Founder Spotlight: How Neon is putting players and developers at the center of gaming

Apple and Google’s app store dominance is coming to an end. At a recent Founder Spotlight event, Chris Faught told Renegade Partners Co-founder and Managing Director Roseanne Wincek how Neon is empowering game developers to bypass the existing monopolies and sell directly to players.

Depending on who you ask, founders should either build in an industry they love or be strategic and seize an emerging opportunity. Neon’s Chris Faught is doing both.

Growing up in Western Pennsylvania, Chris was an avid gamer, drawn in by how games bring people together and tell compelling stories. After graduating from business school, he worked in payments, first at Affirm, where he led work with companies including Walmart and Shopify, and later at Apple, on the Apple Pay team.

“I became obsessed with the concept of building payment networks, inspired by what companies like PayPal and Square had achieved,” says Chris. “To me, it was always about creating tools that bring buyers and sellers closer together.”

The market for general-purpose retail and ecommerce payment networks is incredibly crowded, and Chris began to think about alternatives for specific verticals. His opportunity came when a series of high-profile lawsuits challenged the dominance of the app store model.

For years, Apple and Google have maintained a stranglehold on mobile game developers, taking 15-30% of every dollar their users spend in app. When Fortnite-maker Epic Games successfully sued both of them, their global monopolies began to crumble. During its trial, Apple said it would allow developers to set up their own out-of-app purchase channels, as long as they could figure it out and cover the costs.

“For us, that was the opportunity: building a payment network to help game studios set up their own ecommerce channels,” says Chris.

A direct-to-consumer alternative for game studios

Neon lets game developers run their own webshops, selling digital products directly to players without paying the 30% platform tax. The white-labeled, fully branded storefronts integrate seamlessly with a studio’s existing systems and handle everything under the hood.

“Players can make purchases directly, and we ensure smooth operations, notifying developers of the transaction, processing payments, and fulfilling the item in-game,” says Chris.

Neon works with a range of studios, from a small husband-and-wife team to large developers. Prior to working with Neon, many of their games were monetized entirely through in-app purchases, rather than ads or subscriptions, meaning Apple and Google took a 30% cut of all revenue generated.

“We charge closer to 10%, so the savings can add up significantly for developers,” says Chris. “The larger the studio, the more impactful those savings become.

”Neon’s key success metric is ‘mix shift’, the amount of revenue a studio moves from app stores to a direct channel and over what period of time. The results so far have been promising.

“Some of our larger partners have successfully transitioned a meaningful portion of their revenue, and it’s sticking,” says Chris. “They typically drive anywhere from 10-35% of total revenue through their Neon-powered webshop, and average order values are 2-4 times higher than in-app purchases.”

But the real opportunity isn’t cutting costs. It’s changing the dynamics of the gaming industry. For the past 40 years, studios have been suppliers to large platforms who have managed the relationships with players and owned all the data, including emails and purchasing interactions. First, those platforms were console makers like Nintendo, Sega, and Sony, with Apple and Google joining later as mobile gaming took off. Neon’s mission is to empower studios to break free of that model and own their relationship with their players directly.

“By connecting studios with players, we’re helping them build stronger, more sustainable businesses in an industry that’s rapidly evolving,” says Chris.

Chris admits the technical challenge of building Neon was bigger than expected, especially allowing its developers in 45 markets to accept payments from their global consumer bases.

“Until recently, the enabling payment and fintech infrastructure to build a platform like this simply didn’t exist,” he says. “But now we’re creating a system that even small studios could use if they wanted to explore out-of-app payments.”

Chris believes Neon’s success changing the dynamics of the gaming industry will hinge on how well it can help developers build trust with players.

“It’s the core currency for platforms like Apple and Google,” he says. “They’ve spent loads of money over the years on marketing campaigns centered on privacy, trust, and security.”

Trust is also important for studios that want to move off-platform.

“The complexity of going independent makes it unlikely they’ll succeed alone,” says Chris. “The key question becomes: which partners can they trust to support the transition?”

Neon’s next stage of growth

Growth at Neon has been rapid. In the last five months, the company’s total processing volume has increased by 100x. To capitalize on this, Neon recently closed a $14 million round from investors including Renegade Partners, Thrive Capital, a16z Speedrun, Griffin Gaming Partners, SciFi VC, and Ribbit Capital.

As a first-time founder, the challenge for Chris was finding partners who appreciated the significance of Neon’s mission, but were able to act as sparring partners along the way.

“Renegade stood out early on through their willingness to go deep and form a perspective on what we’re doing,” he says. “We’re at a tender, nascent stage, so having a partner who has taken the time to build their own conviction and challenge us on our assumptions is critical.”

Neon is currently a team of ten people with deep fintech, gaming, and ecommerce experience, having built products at companies including Meta, Roblox, and Walmart. The goal is to double headcount over the next three months while accelerating investment in product and go-to-market.

“We’ve done no marketing at all until now, and the response has been really encouraging,” says Chris.

Beyond scaling operations, Neon’s next big milestone is becoming publicly available. The company is currently handpicking customers to ensure it can build a scalable product capable of operating globally and at the volume that big publishers expect.

“For some of these companies, we’re talking about hundreds of millions of dollars, so we need to make sure we don’t collapse under that kind of weight,” says Chris. “We’re still in the early days, but I believe we’re on the right path.”

At Renegade, we’re backing similar companies that are redefining their industries. If you’re building something interesting, we’d love to hear from you.