Matthew Karch of Saber: "Don't Bet Against Embracer Group"

Embracer Group has become a cautionary tale in the gaming industry, a prime example of what happens when a company expands too rapidly. However, Matthew Karch, the founder of Saber Interactive and former member of Embracer's leadership team, believes that the criticism leveled against Embracer has been overly harsh and that the company has made a genuine effort to minimize job losses over the past year. Karch notes that Embracer CEO Lars Wingefors was once hailed as a wonder child, but has since faced intense scrutiny and criticism. Despite this, Karch believes that Wingefors is a humble and reasonable individual who has been guided by a sense of fairness. The process of terminating studios has been difficult, but Karch feels that Embracer has tried harder than most companies to save as many jobs as possible. The rapid growth of Embracer meant that the company had to act quickly when it came to staff reductions. Karch argues that the layoffs were not unusually severe compared to other companies in the industry, and that Embracer has retained many of its valuable assets, including Tomb Raider, Lord of the Rings, and Dead Island. However, the company's size and complexity made it challenging to navigate the restructuring process. Karch suggests that Embracer's struggles were exacerbated by the collapse of a major deal with an external investor, which would have provided significant cash flows. The company's decentralized structure also made it harder to identify and implement cuts. Despite these challenges, Karch remains bullish on Embracer's prospects, citing the company's talented team and promising upcoming projects. Karch also believes that Embracer has been a victim of stock shorting, which has driven down the company's share price and increased pressure from external parties. He blames the company's publicly traded status and the actions of short-sellers for some of its woes. Nevertheless, Karch is confident in Wingefors' leadership and believes that Embracer has made significant progress in streamlining its operations and positioning itself for future success.