I see it all the time. A founder comes to me, eyes wide with excitement, pitching their new game. They’ve got the latest AI buzzwords down. They talk about procedural content generation, dynamic NPCs, and AI-driven storytelling. They show me demos of impressive tech. But then I ask them one simple question: “What’s the game?”
And that’s where it all falls apart.
They don’t have a game. They have a tech demo. They’ve fallen into the same trap that I see so many founders fall into: they think that AI is a replacement for good game design. They think that if they just throw enough AI at a project, a great game will magically emerge.
They’re wrong. And it’s a costly mistake.
I’ve been in the trenches of the tech world for a long time. I’ve had two successful exits, RemoteTeam and MovieLaLa. I’ve invested in over 200 companies, including some of the biggest names in AI like Anthropic, OpenAI, and Scale AI. I’ve seen what works and what doesn’t. And I can tell you this: most founders are getting AI in game development completely wrong.
They’re wasting their time, their money, and their talent on the wrong things. They’re chasing the hype instead of focusing on what really matters: making a great game that people want to play.
In this article, I’m going to break down the biggest mistakes I see founders making when it comes to AI in game development. And I’m going to give you a new way to think about AI that will help you avoid these pitfalls and actually use AI to make better games.
The Siren Song of the “Shiny Object”
A few months ago, a young founder pitched me his game. It was a sprawling open-world RPG with a complex, branching narrative. He told me that the entire world was procedurally generated by an AI, and that every NPC had a unique personality and backstory generated by a large language model. He had a demo, and it was impressive. The world was beautiful and the NPCs were surprisingly coherent.
But then I asked him about the gameplay. What did the player actually do in this world? What were the core mechanics? What was the story about? He couldn’t give me a clear answer. He was so focused on the tech that he had forgotten to design a game.
This is what I call the “shiny object” syndrome. Founders get so enamored with the latest AI tools and technologies that they lose sight of the bigger picture. They think that if they just use the newest, most powerful AI, they’ll be successful. But the truth is, the tools don’t matter as much as you think. A great game can be made with simple tools, and a bad game can be made with the most advanced AI in the world.
Don’t get me wrong, I’m a huge believer in the power of AI. I’ve invested in some of the most cutting-edge AI companies on the planet. But I also know that AI is just a tool. It’s not a magic wand. It can’t turn a bad idea into a good one.
The Myth of the AI “Magic Wand”
Another common mistake I see is the belief that AI can just “create a great game” on its own. Founders think that they can just feed a bunch of data into an AI and it will spit out a fully-formed, ready-to-play game. This is a dangerous fantasy.
AI is not a replacement for human creativity. It’s a tool for augmenting it. The best AI-powered games are not created by AI alone. They are created by talented designers, artists, and writers who use AI to help them realize their vision.
Think of it like this: a writer can use a word processor to write a novel, but the word processor doesn’t write the novel for them. It just makes the process of writing easier and more efficient. The same is true for AI in game development. AI can help you with things like level design, character creation, and even storytelling, but it can’t do the creative work for you.
You still need a strong vision. You still need to understand the principles of good game design. You still need to have a story to tell. AI can help you with the “how,” but it can’t give you the “what” or the “why.”
Don’t Forget the “Boring” Stuff
When I was building RemoteTeam, we used AI to help us with a lot of things, from customer support to marketing. But the most important AI we built was the one that nobody ever saw. It was a system that analyzed our data and helped us make better decisions about our product. It wasn’t sexy, but it was incredibly valuable.
This is the “boring” stuff that so many founders ignore. They’re so focused on the flashy, user-facing AI that they forget about the underlying infrastructure and data that makes it all possible. They don’t want to do the hard work of collecting and cleaning data. They don’t want to build the pipelines and the APIs. They just want to plug in an AI and watch the magic happen.
But it doesn’t work that way. If you want to build a successful AI-powered game, you need to be willing to do the boring stuff. You need to be willing to get your hands dirty with data. You need to be willing to build a solid foundation for your AI to stand on.
The “Cyborg” Approach: Augmenting Human Creativity
So, what’s the right way to think about AI in game development? I call it the “cyborg” approach. A cyborg is a being with both organic and biomechatronic body parts. It’s a fusion of human and machine. And that’s exactly how you should think about AI in game development.
Your goal should not be to replace human creativity with AI. Your goal should be to augment it. You should use AI to do the things that humans are bad at, so that humans can focus on the things they are good at.
For example, you can use AI to generate a thousand different variations of a sword, but you still need a human artist to choose the one that looks the best. You can use AI to generate a branching dialogue tree, but you still need a human writer to make sure the story is compelling.
The cyborg approach is about finding the right balance between human and machine. It’s about using AI to enhance your own creativity, not to replace it. It’s about building a team of humans and AIs who work together to create something that neither could create on their own.
Stop Chasing Ghosts
I’m not going to lie to you. Building a successful AI-powered game is hard. It’s really hard. There are no shortcuts. There are no magic wands. But if you’re willing to do the work, and if you’re willing to think about AI in the right way, it is possible.
So, stop chasing the shiny objects. Stop believing in the myth of the AI magic wand. And for the love of God, don’t forget the boring stuff. Instead, embrace the cyborg approach. Use AI to augment your own creativity. And focus on what really matters: making a great game that people want to play.
If you can do that, you’ll be well on your way to success. And who knows, maybe one day you’ll be the one with two successful exits and a portfolio of 200+ angel investments. But you’ll never get there if you’re chasing ghosts.
