Tencent Sets Its Sights on Building the Next Larian or FromSoftware

Tencent wants to help cultivate development studios capable of reaching the heights of Baldur's Gate 3 and Elden Ring, but its stated plan is not built around finding an instant blockbuster. Instead, Tencent Games VP and head of operations, strategy, and compliance Yong-yi Zhu has described a strategy centered on patient investment, specialized creative teams, and allowing developers to improve within a genre across multiple projects.

For Tencent, Larian Studios and FromSoftware represent the kind of long-term creative growth it hopes to support. Their biggest recent games may be cultural and commercial landmarks, but neither arrived in a vacuum. Larian's success with Baldur's Gate 3 followed years spent refining its approach through the Divinity series. FromSoftware's path to Elden Ring, meanwhile, moved through Demon's Souls, the Dark Souls games, and Bloodborne.

Zhu called Larian and FromSoftware "North Stars" for the company's development ambitions. The comparison is revealing because it is not simply about sales, prestige, or recognizable intellectual property. It is about studios that stayed committed to a particular design identity long enough to become leaders in their categories.

Genre mastery over short-term imitation

Tencent's stated approach places the emphasis on talent and distinct creative vision rather than treating development as a primarily regional exercise. Zhu said the company looks for teams with a focused perspective and a willingness to continually sharpen their craft. In that model, a studio does not need to be the genre leader immediately. It may take two or three games before its capabilities, processes, and audience trust reach that point.

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That is a notably different target from simply commissioning games that resemble current hits. The lesson Tencent appears to draw from Larian and FromSoftware is that successful studios are not defined by copying an individual game's surface-level features. They are defined by building a recognizable body of work, learning from each release, and carrying the best ideas forward into increasingly ambitious projects.

Baldur's Gate 3 is a useful example. It is based on Dungeons & Dragons and uses the Baldur's Gate name, but its structure, systems, reactive quests, and approach to player freedom clearly reflect the experience Larian developed through Divinity: Original Sin and its sequel. The game brought a major licensed universe into Larian's established creative language rather than requiring the studio to abandon that identity.

Likewise, Elden Ring drew on lessons FromSoftware had explored over many years. Its open world represented a massive expansion in scale, but its combat, environmental storytelling, challenge-driven progression, and player discovery all evolved from foundations established in the company's earlier action RPGs. The result was not a sudden reinvention by an unproven team. It was the culmination of a long period of iteration.

A long-game model for studio growth

Zhu said Tencent is attempting to apply that philosophy to its internal studios as well as its broader development relationships. The core idea is a long-term commitment to teams that demonstrate progress toward category leadership, even if the payoff is not immediate.

That perspective matters in an industry where premium game development is often judged on a narrow release-by-release basis. Large single-player releases can take years to make, require substantial upfront funding, and arrive with enormous expectations. When a project underperforms, the impact can be severe for the developer and publisher alike. Even successful teams can face pressure to move quickly to the next major milestone.

Tencent's strategy, as outlined by Zhu, suggests a willingness to view a studio's development across several games rather than through one all-or-nothing launch. That does not eliminate commercial pressure, nor does it guarantee that every team will be given unlimited time. But it frames creative development as a compounding process: a team's earlier work can create the knowledge, technology, audience relationship, and design confidence needed for a later breakthrough.

"It was multiple Divinities into Baldur's Gate. It was Demon's Souls into Dark Souls into Bloodborne and then finally into Elden Ring, which was so big," Zhu said while explaining the company's long-term view.

Tencent is in a position to point to those developers with unusual proximity. The company holds a significant minority stake in Larian and also has investments connected to FromSoftware's corporate ownership structure. Tencent increased its stake in Kadokawa, FromSoftware's parent company, in 2025, following earlier investment activity involving FromSoftware itself alongside Sony.

Those financial relationships do not mean Tencent created either studio's celebrated games or creative direction. Larian and FromSoftware have each built their reputations through their own development histories. Still, the investments give Tencent direct reason to view the studios as examples of the kind of enduring, creator-led growth it would like to see elsewhere.

Evergreen games provide a different kind of stability

Zhu also drew a contrast between big premium releases and Tencent's large catalog of ongoing live-service games. He described many of Tencent's games as evergreen titles, meaning they are designed to maintain activity and revenue over extended periods rather than relying solely on the sharp peaks surrounding a single launch.

That recurring cadence can offer some insulation from the volatility faced by companies dependent on major releases every few years. A premium game can become an enormous success, but its development cycle creates long stretches of spending before a publisher knows how the market will respond. Live-service operations carry their own risks and require constant support, yet their continued performance can make a portfolio less dependent on one release window.

For Tencent, the apparent goal is not necessarily to choose one model at the expense of the other. The company sees lasting live-service games as a stabilizing foundation while also seeking studios that could eventually deliver landmark premium games. In theory, that combination could give the business room to invest in teams whose biggest opportunity may be years away.

Smaller teams during the riskiest stage

Another part of Zhu's approach involves controlling project scale early in development. He said teams can be kept smaller during the stages where a game carries the most uncertainty, typically concept development and pre-production. Expansion can come later, once the project's direction is clearer and its potential has been more thoroughly tested.

That idea reflects a wider industry conversation about sustainable development. As budgets and team sizes rise, studios can become locked into expensive plans before they have fully validated a game's core mechanics, production demands, or market position. Early experimentation is essential, but it does not always require a massive organization. Smaller groups can prototype quickly, discard weak ideas, and establish a stronger foundation before full production begins.

The industry has also seen many smaller teams deliver outsized successes, proving that creative impact is not solely dictated by headcount. Of course, games on the scale of Baldur's Gate 3 and Elden Ring ultimately require enormous expertise and resources. The point is not that every project should remain small; it is that studios may reduce risk by being selective about when and how they scale.

A difficult backdrop for ambitious plans

Tencent's long-horizon language arrives during a difficult period for game development. Layoffs and closures have affected studios across the world, while investment has become more cautious after years of expansion. Tencent itself has not been untouched by that contraction. The company was reported to have pulled back from multiple studio deals during the year, and it closed TiMi Montreal before the studio released a game.

TiMi Montreal had been led by Ashraf Ismail, the director of Assassin's Creed IV: Black Flag, making its closure a particularly stark illustration of the instability facing even experienced developers. The broader concern is clear: if studios are repeatedly shut down or deprived of the time to build expertise, the industry may struggle to produce future creators with the accumulated experience of Larian, FromSoftware, Remedy, and other established teams.

That tension makes Tencent's stated commitment worth watching. It is easy to praise patient studio-building in principle; maintaining that patience when projects are uncertain, markets are changing, and costs are rising is considerably harder. The real measure will be whether Tencent's teams receive the room to iterate, fail productively, and return with stronger work rather than being judged before their creative identity has fully formed.

Meanwhile, both of Tencent's benchmark studios continue to move forward on their own terms. Following the enormous success of Baldur's Gate 3, Larian has parted ways with Wizards of the Coast and returned to the Divinity universe. FromSoftware has used the reach of Elden Ring to explore projects including Elden Ring Nightreign and The Duskbloods, while signs point to the studio also having another major single-player project in development.

Those next steps reinforce the broader lesson Tencent is highlighting. Major hits can create new possibilities, but they do not replace the value of a studio's identity. Larian and FromSoftware reached their current positions through years of refinement, and Tencent's ambition is to find teams that can follow a similarly durable path--one game, one genre, and one hard-earned improvement at a time.