Double Fine Survives Xbox Divestment, Launches Kickstarter
Double Fine Productions became independent after being divested by Xbox, laying off 25% of its staff but retaining its IP.
Tim Schafer has explained how Double Fine Productions survived being cut loose by Xbox. The studio founder detailed the process in a September 2026 interview with Bloomberg's Jason Schreier, following Xbox's restructuring efforts this past summer.
Schafer said he sensed the divestment was coming before it was officially announced. He described a defiant reaction from much of the team, framing the challenge as a creative awakening rather than a defeat. "No one puts Double Fine out of business except for me," Schafer told Schreier. He used a metaphor about shooting his own dog to illustrate his point, but concluded the studio would succeed because "a lot of people want to walk the dog."
The Cost of Independence
The transition to full independence required significant cuts. Double Fine was forced to lay off a quarter of its staff. Schafer acknowledged the past year involved soul-sucking struggles, including inner conflict, threats of extermination, and long, strenuous negotiations with lawyers.
Despite the demoralizing process, the studio retained ownership of all its intellectual property. This independence has now led to a new public funding effort.
A New Kickstarter and a Legendary Goal
Double Fine has launched a Kickstarter campaign for its next, unnamed project. The campaign includes a notable stretch goal. Schafer stated that if the fundraiser reaches $100 million, the studio will also develop Brutal Legend 2.
Schafer framed the current situation as a positive creative challenge. He said solving problems like designing a great game for the right budget and finding an interested publisher is soul-enriching work. "Using creativity to solve problems is what gets us up in the morning," he said. The difficulty has reportedly reignited passion within the remaining team.
The Xbox Context and Immediate Fallout
Xbox's divestment of Double Fine was part of broader changes under CEO Asha Sharma, aimed at returning the company to profitability. These changes included layoffs affecting approximately 3,200 employees across the company.
One immediate result of Double Fine's new independence is the end of platform exclusivity for some titles. The studio shadow-dropped Keeper, a game previously exclusive to Xbox platforms, on PlayStation 5 on the day the interview was published.
