Following the news last Friday that Telltale Games is shutting down, fans have been wondering how and why this happened so suddenly. According to a report yesterday, the culprit is a failed round of funding that Telltale’s board was counting on to keep it above water.
“The company was working diligently to close a round of financing,” Telltale co-founder Dan Connors told Variety. “Unfortunately, when the last potential financial backer abruptly pulled out, we were left in a position where we had no choice but to stop production. Sadly, everyone was so focused on doing what was required to keep the company going that when the last potential partner backed out, there were no other options.”
Connors wouldn’t name the potential financier Telltale was courting, but multiple sources told Variety that it may have been Lionsgate. It wouldn’t have been the first time Lionsgate provided financial backing for Telltale. Lionsgate first invested in the studio in 2015, which eventually led to some strife with Telltale co-founder Kevin Bruner earlier this year.
Lionsgate’s 2015 investment is said to have been for $40 million and was made so that the two companies could create a “super show” that would combine playable content with scripted TV content.
While that project never came to fruition, Telltale did make another seemingly lucrative deal with an entertainment company, this one to bring Minecraft: Story Mode to Netflix and to produce a game based on the streaming service provider’s Stranger Things.
While the Stranger Things game looks like it will no longer happen with the company, Telltale’s remaining employees are working to complete the Minecraft to Netflix port. According to Variety’s sources, Netflix was still on board with the Stranger Things deal, but Telltale’s failed round of financing has left the studio unable to finish the project.
Many employees are said to have been aware Telltale was in some financial trouble that could eventually lead to a closure, but it seems no one was expecting it to happen to sudden. Employees are said to have been caught off guard when they were assembled Friday and told all but 20 were being let go and had just 30 minutes to leave the building.
They received paper checks for their final pay period and were told their health insurance was covered through the end of the month and were encouraged to apply for unemployment by the end of the day.
The initial plan was to give everyone three hours to return and collect their belongings on Monday. But Variety reports that, after seeing the reaction to the news, Telltale has decided to hold a job fair on Thursday. Additionally, CEO Pete Hawley has offered LinkedIn recommendations for any employee who asks for one.
Elsewhere, Melissa Hutchison, who voiced Clementine in Telltale’s Walking Dead games, has expressed her disappointment in the series’ abrupt end. The Walking Dead may yet be saved, however, as several potential partners have expressed interest in helping bring it to the finish line.
Nick Santangelo is a freelance writer based in Philadelphia. He loves video games and sports, but not sports video games. Follow him on Twitter.