The Dark Age of Paradox Interactive: What exactly happened to one of PC gaming's best publishers?

Paradox Interactive once encapsulated the best parts of PC gaming. As a publisher, it celebrated niches like grand strategy and had a huge hand in expanding their popularity into full-blown genres. It took risks on new developers and gave modders the chance to create full-fledged games. There were missteps and mistakes, but from both the publishing and development side the Swedes kept knocking out bangers. 

Penumbra, Mount & Blade, Crusader Kings, Stellaris, Cities: Skylines, Surviving Mars, Magicka, Age of Wonders, BattleTech—its library of games includes an impressive number of all-time greats. The Paradox of 2024, though, seems to be in free fall. 

• Originally slated for 2020, Vampire: The Masquerade – Bloodlines 2 has seen constant delays and a developer switcheroo. It now won't be out until 2025.
• Cities: Skylines 2's first DLC was so poorly received and timed that everyone was refunded and it was added to the base game.
• Millennia landed with a thud, following a similar response to Star Trek: Infinite and Lamplighters League.
• Life By You, the much-touted Sims competitor from Rod Humble and Paradox Tectonic, was delayed and then cancelled right before its early access launch.
• Prison Architect 2 was delayed indefinitely, soon after its original developer was replaced.
• Paradox announced a 90% dip in operating profit in its second quarter of 2024.

While Paradox Development Studio's efforts, including Victoria 3, Crusader Kings 3 and Stellaris, appear to be going strong, when it comes to the publishing side of things it's been a rough year. A rough few years, really. But this is not the first time the company has found itself trying to weather the storm. 

What happened?

When I started covering games some 14 years ago, I found myself writing about Paradox's games because I was one of the few grognardy strategy nerds at my outlet. Paradox was an interesting publisher to cover not just because it created and funded my kind of games, but because it was fairly transparent. The studio heads and CEO Fredrik Wester would openly acknowledge their mistakes and difficulties. And there were a fair few of them. 

Buggy releases were not uncommon. But at the time, this was a small publisher working with small developers, like Mount & Blade creator TaleWorlds Entertainment, a five-person Turkish team founded by a husband and wife. I recall Wester sharing an anecdote about him personally putting manuals in boxes ahead of a game's release—back when PC games still came in boxes.

Even as it grew, though, Paradox never quite managed to shake its reputation for wonky launches. 2011's Magicka, the first game from Helldivers 2 developer Arrowhead, was a big win for Paradox, but launched in a pretty poor state, with broken multiplayer and bugs abound. We gave it 69 in our Magicka review, but its irrepressible charm and creativity turned it into a success—one that I spent plenty of hours with. A year later the beloved Crusader Kings 2 arrived, and it too needed a lot of post-release polish. Crucially, both games were fun and weird and had little in the way of competition, typifying the adage that a flawed but interesting game is better than a boring but polished one. Their commercial success allowed Paradox to put together an internal QA team, as well as giving it the freedom to take the financial hit of a cancellation.

In 2012, it cancelled four games and promised "no more unplayable releases", largely in response to the absolutely dire state that RTS Gettysburg: Armoured Warfare had launched in that spring. Half-baked, incomplete and buggy—it shouldn't have been allowed out the door. Wester's comments at the time mirror what Paradox has been saying more recently about announcing and releasing games too early.

A year later we got Europa Universalis 4, the latest in its flagship series. While Crusader Kings has become Paradox's favourite child, EU4 was still a corker, and tided Paradox over while it had a few misfires. The next couple of years saw the release of Impire, Leviathan: Warships, The Showdown Effect, War of the Vikings, and Cities in Motion 2, and while some garnered fans—I was very fond of War of the Vikings and CiM2, and had some fleeting fun with Leviathan—none of these games really took off. 

This probably sounds familiar to anyone following Paradox today. Bolstered by successes like Magicka, CK2 and EU4, it started throwing money at all sorts of projects, but few of them paid off. Something special, however, was on the horizon. 

