New investment scheme PlayFund launches

A new funding initiative has been formed that aims to attract investors with potential returns of 250% within three years.

PlayFund will use the money raised via investors to help support early stage games companies and ensure their projects grow in the way they need to in order to become successful, with those same investors reaping the rewards further down the line.

The scheme will primarily focus on games for mobile devices and tablets, although its creators expect investments to also be made in titles for console and PC as well. Developers will still own their intellectual property rights.

PlayFund has been set up to be an "evergreen fund" so that investors can commit to it at any time, although the minimum investment is £20,000. It has been set up under the UK government's Enterprise Investment Scheme and Seed Enterprise Investment Scheme.

The fund was set up with the help of its head of origination and PlayStack founder Harvey Elliott, formerly of Marmalade Technologies and Electronic Arts. Also involved is former Playstation exec Ray Maguire, who is on the origination committee, and games entrepreneur Jasper Smith.

"Playfund gives UK investors the chance to access the growth of this market through the highly tax-efficient EIS and Seed EIS structures, which provide 30% and 50% tax relief respectively, plus other tax benefits," says Elliott.

"The expertise that PlayFund draws upon means the investments made by the fund will have the greatest chance of success. That's why we believe our target return of 250%, after three years, is highly realistic."

Smith adds: "The underlying principle of PlayFund is that the current independent games sector is broken because of the lack of investment and commercial support for these developer organisations. By selecting the best games and best developers, PlayFund expects to gain a significant advantage against the market and to outperform the fast-growing sector."