Krafton, the creator of BGMI, is shifting its Indian investment focus from gaming to AI and consumer internet. The company has reached a $900 million total investment commitment, with $50–60 million earmarked annually for startups and venture capital. This move follows monetization challenges in the Indian casual gaming market.
Krafton, the South Korean firm behind the popular game Battlegrounds Mobile India (BGMI), is changing its investment strategy in the Indian market. The company has reached a total investment commitment of $900 million, which includes a significant joint fund. Going forward, Krafton is moving its strategic focus away from gaming and toward artificial intelligence and consumer internet platforms.
Nihansh Bhat, who leads corporate development for Krafton in India, stated that the company plans to invest $50 million to $60 million annually. This capital will be directed into venture capital funds and approximately six startups by the end of 2026. This approach represents a shift from passive investment to a model where Krafton provides strategic advice and plays a larger role in the growth of the companies it backs.
The strategic pivot comes after Krafton faced difficulties with the business model of casual gaming in India. While the company found massive popularity with BGMI, it noted that the broader casual gaming sector relies heavily on advertising for revenue. This makes it challenging for studios to grow sustainably without pivoting to real-money games or trying to serve international markets, both of which Krafton has largely avoided.
Krafton is now setting its sights on AI, particularly tools that use Indian-language voice applications. However, management has been cautious, noting that while AI is a significant technological shift, the company is looking for real commercial traction and strong product building, rather than just investing in the current hype. This highlights the reality that even for large companies, betting on early-stage technology remains high-risk.
This is not the company’s first entry into the Indian startup space. Krafton has previously backed companies like the audio platform Kuku FM and the financial services firm Cashfree. These earlier investments were part of a growing portfolio that now also includes the 'Unicorn Growth Fund,' an initiative co-anchored with partners like Naver and Mirae Asset.
Investors should note that while Krafton is expanding its portfolio, its parent company's stock—traded on the Korea Exchange—has experienced volatility, trading roughly 29% below its 52-week high as of August 2026. This reflects broader market pressures on global technology companies. Moving forward, the key for observers will be the performance and commercial viability of the specific AI and consumer internet startups that Krafton announces before the end of the year.