Cities: Skylines arrived in 2015. Paradox had worked with Colossal Order before on Cities in Motion, but Skylines was no mere sequel to the Finnish studio's transport sim. It was a full-fledged city builder in the vein of SimCity, which only a few years before had died an embarrassing death. A dearth of urban city builders and disappointment over EA's earlier offering allowed Paradox to swoop in and save the day. It was a massive coup for both publisher and developer. 

Paradox now had some real momentum, and the following years saw it hit the ground running, releasing hit after hit. Hearts of Iron 4, Magicka 2, Pillars of Eternity, Steel Division, BattleTech, Surviving Mars, Age of Wonders: Planetfall, Crusader Kings 3. It was a phenomenal five years. Possibly one of the best runs in PC gaming history. 

This was also when Paradox went public on Nasdaq First North (a European stock exchange for smaller companies), beginning the IPO process in March of 2016. With its coffers full, Paradox was able to splash out on more acquisitions, like BattleTech developer Harebrained Schemes and Age of Wonders developer Triumph Studios. It also purchased Introversion's Prison Architect, though this acquisition was just for the game rights, not the studio. 

During this time, Paradox was really revelling in its success. In 2017, it hosted its first ever public PDXCon. This long-running convention had previously been a media-only affair, but now the paying public could come and meet the teams who created their favourite games. There were talks and panels and tournaments. It felt like Paradox had become an extremely big deal. Fans swarmed developers, treating them like rock stars. After following some of these teams for years, it was a strange thing to witness. 

It wasn't all plain sailing, though. Following Pillars of Eternity, Paradox also published Obsidian's Tyranny in 2016, and it didn't quite stick the landing. Tyranny's approach to RPG morality systems and giving players agency was novel and interesting, but its story ended abruptly, it sold poorly, and after some half-arsed DLC Paradox and Obsidian parted ways, relegating the series to the abyss. Following the break-up, Shams Jorjani, Paradox's VP of business development and now CEO of Arrowhead, told PCGN that it would "love to work with Obsidian" again, but admitted the pair had butted heads a lot during development.

In 2018, Wester stepped down as CEO (he remained on the board of directors), and was replaced by Ebba Ljungerud. After serving on the board for four years, Ljungerud was no stranger to Paradox, but she also came from a very different type of gaming industry: specifically, the gambling industry, where she was COO of online gambling operator Kindred Group.

"It's kind of a gaming industry, but it's a different business model. It's a different proposition," Ljungerud told me when I interviewed her in 2018 for VentureBeat. "I think there are things the industries can learn from each other, but they're still quite different. That’s the whole point of being on a board—you come in with something else, another perspective."

The storm approaches 

Amid this change in leadership another surprise was brewing. Vampire: The Masquerade – Bloodlines 2 was in development. Paradox had acquired White Wolf in 2015, and Hardsuit Labs had pitched Bloodlines 2 shortly after. It wouldn't be until 2019, however, that we'd start to hear about it. Over the years, the original Bloodlines had developed an almost mythical quality. Despite being a catastrophic mess full of bugs, cut features and atrocious combat, it was uniquely fascinating and captured the thrill of being embedded in White Wolf's World of Darkness. Bloodlines launched in 2004, and developer Troika went under the next year, but fans continued to hope for a sequel. 

This was a significant detour for Paradox. It had published RPGs before, but Bloodlines 2 was an altogether more ambitious project "featuring reactive storytelling, fast-paced melee combat, and intriguing characters with their own hidden motives", to quote the original press release. Too ambitious, it turned out. The original 2020 release date was pushed back again and again, until it ended up in 2021. And then Hardsuit Labs was given the boot. 

I assumed that was it done. In 2018, Ljungerud had told me that one of the things she wanted to change about Paradox was deciding when it should cut its losses on a game. The same thing Wester had said all the way back in 2013. Certainly, what had been shown publicly did not inspire confidence. I recall, during PDXCon 2019, press were shown 'new' footage of the game, which ended up effectively being a redo of the original gameplay reveal, and frankly it looked dire. I didn't think it was long for this world. But now in 2024, it has a new developer in The Chinese Room, a brilliant studio with no RPG experience. 

