Last year, its fulltime staff increased 29% to 1418. Keene expects that number to head north again.<\/p>\n
Preliminary figures show the local video game industry will top $1b revenue for the first time in the year to March 31, 2025, from $759m last year (above). Its $1b revenue by 2028 target was set in 2023. Source \/ NZ Game Developers Association Industry Survey 2025<\/p>\n
The sector credits a tax rebate introduced by the previous Government for its recent growth spurt, which followed a couple of years of stalling.<\/p>\n
The $40m per year Game Development Sector Rebate (GDSR, New Zealand-owned early-stage) returns 20c on every dollar spent to create a game.<\/p>\n
It was set up in 2023 and left untouched in Budget 2025 after leading game studios said they would have no choice but to decamp across the Tasman<\/a> if our government did not match similar schemes introduced by Australia\u2019s Federal and state governments.<\/p>\n The gaming sector also argued it needed a level playing field in its war for tech talent with the heavily subsidised movie industry.<\/p>\n The current Government has been credited with expanding a second scheme introduced by Labour, \u201cCode\u201d (Centre of Digital Excellence), with grants for small game developers boosted from $2.75m to $5m per year with Budget 2025.<\/p>\n The big dogs of the local industry have traditionally been the most sophisticated operations, including West Auckland\u2019s Grinding Gear Games<\/a> – the maker of global multiplayer fantasy hit Path of Exile. <\/p>\n It reported $105m revenue last year. Other big players include the Auckland and Dunedin-based Rocketwerkz<\/a> (maker of Icarus and other titles) and Wellington\u2019s mobile specialist PikPok<\/a>, which employs more than 200 staff.<\/p>\n But Keene says the $1b-plus tally for the year to March 31, 2026, includes \u201cat least $200m from new games\u201d.<\/p>\n The past 12 months have seen two up-and-coming game studios have monster global hits on the relatively low-fi Roblox platform, best known for kids\u2019 fare and \u201ccosy games\u201d. <\/p>\n \u201cTwo of the three biggest concurrent player records ever set on Roblox were achieved by Kiwi creators,\u201d Roblox executive Matt Kaufman told the Herald earlier this month.<\/p>\n 99 Nights in the Forest (by Grandma\u2019s Favourite Games) reached \u00a0a massive 14 million concurrent players and is still a top Roblox game today;Grow a Garden (from Splitting Point Studios) shattered the all\u2011time world record for concurrent players across any video game – not just on Roblox – with more than 22 million people playing simultaneously (Fortnite\u2019s record is 16m). \u201cThat\u2019s nearly four times the population of NZ, playing at the same time,\u201d Kaufman said.<\/p>\n Roblox games are free, with their creators earning revenue from in-game purchases.<\/p>\n Splitting Point Studios was founded by Janzen Madsen who earlier told US website Business Insider that, as a teen, he earned US$2 from his first Roblox game in 2017.<\/p>\n By 2020, he was earning US$40,000 per year from the platform, working from the basement of his parents\u2019 home, and by 2023, \u201csix figures per month\u201d.<\/p>\n Madsen messaged the Herald last night: \u201cWe don\u2019t disclose revenue publicly, but we\u2019re really proud to be part of the New Zealand games industry and to see it reach such a big milestone.<\/p>\n \u201cWe\u2019ve been fortunate to see strong momentum across our work, and we\u2019re hopeful Splitting Point can continue growing and remain a meaningful contributor to the wider industry here.<\/p>\n \u201cNew Zealand is an export-driven economy, so wins in emerging markets like games are worth celebrating.\u201d<\/p>\n Late last year, Madsen posted to LinkedIn: \u201cThe New Zealand GDSR, a tax rebate aimed at keeping game development jobs in New Zealand, was immensely pivotal in our decision to hire local talent when we went from a team size of 10 to now over 50.\u201d Just under half are based in NZ.<\/p>\n Overnight, he told the Herald: \u201cThe rebate is very helpful for curbing some of the competitive incentives overseas.\u201d<\/p>\n Before the GDSR was introduced, offshore studios who enjoyed better tax breaks poached staff.<\/p>\n \u201cFor us, we also see it as a way to help upskill our employees in Roblox, since it\u2019s so different to traditional gaming; it\u2019s nice to have a bit of assistance while people get up to scratch on the ecosystem,\u201d Madsen said.<\/p>\n \u2018Learn to run a business\u2019<\/p>\n At the time, an issue had been identified with the rebate: only around half of $40m on the table each year was being claimed (and the fund does not roll over).<\/p>\n Some said the problem was that the large studios were capped at $3m per application, when they spent far more developing top-tier games. Labour said it would raise that limit.<\/p>\n But Madsen has qualms.<\/p>\n \u201cMy view is just that if the programme is being expanded or adjusted, more of the weighting should go toward early-stage and New Zealand-owned studios that are trying to build sustainable IP [intellectual property] and export businesses from here,\u201d he messaged the Herald post Budget 2026.