How to Leverage Government Funding to Kick-Start and Sustain Your Studio
“Government funding is not only about kick-starting a project. It is a strategic tool for sustaining a studio over time and managing burn rate and cash flow.“
– Serge Landry
From Serge Landry, Senior Business Development Manager and Multimedia Lead at Ayming:
After nearly five years at Ayming and meeting video game developers at various industry conferences on both sides of the Atlantic, I can confirm that many new entrepreneurs, and even established studios, overlook the leverage of government funding in their creative journey.
- Government Funding: This refers to non-dilutive financial support provided directly by federal, provincial, or territorial government programs, typically in the form of grants or repayable contributions rather than bank loans or equity investment. These funds are often used to support strategic initiatives such as capital investments, technology adoption, and expansion projects, helping studios accelerate growth and strengthen competitiveness by offsetting a portion of project costs.
- Tax Credits or Tax Incentives: These programs allow studios to recover a portion of eligible expenses, such as production labour, software, and, in some cases, equipment. Many tax credits are refundable, resulting in a cash reimbursement, while others reduce taxes owed on profitable projects. By lowering production costs and improving cash flow, tax incentives play an important role in financing, scaling, and sustaining studio operations.
The jurisdiction where a studio is established is a key factor. Some countries, provinces, or regions offer multiple forms of government funding, while others provide more limited support or none at all. Wage levels and mandatory social contributions in each jurisdiction should also be carefully considered.
Related reading
I explore these jurisdictional considerations in more detail in my annual study, “Where to Open My Video Game Development Studio”, which will be published in Q1 2026 on Ayming’s website.
As with all of our white papers, it will be available free of charge.
Examples of government funding include:
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- IP-Based Funding: These are typically grants supporting the creation of compelling, interactive, or innovative video game projects. Examples include CMF and Ontario Creates in Canada, Creative Europe in the EU, FAJV in France, and FilmFernsehFonds Bayern in Germany.
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- R&D-Focused Projects: These programs take the form of government funding or tax credits aimed at developing new ways to entertain, pushing the limits of existing technologies, or creating new ones. Examples include NRC IRAP and SR&ED in Canada, CIR and CII in France, and Horizon Europe and Erasmus+ in the EU.
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- Interactive Digital Media: When developing a video game title, studios may be eligible for tax credits on wages paid, depending on the jurisdiction and the nature of the project. In some regions, these incentives can represent a significant portion of eligible labour costs. Examples include OIDMTC in Ontario, NSIDMTC in Nova Scotia, CIJV in France, and VGEC in the United Kingdom.
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- Patent or Copyright Tax Incentives: These incentives encourage investment in R&D related to patents and software by offering reduced income tax rates on net profits generated by qualifying IP. Examples include DICI in Quebec, as well as IP Box or Patent Box regimes in France, Belgium, Poland, and Portugal.
Whether a studio is newly launched or well established, these funding programs can play a meaningful role in supporting long-term sustainability. Regardless of where a studio or team is based, overlooking them often means missing opportunities that can materially impact financial planning and growth.
Thank you to Serge Landry for contributing this Guest Insight and sharing his perspective with the XP Gaming community.
Keep an eye on your inbox next week for an XP26 update worth watching for.
Ryan Sno-Wood and the XP Team