If it hadn't been for The Chinese Room's pitch, Bloodlines 2 would probably have been done for. "If we hadn't found The Chinese Room," deputy CEO Mattias Lilja told me in a recent interview, "and seen what they'd done with the early work, [cancellation] would have been the next logical step, because we could not continue as we did."

Still, the developer was an unusual choice. Lilja said it was seeing work The Chinese Room hadn't shown off publicly, as well as the project it was working on at the time, which would become Still Wakes the Deep, that convinced Paradox it was right for the job.

"They have a capacity for this type of more constrained but narrative-driven games that we liked," Lilja said. "We gave them the work that Hardsuit Labs had done, and we said, this is the vision, and this is the work done so far. You need to own it. What do you want to do with it? And we're actually quite impressed by what they came back with."

Along with a new developer we got a new 2024 release window. It didn't last for long, though. In August it was pushed back to the first half of 2025 "to add more endings to the game", along with some extra polish.

It's clear that Paradox isn't a confident RPG publisher. It's not a genre it's used to, even though it had success with Pillars of Eternity. It's no surprise, then, that it's largely done with big RPGs. "It is not in our strategic direction to make this kind of game," Lilja said. "So if Bloodlines 2, God willing, is successful, Bloodlines 3 [will be] done by someone else, on the licence from us. I would say it's the sort of strategic way this would work. So it's still an outlier from what we're supposed to do, we don't know that stuff, so we should probably let other people do it."

During Paradox's wonky handling of Bloodlines 2, its core still seemed stalwart. 2019's Imperator: Rome, despite taking a bit of a bashing on Steam, reviewed well and surpassed the publisher's expectations in regards to sales. In 2020, we finally got Crusader Kings 3, arguably the greatest game released by Paradox Development Studio. "It's an irrepressible story engine that spits out a constant stream of compelling alt-histories, delightfully infuriating characters and social puzzles that I've become obsessed with unravelling," I said four years ago, and I still adore it. Its latest expansion, Roads to Power, exemplifies what makes the series so special—that strange but brilliant meshing of strategy and roleplaying, where you can command armies and conquer nations, or simply wander the world getting into hijinks and punching nobles.   

After Paradox's previous big success story, Cities: Skylines, we got a flurry of cracking games. A new era for Paradox, where it was growing into one of PC gaming's most influential companies. Following CK3, though, things have been significantly rockier.  

Romero Games' Empire of Sin had all the ingredients of a great Mafia sim, but it was fundamentally broken. I was amazed that even Paradox, which frequently pushes out games that need more time in QA, released it in the state it was in. Surviving the Aftermath was a middling follow-up to Surviving Mars from a different studio. Star Trek: Infinite was like a Stellaris-lite with a Star Trek coating, and half a year after launch Paradox announced that it would receive no more updates, with no further explanations. Millennia was a rough Civ-like with some interesting ideas that did little to tackle Civ's flaws. The Lamplighters League received lacklustre reviews, sold poorly and resulted in layoffs at Harebrained Schemes, which ultimately culminated in a breakup.

It would be wrong to characterise this period as one exclusively of failures, though. The long-awaited Victoria 3 took a bit of a kicking on Steam, initially, but sold extremely well and got strong reviews. Age of Wonders 4, meanwhile, proved to be a high point for the series and let me create an empire full of tyrannical frogs and undead cannibal rats. Both continue to be supported by Paradox.

But this small number of well-received releases were not enough to shield Paradox from the disaster that was Cities: Skylines 2. We still managed to find a lot to like about Colossal Order's sequel when it arrived, but this was in spite of a bevy of issues. The lack of modding tools at launch, the huge performance issues, the fact that Colossal Order inexplicably targeted 30 fps on PC, the weird terrain quirks, the broken economy—it was rough. 

Colossal Order churned out plenty of patches, but then managed to infuriate players all over again when, this year, it launched the game's first DLC: a beach-themed asset pack with no new features and, crucially, no actual beaches. It was so poorly received that Colossal Order and Paradox had to issue an apology, dish out refunds and make the DLC free.

