Finding product market fit in the games industry first was very lucky for Parsec

When we started Parsec, we said, “if it’s good enough for games, it’s good enough for everything.” In 2016, I don’t think we realized how valuable that insight was for the long-term prospects of our business.?And this trend is shaping investment strategies from venture capital firms, like Andreessen Horrowitz. They recently published their Big Ideas in Tech in 2025, and one was Troy Kirwin prediction that "Game Tech Powers Tomorrow's Businesses."

I believe that the games industry is an incredible first market to sell software to, and yet, it’s also a risky one. Before diving further into that, our philosophy at Parsec was to stay maniacally focused on one problem at a time. In the case of our go-to-market strategy, we felt that we needed to win a single market and go extremely deep there. Paul Graham explained that great startup ideas are focused on deep wells, not shallow ponds. Geoffrey Moore helped articulate a B2B strategy focused on Crossing the Chasm from early adopters to the mainstream by staying focused on one referenceable market. In our case, our deep well and early adopters were games companies. I think we got very lucky landing on that.

But first, the risks in selling to the games industry

Before sharing why I think the games industry is a fantastic one to sell software to, I think it’s important to first share the risks that come with selling to the games industry.?

• Small set of enterprise customers? -? There’s a ton of data about how the games industry is bigger than all other entertainment categories combined. Honestly, that’s questionably true because it uses some odd comparison data, but it’s a big industry nonetheless. It’s also an industry dominated by extreme pareto returns among a small set of companies. The winners in the games market are a relatively small set of companies who have gotten even bigger through the recent merger spree in the industry.?
• Longtail has low propensity to pay - The industry also has a very long-tail of studios, but their propensity to pay for software is very low. That’s part of the reason why Unity, the most popular game engine in the world, still struggles to monetize 95%+ of its Engine customers. Without a large enterprise segment and with low monetization rates among the long-tail, products are squeezed into a small group of customers without an escape valve to other industries.?
• Getting trapped into games technology - Some technologies are very specific to the games industry needs. While it will make your core games customers happy, building for those very specific use cases can be a trap.
• Enterprises try to own critical technology - if a product is too important to a game’s success, the enterprise studios will build their own version of it and manage it through their large internal technology teams that support all of their games. That’s because major titles are multi-100 million dollar investments, and they will not risk the success of that game on a third-party tool that they do not control. They will feel the need to own it, so they can make custom modifications to it.
• Games branding is difficult to escape - I saw how challenging it was to slowly pivot the Parsec brand from a games-focused one to a more general purpose, enterprise brand. We tried to stay true to our core games market through subtle references on our website, while making sure every company knew that Parsec was for them too. It was a very challenging needle to thread, and I don’t think we succeeded.

Games customers make a product better and accelerate adoption

While that’s all true, games companies are an amazing place to start selling software to. They demand the best, and they forced Parsec to be great. The people who work on games are technologists working on the frontier of what’s possible with every release. They know what a great technology experience feels like, and they demand that feeling from their vendors. If a product can impress them, it can impress anyone. Product-led growth also happens to work really well in the games industry for a couple reasons.?

• The middle market and long-tail are happy to try new technologies.?
• Game developers are typically given a lot of freedom to build projects in their own time. They’re really open to trying new technologies in these side projects. Even when Parsec was primarily sold to consumers, we saw a lot of activity that looked like people working on something. We never tracked what people did in Parsec. We could, however, see people spending hours connected to computers consistently and on their own.
• Consumers love to talk about game technology with game developers. Consumers hangout in Discord with game developers, and they spend time talking about technology choices and game developers are typically more than happy to share. Parsec gained tons of traction through Discord and we built a community with nearly 100,000 people engaging and talking about our technology.
• While enterprises are large companies, at Parsec, we noticed that purchasing was very decentralized. Most first-party studios have the ability to choose their own vendors rather than accepting top down mandates from the corporate publisher. We saw this repeat over and over. The earliest example was when The Coalition chose to start working with Parsec and then recommended us to other Xbox Games Studios. That relationship started with one person deciding to try Parsec and signing up with his credit card. This same thing happened at EA, Activision Blizzard, Ubisoft, Playstation Studios, and more.?
• The games industry is also an extremely dense community. Everyone talks to each other and people switch between studios frequently. That density makes it much easier for word to spread from one studio to another.?
• Games people frequently switch to other entertainment segments. When we wanted to expand to new markets, we found that there were pockets of people using Parsec in broadcast and media companies because they had previously worked on the esports broadcast and VFX teams inside game studios. The knowledge transfer between the games industry to other entertainment verticals happens naturally and quickly.?

Every company is selling to gamers, and they need gaming technology

That transfer of knowledge from games to other industries goes beyond entertainment. Consumer preferences are forcing every company to think like they’re selling their products to gamers. We saw this at Parsec, and I saw the same at Unity. Nearly every consumer in the world is a gamer, and those consumers demand experiences from the businesses they engage with to feel like the games they play. This is forcing non-games companies to invest heavily in interactive 3D technologies. Manufacturers, real estate firms, retailers, and others are recruiting game developers to join their teams to build those interactive digital twins. At Unity and Parsec, we were able to branch into these industries because someone was familiar with our technologies from when they were previously working in the games industry - adoption always seemed to start with one person bringing us into their new business.

When we started Parsec, I wasn’t aware of the risks and opportunities in selling fist to the games industry. Now that I’m aware of the risks, I can prepare for them. I plan to look for ways to sell my new product to the games industry because the tailwinds that propel software vendors selling to the games industry are an incredible accelerant to grow well beyond the reach of that industry.