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Are A.I Video Games The Next Big Tech Wave?
How 433 Investors Unlocked 400X Return Potential
Institutional investors back startups to unlock outsized returns. Regular investors have to wait. But not anymore. Thanks to regulatory updates, some companies are doing things differently.
Take Revolut. In 2016, 433 regular people invested an average of $2,730. Today? They got a 400X buyout offer from the company, as Revolut’s valuation increased 89,900% in the same timeframe.
Founded by a former Zillow exec, Pacaso’s co-ownership tech reshapes the $1.3T vacation home market. They’ve earned $110M+ in gross profit to date, including 41% YoY growth in 2024 alone. They even reserved the Nasdaq ticker PCSO.
The same institutional investors behind Uber, Venmo, and eBay backed Pacaso. And you can join them. But not for long. Pacaso’s investment opportunity ends September 18.
Paid advertisement for Pacaso’s Regulation A offering. Read the offering circular at invest.pacaso.com. Reserving a ticker symbol is not a guarantee that the company will go public. Listing on the NASDAQ is subject to approvals.
The $200 Billion Opportunity: How AI is Democratizing Game Creation and Why You Should Care
What if creating the next Pokémon was as easy as describing it in plain English? Guillermo Rauch thinks we're closer than you might imagine.
The gaming industry just got its ChatGPT moment, and most people haven't even noticed yet.
While everyone's been obsessing over AI writing emails and generating cat pictures, something far more significant has been brewing in the background. Platforms like v0 are already letting people create simple video games with nothing more than a text prompt. But here's the kicker – this is just the beginning.
The "Anybody Can Cook" Revolution
Remember when building a website required knowing HTML, CSS, and JavaScript? Now your grandmother can spin up a professional-looking site in minutes. The same seismic shift is happening to game development, and it's happening fast.
Today, you can literally type "I want a side-scrolling platformer where you play as a robot collecting batteries" and watch a playable game materialize before your eyes. Tomorrow? You might be prompting your way to the next Fortnite.
This isn't just another tech trend – it's the democratization of an entire creative medium that's been locked behind years of technical training and massive development budgets.
The Technical Magic Behind the Curtain
The secret sauce isn't just one AI model doing everything. It's an orchestrated symphony of specialized AI services working together:
Language models interpret your creative vision and break it down into actionable components
Image generation AI cranks out sprites, textures, and environments that match your aesthetic vision
Audio AI (think Eleven Labs but for game sounds) generates everything from footsteps to epic boss battle music
Game engine infrastructure ties it all together into something people can actually play
The platform becomes your creative conductor, guiding you through decisions you didn't even know you needed to make. "Your game needs collision detection – should characters bounce off walls or stop when they hit them?" It's like having a senior game developer sitting next to you, but one that never gets tired or judges your weird ideas.
The Market is Absolutely Massive
Let's talk numbers that'll make your head spin:
The global gaming market hit $184 billion in 2023 and is projected to reach $321 billion by 2026. But here's what's really wild – most of that money is concentrated among a relatively small number of big studios and publishers.
The long tail of game creation has been virtually untapped because the barrier to entry has been so high. When you need a team of programmers, artists, sound designers, and years of development time just to create something basic, most creative ideas never see the light of day.
Revenue Potential Breakdown:
Platform licensing fees: $50-200/month per creator (think Shopify model)
Asset marketplace: 30% cut of AI-generated game assets sold between creators
Revenue sharing: 5-15% of game sales made through the platform
Enterprise licensing: $10K-100K/year for studios wanting to accelerate their workflows
Conservative estimates suggest the addressable market for AI game creation platforms could reach $50-80 billion within the next 5 years as millions of non-technical creators enter the space.
Why This Vertical Strategy is Brilliant
Guillermo Rauch's insight about building "v0 for X" is spot-on. Just like Vercel created v0 as their demonstration of what's possible, the real opportunity lies in creating specialized platforms for specific verticals.
Think about it:
Educational games: Teachers creating custom learning experiences
Corporate training: Companies building interactive simulations
Therapeutic games: Healthcare professionals designing targeted interventions
Marketing games: Brands creating engaging promotional experiences
Each vertical has specific needs, workflows, and monetization models. The company that nails the "AI game creation platform for educational content" could easily become a billion-dollar business by serving just that one market.
How to Get Started (And Why Speed Matters)
The window for becoming a major player in this space is open right now, but it won't stay that way forever. Here's your roadmap:
Phase 1: Pick Your Niche (Months 1-2)
Don't try to be everything to everyone. Choose a specific vertical where you have domain expertise or strong connections. Educational games, fitness apps, or business simulations are all ripe for disruption.
Phase 2: Build Your MVP (Months 3-6)
Partner with existing AI providers (OpenAI, Stability AI, Eleven Labs) rather than building from scratch
Focus on workflow optimization – the magic is in how you orchestrate the AI services, not in the AI itself
Start with template-based generation before moving to fully custom creation
Phase 3: Community and Content (Months 6-12)
Build a creator community around your platform
Create extensive tutorials and templates
Establish partnerships with your target vertical (schools, fitness brands, etc.)
Phase 4: Scale and Monetize (Year 2+)
Implement revenue sharing with successful creators
Launch premium features and enterprise tiers
Consider acquisition opportunities in adjacent spaces
The Competitive Landscape is Wide Open
Here's the beautiful part – we're still in the "Cambrian explosion" phase of AI game creation. The big gaming companies are too focused on their existing IP and revenue streams to move quickly. The traditional game engine companies (Unity, Unreal) are innovating, but they're constrained by their existing user bases and technical architectures.
This creates a massive opportunity for startups to come in and define entirely new categories. The company that becomes the "Shopify of AI game creation" for any given vertical could easily achieve unicorn status within 2-3 years.
The Future is Already Here
We're not talking about some distant sci-fi future. The foundational technology exists today. People are already creating games with prompts. The infrastructure is ready. The only question is who's going to build the platforms that make this accessible to the millions of creative people who have great game ideas but couldn't code their way out of a paper bag.
The next few years will determine whether this transformation happens with you as a driver or as a passenger watching from the sidelines. The tools are here, the market is hungry, and the opportunity is massive.
So here's the real question: What game are you going to build?
The AI game creation revolution isn't coming – it's here. The only question is whether you're going to help lead it or watch others capture the value you could have created. The democratization of game development might be the biggest creative opportunity of our generation. Don't let it pass you by.