"I think the lesson learned is that we should probably not launch that early," Lilja told me when I asked him how Paradox would approach things differently, given the chance. "There were parts of the Cities 2 launch that I am not proud of. I am happy with how we responded to the feedback from the fans, just like we did with Victoria 3. We didn't exactly hit what we wanted, but we're working with the fans to remedy that over time."

We still had Life By You, at least. Just like Cities: Skylines usurping SimCity's throne, maybe Life By You could do the same with The Sims. EA had been without any real competition for decades—now it was time to shake things up. And with former CEO of Second Life developer Linden Lab and head of EA's The Sims label running the show, no less. After multiple delays, Life By You was heading to early access on June 4. Then, a mere two weeks before it was due, Paradox delayed it again. This time indefinitely. 

A few weeks later, Life By You was cancelled, and Paradox Tectonic, its 24-person studio, was closed down. In a statement, Lilja explained that the publisher had lost confidence in the project. "Though a time extension was an option, once we took that pause to get a wider view of the game, it became clear to us that the road leading to a release that we felt confident about was far too long and uncertain."

While Paradox's leadership had expressed a desire to get better at cancelling projects that weren't working over the years, this pivot felt extreme. Life By You was on the cusp of launching in early access. It had gone through several delays already. A former member of the team described it as having "the rug pulled" from under them.

Designer Willem Delventhal painted the game's final days as ones where the team was outperforming the "internal metric", and where the game was doing "extremely well". And then, "two weeks before launch, we were told we wouldn't be launching". He also alleges that the team only found out about the cancellation via the public announcement.

Lilja, however, believed that Paradox had run out of options. "We looked at all the options," He told me. "That's why we took a pause first, and then, I think, a month and a bit later, we cancelled it. We spent a month trying to [figure out] how do we do this? What are the options? And we didn't really see any, so that's why we ended up there. It doesn't mean that we'll never get back to it or do something similar, but we don't have options that allow us to do that now."

The main problem was that it was trying to compete with The Sims, but simply couldn't. "We saw a lot of issues with this feature, the graphics, that this thing is glitchy, that doesn't quite work," chief creative officer Henrik Fåhraeus told me. "Eventually we just saw that this is not in any way… no single thing here is actually better."

Given this, it's understandable that fans of Prison Architect might be worried about the fate of its sequel. Following a delay that saw it pushed back to early September, Paradox has now delayed it again, this time indefinitely, echoing the situation with Life By You. "Over the next few months, we will focus on improving the game and building a more robust release timeline," the blog post read. "This also means we will be limiting our communication with you all until we have a timeline we feel comfortable with."

Paradox contends, however, that unlike Life By You, Prison Architect 2 is still completely salvageable. "It's a fun game," said Fåhraeus, "and it's been fun for quite a while, but it's rough. It has a rough UI. It's a little unclear why things are happening. It crashes. So it needs that love."

Prison Architect 2's rocky road to release also included a developer switch, which only happened back in May. Double Eleven, which had been working on the series even before Paradox purchased it in 2019, left the sequel mid-development because "we could not find a commercial agreement that worked for both parties moving forward and mutually agreed to part ways". The current developer, Kokku, had previously worked on 3D artwork for Horizon Forbidden West's weapons and robots as well as porting Golf Club Wasteland.

Environmental hazards 

This tumultuous era also coincided with revelations about the environment in which these games are made. In September 2021, Ljungerud resigned as CEO citing "differing views on the company's strategy going forward". She was replaced by her predecessor, Wester. Less than two weeks later, Wester apologised for an incident in 2018 where he was responsible for "inappropriate behaviour" with an employee. 

"Beginning of 2018, we held a company-wide conference, and during this gathering, a Paradox employee was subject to inappropriate behavior from me personally," Wester tweeted. "This was something I immediately and sincerely apologized for in person the following Monday in a process reviewed by HR."

This admission came in the wake of a leaked internal survey where the majority of women working at Paradox Interactive (at least among those who participated in the survey) reported mistreatment. "Offensive treatment is a systematic and far too common problem at Paradox," read the conclusion of the report, adding "There is a perception that perpetrators at managerial level are protected by the company."

