Earlier this summer, Double Fine was at risk of being closed. Now it’s independent again and plowing forward with a $400,000 Kickstarter for its next game jam. If studio founder Tim Schafer is tired of the fight, he’s not showing it. He opened up about leaving Xbox and laid out what’s ahead for the Psychonauts 2 maker in a new interview with Bloomberg. “Some people said: ’I’m checking out, this is one too many battles for me.’ But for the rest of us, it’s like a creative awakening,” Schafer said.
Double Fine, which released the critically acclaimed but poorly selling Keeper in 2025 and the less well-received pottery party game Kiln earlier this year, didn’t escape Xbox’s current reset completely unscathed. It had to lay off 23 people, and Schafer says some initial runway funding from Microsoft won’t last long. But the studio is once again independent and able to chart its own course. That brings with it a tremendous amount of risk, but also a clarifying new level of creative urgency.
“The games industry is full of terrible things, and I can’t change most of them,” Schafer said. “It’s like I’m a captain of a little fishing boat. And it’s like worrying about whether the ocean is fair. Not much I can do about it. Just keep this little boat afloat, keep trying to see if that’s a reef, or is that a bunch of fish? Is that money over there?”
He said being part of Xbox worked for a while, but when new Xbox CEO Asha Sharma came in to replace Phil Spencer, it was clear things were going to change. “We had a mutually beneficial mission, which is just to put great games on Game Pass, and then their mission changed,” Schafer said. “I can’t imagine any amount of profitability—unless we had a breakout, Minecraft hit that year—would’ve saved us.”
While the writing may have been on the wall, Xbox’s decision to divest from Double Fine was an abrupt one. Bloomberg reports that as late as the beginning of the summer, there was still no clarity on what Sharma was planning. Schafer found it hard to get a straight answer from anyone at Xbox, while some stopped responding to his messages altogether. Instead of being bitter, the veteran developer treated it as a moment to rally. He’s currently at PAX West this weekend to help out at Double Fine’s booth.
“No one puts Double Fine out of business except for me,” is one way Schafer explained it to Bloomberg. “Asha’s not going to shoot my dog. I’m going to shoot it. But I’m not going to shoot it because it’s going to do great. A lot of people want to walk the dog.”