Earlier this month, we learned that the entire staff at Stray and Neon White publisher Annapurna Interactive had resigned following a dispute with boss Megan Ellison. While it was reported by Bloomberg as a disagreement over attempts to “split the video game division into an independent entity,” details were still scant. A new report from IGN's Rebekah Valentine sheds more light on the strike, which reportedly involved “disagreements over the management of the Interactive division, chaotic departures, miscommunications, and a perceived lack of leadership transparency.” It's a comprehensive account of some of the more complicated events that I recommend you read in full, but here's a quick summary.
Tensions were already present before 2024, IGN wrote. Views of Ellison at Annapurna Interactive “ranged from indifference to latent distrust, given reports of his behavior toward previous employees,” and anonymous sources noted “fear of retaliation from Ellison, especially given his resources, background, and reach.”
Still, IGN reports that business at Annapurna Interactive was “business as usual” until mid-March of this year. That's when employees were “suddenly” informed that co-founder and Annapurna Pictures CEO James Masi had been fired, leading to a scuffle that extended to Annapurna chairman Nathan Gary. Annapurna claims that Ellison “reinstated Gary as head of Interactive and deemed Masi's role redundant.” However, Gary also left the company around the same time. From the report:
Sources say employees were told by leadership at Annapurna Interactive in the days that Gary had been fired along with Masi. The belief that two of its leaders had been fired seemingly out of the blue has led to confusion and anger, with a handful of people, including at least one other Interactive leader, resigning in protest.
Ellison later did a video call and stated that “all of the staff who had left, including Gary and Masi, have returned and discussions have begun for a possible spin-off of the company.” The plan was for Gary and Annapurna Interactive staff to form a new company called Verset that would oversee the Interactive projects currently in existence. The developers IGN spoke to were aware of the plans and “received assurances that their contracts would be honored.”
Verset was to be the “independent arm of the company,” with former Sony producer Hector Sanchez leading AAA and AA projects. This included “transmedia properties” — hence the recently announced Remedy deals. But a lack of internal communication about these plans left employees feeling “confused, anxious, and frustrated about the direction of the company and the future of the Interactive division, with or without Verset.”
Around this time, IGN reported, “Talks with Ellison about the spin-off appeared to have stalled, and in August, Annapurna officially ended talks.” In a statement to IGN, Annapurna said, “Any insinuation that Annapurna has backed out of the deal is false. We agreed to high-level deal terms and signed a stipulation in early April, which makes it all the more surprising that we've never heard back.”
Multiple sources told IGN that in the months leading up to the strike, “Ellison began to have more say over Annapurna Interactive's deals, projects, and budgets, which made them even more uncomfortable about the direction the company was heading.”
In late August, 25 of the company's employees—including Gary, Masi, and the rest of the leadership—signed a joint resignation letter, giving two weeks' notice before leaving the company on September 6. This left Ellison, Sanchez, and CSO Paul Doyle “to work in a similar vein to Annapurna's gaming efforts.” IGN wrote that despite the two-week notice, the co-developers were not informed of the impending resignations. From the report:
Annapurna Interactive sources say they received no guidance from the company at the time on who should notify developers, when, or how. An Annapurna spokesperson reached out to IGN after the news broke, denying this and claiming they had active and open conversations with Interactive staff about how to communicate the news.
As it stands, IGN says Annapurna is “split into two groups, both working to pick up the pieces.” On one side, there are 25 departing staff who make up the remnants of Annapurna Interactive (“or perhaps a future Verset”), and on the other, there is a “small leadership team” at Annapurna to support “around 40 projects.” An Annapurna spokesperson shared the following statement with IGN:
The whole situation is confusing, but we’re focused on moving forward now. We’ve had some really great conversations with the overwhelming majority of our current development teams and are grateful for their partnership. If our inbox is any indication, a ton of developers want to be a part of what we’re building, and we look forward to seeing their pitches. We’ve also received a lot of quality job applications and are excited to build a team that is passionate about our mission to tell original stories that aren’t being told anywhere else. Note: We’re hiring.
But we are hiring!