"We expect a good year ahead for the established games studios, but we're concerned that our pipeline of up and coming studios has dried up," he said.
"Tellingly, every local games business with more than 10 employees is at least six years old. We haven't seen another local success scale up in recent years."
As a result, the association is running its own startup programme, the KiwiGameStarter, and Knightly said they are calling for government screen visual effects schemes to be modernised to attract international video game productions.
"Although we have a proven track record, skills and the ability to reach global markets digitally, the survey highlights a scarcity of startups on track to become the next generation of sustainable studios.
"Since games are global and digital in nature, with a good prototype it is possible to attract crowdfunding, publishing deals or private investment. But a gap in investment at the early stage is preventing small independent developers from even getting that far."
The KiwiGameStarter scheme will provide one promising games business funding, software, and business mentoring support worth over $25,000, Knightly said.
It is supported by Callaghan Innovation, ISP BigPipe, Microsoft, game development tool makers Autodesk and Unity 3D, Pursuit Public Relations and Hudson Gavin Martin lawyers.
A second studio will also win $5,000 plus software.
Recent New Zealand-made game launches include Outsmart's Bloodgate, Ice Age Avalanche by Gameloft Auckland, Monsters Ate My Metropolis by Pikpok and Path of Exile's The Awakening expansion, Knightly said.
Playable prototypes and business plans for the competition are due on August 28.
Further details are available here.
