Neon Machine’s Shrapnel Faces Financial Difficulties and Layoffs
Shrapnel, a Web3 game once anticipated to rival mainstream titles, faces significant financial challenges. Key points include:
- In October 2023, Shrapnel raised $20 million in Series A funding led by Polychain Capital.
- The company reported operational expenses exceeding $86.9 million since its inception, with a monthly burn rate fluctuating between $2 million and $3.5 million.
- Layoffs have reduced staff from around 100 to approximately 32, with only 20 focusing on game development as of late 2024.
- Neon Machine, the studio behind Shrapnel, has accumulated unpaid debts and lacks a clear financial plan, leading to claims of being a "toxic, failing startup."
- Despite plans for a free-to-play launch in 2025, sources doubt the game's completion or worldwide release due to ongoing cash flow issues.
- Shrapnel aims to enter the Chinese market through a partnership with the government for launching the game on the RWA Trusted Copyright Chain.
- The game's token, SHRAP, has plummeted approximately 98% since its peak in November 2023.
- A recent lawsuit over company funds has been settled, requiring Neon Machine to pay $4.25 million to 4D Factory and issue 150 million SHRAP tokens.
Neon Machine's focus remains on stabilizing finances while preparing for the game's future release.