The Investment That Taught Me Everything
I remember one of the first AI gaming companies I invested in. Let's call them 'Project Chimera'. Their tech was brilliant. They had developed a system that could generate entire game levels on the fly, complete with enemies, quests, and even a semblance of a story. On paper, it was the holy grail of game development. I was blown away by the demo and wrote a check on the spot. It was one of my bigger early-stage bets - a little over $500,000.
For the first year, things looked great. They hit all their technical milestones. The AI got smarter, the worlds it generated more complex. But then they tried to turn it into a product. And they couldn't. The 'game' was a mile wide and an inch deep. The quests were repetitive, the enemies predictable, the story nonsensical. It was a technical marvel, but it wasn't fun.
They spent another year trying to bolt on a game design. They hired writers and designers, but it was too late. The core of the product was the AI, and the AI wasn't built to create a compelling experience. It was built to generate content. The company eventually pivoted to selling their tech as a B2B tool for other game studios and had a modest exit, but they never achieved their grand vision. I got my money back, but it was a painful lesson. Technology, no matter how impressive, is a servant to the user experience, not the other way around.
The Cyborg in Practice: Real-World Examples
So what does the 'cyborg' approach actually look like? It's not about some far-off sci-fi future. It's happening right now. Here are a few concrete examples of how smart developers are using AI to augment their creativity:
AI-Assisted Animation: Animating characters is incredibly time-consuming. Instead of hand-animating every single movement, studios are using AI to generate procedural animations. An artist defines the key poses and the character's personality, and the AI fills in the gaps, creating fluid, realistic motion that can adapt to different environments. The animator becomes a director, guiding the AI's performance, rather than a manual laborer.
Smart Asset Generation: Think about the sheer number of assets in a modern game. Trees, rocks, buildings, weapons... it's endless. Instead of having artists create every single one from scratch, they can create a set of rules and parameters and let an AI generate thousands of variations. The artist then curates the best ones, ensuring they fit the game's aesthetic. This frees up the artist to focus on the unique, hero assets that really define the look and feel of the game.
Intelligent Playtesting: How do you know if your game is balanced? Or if there are any game-breaking bugs? Traditionally, you'd rely on a team of human QA testers. But now, you can use AI to do the heavy lifting. You can train an AI to play your game thousands of times, exploring every possible path and strategy. It can identify exploits, balance issues, and bugs that a human tester might never find. This doesn't replace human testers – you still need their qualitative feedback – but it makes the process infinitely more efficient.
In all these examples, the AI isn't the star of the show. It's a powerful assistant, a tireless intern that handles the grunt work, freeing up the human creators to focus on what they do best: being creative, making strategic decisions, and injecting the soul into the game.
Where We're Actually Headed
Forget the hype about AI writing perfect scripts or designing entire games. That's a distraction. The real revolution in AI for gaming is quieter, more technical, and far more impactful. Over the next five years, the biggest changes won't be in the content itself, but in the process of creating it.
I predict we'll see a massive shift towards what I call 'generative workflows'. The entire pipeline of game development, from concept to launch, will be infused with AI. Your game engine will become an active collaborator. Imagine sketching a level layout on a tablet and having the AI instantly build a 3D prototype, already populated with placeholder assets and basic scripting. Imagine writing a character bio and having the AI generate a model, rig it, and suggest a dozen different voice options.
This isn't about replacing developers. It's about giving them superpowers. It will allow smaller teams to create games on a scale that was previously only possible for AAA studios. The barrier to entry for creating massive, complex worlds will plummet. The bottleneck will no longer be the sheer manpower of asset creation, but the quality and originality of the creative vision.
But here's the contrarian take: this will also lead to a massive flood of mediocre content. When everyone has a content-generating machine, the value of mere content drops to zero. The games that succeed won't be the ones with the most content, but the ones with the most meaning. The ones with a unique voice, a compelling story, and a deep understanding of player psychology. The human element will become more important than ever.
Your Game Is a Business, Not a Science Project
At the end of the day, you have to remember that you're not just building a game. You're building a business. And the goal of a business is to create value for customers. In the case of a game, that value is entertainment.
Is your AI making the game more fun? Is it creating a more engaging experience? Is it helping you tell a better story? If the answer to any of these questions is no, then you're using it wrong. It doesn't matter how cool your tech is. It doesn't matter how many buzzwords you can cram into your pitch deck. If you're not making a great game, you're going to fail.
So, my challenge to you is this: take a hard look at your project. Are you building a game, or are you building a tech demo? Are you using AI as a crutch, or are you using it as a tool to augment your own creativity? Be honest with yourself. Your success depends on it.
Stop chasing the ghosts of AI hype. Start building a real, tangible, and most importantly, fun game. That's the only thing that matters.
Frequently Asked Questions
What's the most common pushback you get on this?
People often push back by citing exceptions or edge cases. And they're usually right that exceptions exist. But building a strategy around exceptions rather than patterns is a losing game for most founders.
Do all experts agree with this view?
No, and that's fine. The best ideas in business are often contrarian. I share my perspective based on my experience and data, but I encourage you to seek out opposing viewpoints and form your own conclusions.
How can I apply this thinking to my own situation?
Start by identifying the core principle behind the opinion, not the specific example. Then ask yourself: does this principle apply to my context? If yes, test it in a small, low-risk way before going all in.
How has this view evolved over time?
My thinking on most topics has changed significantly over the years. Early in my career, I held many conventional views that experience proved wrong. I try to update my beliefs when the evidence changes.