From Fragmented Startups to a €100 Million Powerhouse: How eGames Lab Transformed Portugal’s Gaming Industry

Founded in 2022, eGames Lab emerged as a vital consortium designed to shine a global spotlight on the burgeoning video games industry across Portugal, Madeira, and the Azores. Comprising 22 distinct entities—including 14 commercial organizations, two academic institutions, and six government or trade organizations—the initiative set out to unify a previously disconnected market and build a sustainable economic engine for the region.

Four years into its ambitious mandate, the tangible results of that multi-year effort are beginning to materialize on a national scale. In Funchal, the vibrant capital city of Madeira, a brand-new home for the island’s small but steadily growing games industry now stands as a physical manifestation of the long hours, weeks, and years of work invested by the eGames Lab team in partnership with ACIF-CCIM, the Chamber of Commerce and Industry of Madeira.

This state-of-the-art facility is just one of four specialized hubs being established under the careful guidance of eGames Lab. Together, these locations provide local start-ups and early-stage companies with dedicated spaces to work, collaborate, and learn from one another. They represent critical milestones in the ongoing transformation of Portugal’s video games sector, shifting it from a fragmented collection of passionate indie developers into one of Europe’s most dynamic emerging game development ecosystems.

To reflect on this remarkable journey, the milestones achieved thus far, and the future trajectory of the sector, PocketGamer.biz sat down with Cláudio Telo Pestana, eGames Lab’s project manager.

Painting a Picture: The Pre-2022 Landscape vs. Today

When asked to contrast the Portuguese gaming ecosystem of yesterday with the thriving landscape visible today, Pestana paints a picture of an industry that, despite housing immense potential, lacked structural cohesion. Although it was only a few years ago, the ecosystem was heavily fragmented and underdeveloped, punctuated by only a few notable exceptions.

Prior to the launch of the consortium, a handful of international publishers, such as Miniclip and Saber Interactive, had established offices in Porto, yet there was very little structured support available for local talent or homegrown young studios. Compounding this challenge was an obvious geographic bias that heavily favored the larger metropolitan hubs of Porto and Lisbon, leaving peripheral regions largely out of the conversation.

According to Pestana, the core issue was never a shortage of creative talent or technical capability. Rather, it was the complete absence of a proper support framework capable of nurturing the local games industry, bridging the geographical divides across Portugal’s various regions, and serving as a welcoming point of entry for international companies looking to establish a permanent presence in the country.

The financial metrics highlight the dramatic scope of this transformation. Before 2022, the entire video games industry in Portugal generated roughly €20 million annually. By the end of last year, that economic footprint had surged past the €100 million mark. Today, the country boasts homegrown companies like Redcatpig, based in the Azores, which possess the capability to compete directly on the global stage.

Alongside commercial expansion, engagement between local studios and the broader international industry has flourished through high-profile events. Attendance at DevGAMM Lisbon climbed dramatically from approximately 400 participants in 2022 to over 1,200 attendees at last November’s event. Building on this momentum, organizers have partnered with DevGAMM to establish a dedicated, standalone event tailored specifically for Madeira.

Beyond cultural and creative victories, this rapid growth carries profound implications for the wider Portuguese economy. At a governmental level, policymakers naturally prioritize sustainable job creation and high-value export potential. The success of national enterprises demonstrates the tangible rewards of strategic government investment in video games. For instance, Lisbon-based Infinity Games famously repaid its entire government grant allocation within a single year of operation, serving as a shining testament to the fiscal viability of state-backed initiatives in the creative sector.

Pestana emphasizes that this monumental shift is the result of a collaborative effort involving numerous stakeholders rather than eGames Lab alone. The consortium has worked hand-in-hand with vital industry partners such as the Association of Portuguese Video Game Developers (APVP), with an unwavering government commitment underpinning every phase of development.

Navigating Global Market Shifts and Aligning R&D

The past few years have tested the resilience of the global entertainment industry, marked by widespread market corrections, shifting investment trends, and corporate restructuring across major territories. These global fluctuations have played a surprisingly beneficial role in elevating Portugal’s standing on the international stage.

Pestana attributes Portugal’s rising prominence to a combination of economic realities and structural advantages. Most prominently, mounting financial pressures on established studios—particularly those based in the United States—have made the economics of partnering with Portuguese companies increasingly attractive. As international corporations seek to downsize internal teams and pursue cost-effective co-development partnerships within Europe, nimble and highly skilled Portuguese studios have found themselves uniquely positioned to capitalize on these emerging opportunities.

Equally important is the deliberate alignment between research and development (R&D) and the national startup ecosystem. Building a thriving, resilient games industry requires far more than just gathering talented developers into a single room. From its inception, the mission of eGames Lab has been to think bigger by integrating a diverse array of professional expertise, ranging from technical engineering to academic research.

This philosophy explains why eGames Lab actively incorporates participants from the university sector. In Pestana’s view, R&D and creative expression must go hand in hand. That comprehensive combination is infinitely more compelling to international partners than simply acting as a source of cheap labor that competes purely on price—a strategy that rarely fosters sustainable, long-term strategic relationships.

Looking Ahead: Scaling Up and Unifying the Ecosystem

With the foundational groundwork firmly established, the focus for eGames Lab is pivoting toward future consolidation and expansion. The strategic objective is shifting slightly away from nurturing early-stage companies to becoming exceptionally proficient at supporting the entire scale-up process.

Infrastructure development remains a cornerstone of this next phase. In Lisbon, the consortium is actively collaborating with the APVP and Unicorn Factory, an established innovation incubator that already operates an active workspace in the city. Simultaneously, eGames Lab is establishing similar specialized hubs on Terceira Island in the Azores, in Évora across southern Portugal, and a flagship hub in Funchal on the island of Madeira, which is slated to be the largest of the four physical spaces.

Ultimately, the primary ambition for eGames Lab is to continue doing what it has done since day one: growing the games industry in Portugal as a unified, cohesive ecosystem. By bringing together everyone who shares a passion for games and interactive entertainment, the consortium aims to harness collective talent and opportunity, ensuring that the combined strength of the industry far exceeds the contributions of individual players.

Whether these collaborative efforts continue under the eGames Lab banner or evolve into something entirely new is secondary to the mission itself. The enduring opportunity lies in continuously building robust foundations and creating reliable avenues for people and companies to collaborate, learn, and grow together.

When asked to define ultimate success, Pestana shares a compelling vision for the horizon. He expresses a desire to see one of the supported studios go on to create Portugal’s cultural equivalent of The Witcher—a landmark video game that achieves massive global success while remaining deeply rooted in the unique culture, history, and creative spirit of Portuguese talent. Given the boundless ideas and relentless ambition demonstrated by the professionals he has encountered throughout his journey, Pestana believes that such a milestone is well within reach.