Ljungerud, who was still CEO at the time of the survey, resigned only a few hours after its findings were presented to the rest of the company. Paradox denied there was any connection, despite the proximity of events. Similarly, it denied that Wester's resignation in 2018 was connected to his conduct. 

The previous year, Rock Paper Shotgun published a report about Paradox's QA staff, with allegations of "poor treatment, low pay and mismanaged layoffs". Paradox's publishing QA department was closed down in 2019, and the former and (then) current employees RPS spoke with described a lack of transparency, poor communication, and being offered "worse jobs as a replacement for their lost positions within QA". 

Paradox employees eventually signed a collective agreement with unions, and Paradox also brought in an "external, neutral company to conduct a thorough review of our processes". That company was Gender Balance, and its findings were published in February 2022. 

The report found that cases of severe or overt harassment or sexual harassment were fewer than expected for a company of Paradox's size, but it still uncovered notable issues. "Cases of grey zone abusive behavior," it read, "which may defy clear legal definitions but nevertheless impacts the victim, is significantly more common. Women are significantly more likely to be targeted than men, but men also experience it."

Several women reported having to advertise the fact that they were in a relationship or put up "a harsh facade" to avoid unwanted advances from male colleagues, and the 16 cases handled by Paradox's HR department between 2016 and 2021 suggested an environment where employees didn't feel comfortable making complaints. Paradox called the report "a first step for us to really address these issues and bridge the trust gap that exists".

In April 2024, Paradox published the findings of a new survey, following up on the report from Gender Balance, though it had a lower response rate than previous surveys. It found that "among the seven protected grounds of discrimination, sex remained the most reported and has slightly increased in rate and absolute numbers compared to the previous years". 14% of women and 1% of men reported experiencing sex-based misconduct. Bullying and victimisation rates increased, but scenarios where a manager was the perpetrator, as reported by women, were down from 11% to 3%. 

While there have been some improvements, the survey found that there was "persistent gender disparities in workplace misconduct, with both improvements and areas requiring further attention in the coming year". Anonymous reviews on Glassdoor (where employees can review their employer) currently give Paradox a 53% approval rating, while Wester as CEO has a 67% approval rating. The bulk of criticisms are around senior management and salary. 

"Now we have mandatory training for everybody," Lilja told me, "so that everybody can understand what these things are, see what they consist of, how to detect them, and what to do if they detect them, and then we train the managers more because we want the managers to handle the situation. This has had an effect. We can see that people feel more safe, and of course, this is not something that's gonna maybe ever go away fully, but the gap has shrunk between men and women, and both have higher confidence that Paradox is handling these kinds of things well. But we know it's not a one-off thing. So the training is mandatory, and training is what Gender Balance also recommended as the main effort." 

The future of Paradox 

One trend with Paradox is that it often struggles with growth. Its core games, from Paradox Development Studio, typically perform well, but when it takes risks on new studios and experiments with genres outside of its comfort zone it frequently misses the mark. There have been multiple times during the publisher's long history where it expressed a desire to focus on that core, usually following issues when it deviated from it. When Wester returned as CEO he said the same thing. We're yet to really see that pay off, however, and probably won't until the arrival of Europa Universalis 5, which hasn't officially been announced but we know is absolutely coming. 

"We have had pretty bad discipline when it comes to investments, in the sense that we take on quite a lot of risk in areas, maybe where we're not so strong," said Lilja. "Which is sort of the definition of a bad idea. So we're not going to do that [any more]."

Lilja acknowledged that this is history repeating itself. "We have solved this problem before, and then we sort of forgot. But I think essentially the solution is what we did back then. We refocused on the core. We stopped talking about stuff before it was ready to be talked about." One difference, though, and perhaps this is what will allow Paradox to stick with the strategy, is the existence of Paradox Arc, which serves as a smaller, experimental publishing label. It's already produced a bunch of interesting games, like Stardeus.

"[Paradox Arc] takes on some of those riskier, cooler things that we want to do," said Lilja, "but in a small sense, and also branded differently. PDS and Paradox Interactive come with expectations, and Arc helps us say, 'this is experimental territory'. We often do early access there as well, just to even push harder, like, you know what you're getting into."

