Thatgamecompany, the acclaimed developer behind titles such as Flow, Flower, Journey, and the recent hit Sky: Children of the Light, has announced the creation of a new publishing division called Thatgamepublisher. This move places the studio among a growing cohort of successful indie creators who, after scoring a breakout title, expand into publishing or funding roles to uplift other independent projects.
Notable examples include Innersloth, the team behind the viral sensation Among Us, which launched Outersloth in 2024 to back games like Clickolding and The Horror at Highrook; Kinetic Games, known for Phasmophobia, which started Kinetic Publishing and now supports titles such as Precognition from Sam Barlow’s Immortality; Pocketpair, the makers of Palworld, which introduced Pocketpair Publishing; and Landfall Games, the studio behind Peak, which created the Evil Landfall label. The pattern is clear: a small studio achieves a massive hit, generates surplus cash, and then seeks ways to reinvest that capital without ballooning into a large corporate entity. "This is a very common pattern because number one, successful indie games usually are on a shoestring, and if the game becomes very successful, suddenly you have an overflow of cash," explains Jenova Chen, co‑founder of Thatgamecompany. "But then you are a small team [making] games, you don't want to suddenly become a thousands of people company, right?
And then you can't really spend the money, so with additional money, where can you invest? You want to invest in something you understand, something you really are familiar with. So investing into other indie games is a natural choice for everyone, and that's why many indie companies are doing that." When Journey launched in 2012, the studio was far from flush with cash.
Chen has recounted to GamesIndustry.biz that the development of Journey nearly bankrupted the company and resulted in a wave of layoffs. The situation has transformed dramatically since then. Sky: Children of the Light, released in 2019, has become a global phenomenon, especially in the Chinese market, and even inspired a feature‑film adaptation. The revenues from Sky now give Thatgamecompany the financial freedom to fund what it calls "emotionally ambitious" games—projects that aim to touch players on a deeper level than conventional gameplay mechanics alone.
The industry landscape has also shifted. Chen notes that during the early 2010s, distribution channels were largely controlled by platform owners such as Sony. Today, however, "the distribution network is owned by the players, who are influencers." A successful indie title can now reach millions of users organically, as players themselves become the most potent marketing engine. "You have an audience who, let's say, love friendslop games, and they're looking for other friendslop games.
You actually have more influence for distribution than GameSpot, than IGN, than Steam, right? So that's why I think today indie game studios are more likely to become publishers – they also have additional distribution reach," Chen adds. Another distinctive advantage for Thatgamecompany is its demographic reach.
Chen points out that roughly 70 % of Sky's player base is female, giving the studio a larger female audience than most game companies worldwide. "If we promote or feature a game that would be appealing to men and women equally, our audience is going to have a very unique overlap, because there are many of our players who have never played games before," he says. Thatgamepublisher has already signed a "couple" of projects, though the titles remain under wraps. In the official press release, Chen articulated the publisher's mission: "When we first began making games, many people questioned whether interactive experiences could move players as deeply as film, literature or music.
Over the years, games have shown us what impact they can have on people. Lifelong friendships formed.
Personal struggles healed. Loved ones reconnected. Hope restored.
Those moments convinced us that games are capable of touching lives in profound ways. Thatgamepublisher exists because we believe there are countless creators around the world discovering new emotional frontiers for this medium, and we want to help them bring those visions to life." SJ Xue, Thatgamecompany’s vice‑president of growth and corporate development and the lead of the publishing effort, told GamesIndustry.biz that the studio is hunting for titles that "move people through play." He emphasized that genre, platform, or team size are not primary filters.
"The typical genre or platform restrictions would not apply to us," Xue said. "We are open to teams of any size, projects at any stage, and ideas still being prototyped. What matters is not the label, genre, scale, or format, but whether the game reaches for meaningful emotional territory and uses interactivity to take players there." He expanded on the definition of "emotional," noting that it can be joyful, chaotic, even humorous. "The through line is always, will this stay with someone after the screen goes dark?
If a game is chasing that, we want to have the conversation," Xue explained. While many indie publishers limit themselves to sub‑million‑dollar budgets, Thatgamepublisher is willing to back larger, AA‑level projects.
"We are quite flexible when it comes to funding and project scale," Xue said. "We are open to working with everyone from solo developers with immense creativity to larger teams with AA‑level budgets." The financial terms of each deal will be tailored to the specific needs of the project. Xue stressed that, as developers themselves, the team understands the importance of fair, transparent, and developer‑friendly partnerships.
"As developers ourselves, we understand how important it is to build partnerships that are fair, transparent, and developer‑friendly, while giving teams the support they need to realise the strongest version of their game," he remarked. Thatgamepublisher is positioning itself as a full‑service publisher, offering not only capital but also production planning, platform strategy, launch support, marketing, community management, and long‑term IP development. This contrasts with some indie publishers that operate on a funding‑only basis.
The industry trend is moving toward modular publishing models, where developers can pick and choose services such as marketing, console porting, or funding. Luke Keighran, founder of Silver Lining Interactive, told GamesIndustry.biz that "the old school publishing model is dead," and that the modern approach is more flexible.
Xue confirmed that Thatgamepublisher can adopt a modular arrangement if a developer prefers a narrower scope of support. "That being said, we believe the kinds of games we want to work with often benefit from a more integrated partnership," he continued.
"For emotionally ambitious projects, creative development, production, positioning, marketing, community, and platform strategy are often deeply interconnected. Being involved across those areas allows us to bring the most value, protect the emotional core of the game, and help the team carry that vision all the way to players." The overarching philosophy behind the publisher is the belief that games can forge deep, shared emotional experiences.
Xue summed it up: "That belief has shaped everything Thatgamecompany has made, from Flow and Flower to Journey and Sky: Children of the Light. But we also know this path is bigger than the work of one studio. Around the world, creators are exploring their own ways to expand what games can make people feel, and we want to help those ideas find their way to players." He added that emotionally ambitious games often require a different development playbook. "The heart of a project is not always easy to define at the beginning.
It can emerge through prototypes, iteration, quiet discoveries, and the right creative conversations. Our role is to help protect that process, giving developers the room, guidance, and alignment they need to discover the strongest version of their work," Xue explained.
Drawing on its own experience running Sky: Children of the Light as a live‑service title with over 300 million downloads and seven years of global operation, Thatgamepublisher believes it can help other studios scale without diluting the emotional impact of their games. "By understanding the emotional truth of each game, building from its players and community, and allowing genuine resonance to create scale over time, we aim to help every project reach farther while staying true to the feeling at its heart," Xue concluded.