Web-based party games are making a comeback, and startups like Little Umbrella are leading the charge by infusing generative AI into their social games. The company has announced a $2 million seed funding round, which will be used to expedite the launch of three AI-powered social games set to be released in the coming year.

The resurgence of social games is evident, particularly within online communities like Discord. These games are appealing to players and their friends because they are quick to play and primarily depend on group dynamics for enjoyment. Notable examples include Jackbox Games, which has attracted millions of players with its core focus on party video games. In 2021 alone, players reportedly participated in over 72.2 million games.

Little Umbrella believes it can differentiate itself by using AI to develop games more rapidly than ever before. The startup's flagship title, Death by AI, quickly became a hit after its launch last year, attracting over 20 million players within the first three months. The game's success is not surprising, given its hilarious premise: players are challenged to create deadly scenarios and observe how they and their friends would react. Utilizing generative AI, the game evaluates whether a player succeeds or fails, allowing each player five attempts before they are eliminated.

Death by AI is available for free on Discord, the web, and iOS, and can be played by up to eight players. The company is set to launch its new party game, tentatively titled The Last Show by AI, which is described as a dystopian game show hosted by sinister AI game masters. In the game, players must survive while voting their friends out in the process. A beta version is planned for launch during the 2025 Game Developers Conference in March.

The use of generative AI tools in video game development has seen a significant rise, enabling developers to create ambitious games with minimal effort and reducing costs in the process. Little Umbrella claims that it was able to develop and launch Death by AI in just ten weeks, a stark contrast to Jackbox Games' nearly annual schedule.

The startup has developed a cross-platform social game kit called Playroom, which powers Death by AI and its upcoming projects. This kit includes an AI orchestration layer that utilizes multiple custom models in partnership with ElevenLabs, Inworld, and OpenAI. Playroom is currently available to all video game developers and costs between $10 and $150 per month, depending on the size of the team, with a free version also available.

Little Umbrella's leadership team is comprised of industry veterans, including CEO Tabish Ahmed, who was formerly the design leader at Meta's Horizon Worlds. Ahmed recognized the opportunity to create social experiences on platforms like Discord, where friends already interact, but noted that cross-platform development poses significant challenges for studios, leading to a gap between demand and content availability.

"At Little Umbrella, we've embraced this challenge by creating platform-agnostic social games that are built and maintained at a fraction of the cost using AI, designed specifically for where players gather with their friends, bridging the gaps in both demand and scalability," Ahmed told TechCrunch.

The team also includes Timothy Johnson (CTO), who previously worked at Gallium Studios building AI-simulated worlds, and Sean Webster (CBO), former AppLovin vice president and head of partnerships at Snap. Additionally, Little Umbrella's art director, Bill Robison, has contributed his skills to popular titles like "Boss Baby," "Scoob!," and "Young Jedi Adventures."

Investors who participated in the latest round include a16z speedrun, Breakpoint Ventures, Disrupt.com, GFR Fund, Ubiquoss Investment, Virtual Reality Fund, and Workplay Ventures (Mark Pincus's VC firm), along with angel investors Matt Bilbey (former Electronic Arts exec) and Flexport founder Ryan Peterson.

With its $2 million seed funding and innovative approach to social party games, Little Umbrella is poised to make a significant impact in the gaming industry. As the company continues to develop and launch new games, it will be interesting to see how its AI-powered approach shapes the future of social gaming.