Behold Ventures New $58.2 Million Fund

Swedish game venture capital firm Behold Ventures has closed its first fund at $58.2 million (equivalent to 550 million SEK), marking a significant commitment to early-stage game companies in Europe. The fund is managed by Behold Management and led by founder and managing partner Karl Magnus Troedsson, a former triple-A game developer. The fund was launched in 2021, announced in 2022, and has already deployed $21 million across 18 companies.

Behold Ventures New $58.2 Million Fund

Despite broader economic uncertainty, this funding round signals continued investor interest in the European games market, especially in the Nordic region. Of the investments made so far, three are in the United Kingdom, with the remaining based in the Nordics. The fund is structured to support more than 25 startups, focusing on game development, tools, and technology.

Behold Ventures New $58.2 Million Fund

Investor Base and Capital Structure

The capital raised reflects a mix of regional and international participation, with 54 percent coming from Europe, 44 percent from Asia, and 2 percent from North America. The investor base is composed of 42 percent institutional investors, 43 percent strategic partners, and 10 percent from family offices, high-net-worth individuals, and fund-of-funds. The remaining 5 percent of capital came from the fund’s general partners.

In an interview with GamesBeat, Troedsson noted that the initial target was $52.9 million, but due to strong interest, the final amount exceeded expectations. Behold Management’s leadership team also includes founding partners Sigurlína Ingvarsdóttir and Magnus Kenneby, along with principal Brynjólfur Erlingsson, who joined the firm after working as an analytics expert at Mojang in Stockholm. The team has remained consistent in its investment thesis since the fund's inception.

Behold Ventures New $58.2 Million Fund

Focus on Early-Stage European Startups

Behold Ventures is focused on early-stage game companies based in Europe, with particular attention to startups in the Nordic countries. The firm is platform-agnostic and does not prioritize any specific business model, allowing flexibility in evaluating potential investments. While most of the portfolio is comprised of game developers, the fund also seeks opportunities in related tools, technology, and infrastructure when appropriate.

A key area of interest for the fund is companies targeting younger audiences, such as Generation Z and Generation Alpha. Troedsson emphasized the importance of recognizing the generational shift taking place in the industry, particularly within platforms like Roblox, where user-generated content is a driving force. He also pointed out that younger developers often work with smaller budgets and maintain more disciplined financial strategies, which aligns with the fund’s preference for early-stage, cost-conscious teams.

Behold Ventures New $58.2 Million Fund

Adapting to Market Conditions

Troedsson acknowledged that broader industry conditions are challenging, with reduced budgets and increasing caution from investors. He observed that in previous years, startups could raise new rounds during mid-production, but the current environment demands stronger evidence of market traction. Today, early-stage funding must often sustain teams through to the point where key performance indicators and market testing can attract follow-on investment.

Behold Ventures typically invests in small teams of three to five members, which may grow to eight or nine as projects advance. Target investment sizes are in the low millions, and the firm avoids participating in large, later-stage funding rounds. The strategy focuses on creating value early and maintaining flexibility until clear growth indicators emerge.

Behold Ventures New $58.2 Million Fund

Portfolio and Investment Examples

So far, Behold Ventures has invested in several game startups, including Dead Astronauts, Red Rover, and Seven Stars, a studio based in Finland. The firm also joined a $7 million investment in Blue Scarab Entertainment, which is developing a massively multiplayer online role-playing game aimed at a broader audience, including women. These investments reflect the fund’s interest in a wide range of game genres and audience demographics.

Troedsson mentioned that the firm is closely watching user trends and engagement, particularly in mobile gaming markets like Finland and Turkey. While these markets face challenges such as increased user acquisition costs and mobile privacy constraints, they remain areas of active interest for Behold.

Behold Ventures New $58.2 Million Fund

Long-Term View on the Games Industry

Despite current headwinds, Troedsson remains optimistic about the long-term prospects of the games industry. He emphasized that games have become a central medium for entertainment, education, and social interaction, especially among younger generations. While the triple-A sector in Western markets is under pressure, he sees strong ongoing innovation in the indie game space, where small teams continue to deliver unexpected successes.

The firm is also observing growing interest in games from traditional private equity investors, who are increasingly exploring alternative financing structures such as project-based funding. Troedsson believes this shift may create new opportunities for both startups and investors looking for lower-risk entry points into the sector.

Outlook and Industry Trends

Troedsson noted the lack of a clear growth engine in the post-COVID games industry and acknowledged that some industry players are exploring new models to address slowing demand and increased scrutiny around risk. However, he believes the current downturn will eventually stabilize, and the industry will adjust to new norms. He also highlighted the enthusiasm from Asian investors, who continue to show strong interest in gaming as a long-term growth sector.

The recent launch of the Nintendo Switch 2 was cited as a positive development for the industry, providing a renewed sense of excitement around new hardware. Troedsson expressed hope that such innovation would help reinvigorate both investor and consumer interest in games.

Behold Ventures remains committed to its core strategy: investing in early-stage European game startups with scalable ideas and disciplined execution. With a completed fund and a growing portfolio, the firm is positioned to support the next generation of game developers as they navigate a shifting but still promising industry landscape.