<\/p>\n \u201cI think the biggest upside for NZ comes from helping local studios scale into global companies, rather than simply raising caps in a way that mostly benefits already profitable offshore operators.<\/p>\n \u201cWe have around 20 staff in NZ \u2013 and that assistance was actually a big driver in our decision to start hiring in New Zealand.\u201d<\/p>\n Big players attract offshore investment, takeovers<\/p>\n Grinding Gear Games is now 100% owned by Chinese giant Tencent, which paid somewhere above the Overseas Investment Office approval threshold of $100m for an 80% controlling stake in 2018.<\/p>\n Rocketwerkz is 47% owned by Tencent (with the balance owned by its Kiwi founder, Dean Hall).<\/p>\n Other offshore sales have included Auckland smartphone and tablet game maker Ninja Kiwi (maker of the enduring global hit Bloons), which was bought<\/a> out by Sweden\u2019s MTG for $203m in 2021.<\/p>\n \u20188 to one return\u2019<\/p>\n Keene earlier said that $22.4m was paid to video game companies under the scheme last year, but they returned more than $115m to Crown coffers through income tax and PAYE.<\/p>\n \u201cFor every dollar invested via the GDSR, the government has a direct return of $4.74, underlining the fiscal impact of the sector\u2019s rapid growth.\u201d<\/p>\n For this year, the final figures are likely to see close to $8 returned for every $1 invested via the rebate, Keene says.<\/p>\n \u201cWe\u2019re seeing a truly inspiring industry success story here \u2013 our local game development sector is growing at more than 20 times the global average, year on year.\u201d<\/p>\n Stayin\u2019 alive<\/p>\n Madsen, who attended Waimea College in Nelson, has largely kept a relatively low profile.<\/p>\n In 2014, aged 16, he fleetingly appeared in a local paper as he toured NZ as part of his father\u2019s Bee Gees tribute act<\/a>.<\/p>\n His Instagram account<\/a> shows him touring the world with his partner.<\/p>\n But Madsen\u2019s local assets \u2013 on the local property front, at least \u2013 are relatively modest. Public records show him owning two homes in the upper South Island: one with a rateable value of $1.85m, the other with an RV of $800,000.<\/p>\n Hobby to Hollywood<\/p>\n The Grandma\u2019s Favourite Games crew consists of Matthew Hufton, Cameron Angland and Alec Kieft \u2013 better known in the Roblox universe as ForyxeV, Viridial and Cracky4.<\/p>\n Hufton and Angland grew up in New Plymouth, while Kieft was on the K\u0101piti Coast. The trio met on Roblox in their early teens<\/a>.<\/p>\n In 2018, while still students, Hufton (Auckland University\u2019s engineering school and Kieft (doing a BA in Information Systems at Victoria) spent three months as interns on Roblox\u2019s \u201cAccelerator\u201d programme in San Mateo, California. <\/p>\n Madsen did the same programme, and he and Hufton collaborated on several games during their early Roblox days, including one for the makers of Sesame Street.<\/p>\n After graduating in 2021, Hufton spent 18 months as a hardware engineer at smart cow start-up Halter before going fulltime as a Roblox developer.<\/p>\n The trio thought they were gaining momentum when they had several hundred people playing their games at once, then tens of thousands by their third hit. But with the release of 99 Nights in the Forest in May last year, their concurrent players hit the millions.<\/p>\n There was another breakthrough in April this year, with Disney-owned 20th Century Studios announcing it would develop a movie based on 99 Nights<\/a>, with Hufton, Kieft and Angland getting executive producer credits.<\/p>\n There is \u201cserious money\u201d to be made on Roblox, into the six-figure range, Hufton told the Herald earlier this month.<\/p>\n \u201cIt is a super viable career path, especially if you\u2019re at all inclined to create video games,\u201d he said.<\/p>\n He advised young Kiwis interested in programming to \u201cjust jump in and make something you would enjoy playing\u201d.<\/p>\n He and his crew have played their financial cards close to their chest, but Hufton\u2019s choice of wheels indicates he\u2019s not hurting. He was recently pictured<\/a> with his McLaren 570s Coupe (sticker price: $339,000). <\/p>\n Chris Keall is an Auckland-based member of the Herald\u2019s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.<\/p>\n\u201cBefore receiving the GDSR, only about 5% of our workforce was based in New Zealand, whereas now it\u2019s almost a 50\/50 split as a direct result of the GDSR,\u201d says Janzen Madsen, founder of Grow a Garden owner Splitting Point.<\/p>\n
99 Nights in the Forest challenges players to survive a spooky forest setting. <\/p>\n
Grow a Garden, where you nurture crops, is part of the “cosy game” boom that began during pandemic lockdowns. W\u0113t\u0101 Workshop also jumped on the craze with its Tales of the Shire.<\/p>\n
99 Nights in the Forest developers Cameron Angland, Matthew Hufton and Alec Kieft met as preteens on Roblox.<\/p>\n
Angland, Kieft and Hufton are active in the Roblox community, frequently flying to the company’s offices in the US.<\/p>\n