Gaming fund vgames raises $500 million to help startups grow without giving up equity

Israeli gaming fund vgames has raised 500 million dollars for a new financing platform. This initiative targets gaming and consumer startups that need capital to scale but want to avoid the dilution of another traditional equity funding round. The fund secured this capital with the backing of Phoenix.

Since its founding in 2020, vgames has built a portfolio of over 50 companies. While the firm previously focused on acquiring equity stakes, this new model shifts toward growth financing. The capital is designed to support customer acquisition and international expansion. Unlike bank loans with rigid schedules, repayment in this model links directly to the performance of specific user groups financed by the investment.

vgames is collaborating with General Catalyst to evaluate and identify eligible companies. This partnership leans on their combined experience with growth-stage business models. The firm plans to deploy the full 500 million dollars over the coming years to support startups that require liquidity to maintain momentum without sacrificing ownership.

Founder Eitan Reisel notes that companies at this stage often face high costs to acquire users, a process that can take over a year to generate a return. By providing growth capital directly tied to revenue, vgames aims to provide a more efficient path for startups to scale into global leaders.