As AI reshapes the gaming landscape, Ludeo cuts half its staff while General Intuition secures major funding to build next-gen AI tools for game development.
The global gaming industry is standing at a crossroads — one side marked by layoffs and restructuring, the other by record-breaking AI investments. Two recent events capture this contrast perfectly: Ludeo’s workforce cuts and General Intuition’s $134 million funding round.
Ludeo Faces Layoffs Amid AI Disruption
Founded in 2022 by brothers Asaf and Omri Gazit, Ludeo quickly gained attention for its interactive gaming format that lets users play recorded gameplay segments without owning or installing the full game. Despite raising $42 million from top investors, the company has now laid off 50% of its 50 employees, many based in Israel.
Ludeo attributed the decision to “recent changes in the gaming industry, driven by AI technologies,” forcing a major reorganization of its business model. The move underscores the growing pressure on traditional gaming startups to adapt as AI automation and generative tools transform how games are developed and shared.
General Intuition’s AI Investment Signals a New Era
While Ludeo scales back, General Intuition, an AI gaming startup, is taking off with one of the largest seed rounds of the year — $134 million. The round was co-led by Khosla Ventures and General Catalyst, with participation from Raine Ventures.
A spin-off from the gaming clip platform Medal, General Intuition aims to develop AI agents capable of spatial and temporal reasoning — tools that can help game developers design smarter environments, more realistic NPCs, and immersive simulations.
The company plans to use Medal’s vast dataset of nearly one billion annual game clips to train its AI systems. Beyond gaming, its technology could extend to robotics, autonomous vehicles, and search-and-rescue drones.
Set to launch its first AI-powered simulation tools by 2026, General Intuition positions itself as a public-benefit corporation, emphasizing that its mission is to enhance — not replace — human creativity in game design.
The Bigger Picture: AI’s Two-Sided Impact
The stories of Ludeo and General Intuition highlight the dual nature of AI’s impact on the gaming world. While some companies struggle to keep pace with rapid technological change, others are attracting record investments to push the boundaries of what’s possible.
As the balance between human creativity and AI-driven automation continues to evolve, the gaming industry stands on the brink of a new era — one where innovation comes with both opportunity and disruption.
