired a majority stake in indie developer Klei Entertainment. Tencent is one of China's largest tech companies, rivaling Facebook and Apple, and the world's largest gaming company. In addition to Riot Games, makers of League of Legends, the company owns minority stakes in a variety of major gaming companies, including Activision Blizzard, Ubisoft, and Epic Games.

Tencent has aggressively stepped up its investments in and acquisitions of gaming companies in recent years; in 2020, it invested in 31 gaming companies (though most were small and medium-sized Chinese companies).

The list of major gaming companies in which Tencent has invested is as follows.