[TechCrunch] Investors are betting on user-generated content in video games. Gamebeast’s founder explains why

Today on Equity, Rebecca Bellan sat down with Zander Brumbaugh, the 22-year-old founder of Gamebeast, a startup that offers Roblox developers tools like A/B testing and LiveOps to modify games without needing to release a new version or interrupt a user’s ongoing game.

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Gamebeast recently raised a $3.7 million pre-seed round, led by J2 Ventures with participation from a16z’s Speedrun accelerator, which Brumbaugh graduated from in March. Brumbaugh said everything from his experience consulting for entertainment studios like Netflix, and writing a best-selling book on Roblox development, to chats with investors tell him that the future of video gaming is in user-generated content, or UGC.

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The two discussed the rise in popularity of UGC games, a sector that investors are increasingly looking towards as drivers of growth in the video game industry. Brumbaugh noted that a large majority of kids under 16-years-old asked their parents for virtual currency, like Roblox’s Robux or Fortnite’s V-Bucks, during the last holiday season.  

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Most of the games, experiences, and virtual worlds on Roblox are user-generated, and that’s by design. Fortnite, which is well known for its Battle Royale player-vs-player game, also has a sandbox mode that allows players to build and create their own worlds and experiences. Creative mode is fast gaining popularity.

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“These platforms make it extremely easy to make content from a young age,” Brumbaugh said. “I started when I was 12, and taught myself how to program in Lua and kind of learn my way around the Roblox engine. I think people being able to creatively express themselves and make games that they themselves enjoy, and then also turn that into a profitable hobby, or in many cases, a career, that’s a really exciting thing.”

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On the show, Brumbaugh also shared his thoughts on how generative AI is changing the gaming landscape.

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“You can’t really discuss AI, especially in creative spaces, without there being an immediate knee-jerk negative reaction from a lot of people in the community,” Brumbaugh said. “But ultimately, I think as models get better, the best thing is always going to be integrating these types of models into a workflow, making something easier for developers.”

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Brumbaugh didn’t only get investment for his startup because investors see the value in enabling UGC game development. J2 Ventures’ thesis focuses on dual-use technology, and Gamebeast was able to demonstrate how its tech has applications both in commercial and defense. And indeed, we’re seeing a trend of companies going for that sweet military money to stay afloat.

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There are more insights about the future of the video game market and investor insights aplenty, so have a listen, and enjoy!

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Equity is TechCrunch’s flagship podcast, produced by Theresa Loconsolo, and posts every Wednesday and Friday.

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Subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts. You also can follow Equity on X and Threads, at @EquityPod. For the full episode transcript, for those who prefer reading over listening, check out our full archive of episodes over at Simplecast.