Even so, investing in the core and producing small experiments hasn't always panned out. Millennia, Star Trek: Infinite, Empire of Sin, Cities: Skylines 2—each of them are games in genres Paradox knows. That it released Empire and Cities 2 in their states is particularly damning, given that even a cursory glance would have revealed how far from ready they were.

Paradox could have afforded to take the hit and delay them. Should its earlier successes not have afforded it more flexibility? They certainly should have spent more time in the QA process—while it was scrapped in 2019, a new QA department took its place, working with third-party QA teams and in-house QA teams for Paradox's first-party games. The problem is that Paradox has a specific way of doing things, and that's fixing stuff after the game goes live. 

Take Cities 2, for instance. Paradox and Colossal Order were aware of the issues, but "we were actually in agreement that iterating this live was probably the right way to go," said Lilja. And that often works out. But this time it didn't, because players already had a game that was overflowing with features and mods, and had a lot more polish. So they just went back to Cities 1. 

There is at least some acknowledgement that it can't keep doing this, and that Paradox learned the wrong lessons from some of its rough but successful games. "I actually think the success of Magicka might have confused us a little bit," said Fåhraeus. 

"Yeah," added Lilja, "Magicka taught us the wrong things. It was that technical stability doesn't matter. Yeah, it was fun. Yeah, people don't care if it's unstable. NASA has a term: they call it a 'near miss'. It's when the space shuttle that did not blow up really should have. So people learn that you don't have to be so careful."

Maybe it's learned its learned the right lessons now. To not release games so early, like it did with Cities 2, or to not take huge risks on games it's never tried before, instead using Arc "to find ways of exploring without betting the farm". Lilja also wants to stop announcing games too early because "that's unnecessary." The desire to build hype is understandable, but when you look at Bloodlines 2, which started taking preorders five whole years ago, it starts to look a bit silly.  

One thing I can't shake, though, is how a lot of Paradox's troubles started around the same time as the IPO. I am predisposed to not trusting shareholders because their single goal is to keep making money out of their investment, and that means constant growth. It's not enough for a company to keep making good games, they need to make more of them, and then more on top of that, increasing shareholder value. Success in capitalism is all about getting bigger and bigger, but that's not necessarily an environment that produces quality games. 

Did the shareholders exert pressure on Paradox? Did those investments encourage Paradox to make the big swings and big mistakes it's still currently dealing with? Lilja doesn't think so. 

"We were successful and got slightly more confident," he said. "I don't think it has to do with the investors, because they were the same people before and after this. The investment firm Spiltan, they were way earlier than the IPO. And Fredrik Wester is still the biggest owner, and he was that way before the IPO."

Paradox's three biggest shareholders are CEO Fredrik Wester, who owns 33.36% of Paradox, Investment Aktiebolaget Spiltan, which owns 16.86%, and Tencent, with a 10.07% share.

"So certain things changed with the IPO perception-wise, also internally with staff," he continued. "So there were pros and cons of that, but I think where we had challenges with discipline or were slightly overconfident, I think [that comes more from us] doing great as a business. I would say that the IPO was a result of us being successful. Before that, we grew a lot up to the point of the IPO as well. So the growth journey had been part of this all the time. The IPO happened in the middle, and they coincided. So I would challenge you on that a bit. It's not the main thing that I see. It's more that we had quite a lot of money, and we felt smart, and we wanted to do cool stuff. Success has its own challenges, and we have started to rein that in. You don't see it because game development takes a long time, of course. So some changes have already happened. Arc has been launched. We're prototyping longer. We are investing in our core."

If Paradox is able to stick with its strategy to focus on the games it knows, maybe it could turn the tide. At least the transparency seems to be returning. So much of the trouble at Paradox kicked off during the height of the pandemic, which also resulted in a bit of a communication breakdown—for a while the company seemed more insular. But the candid way Lilja has been speaking about its recent difficulties is reassuring, even if it is in part to mitigate some of the bad press it's been receiving over the last year or so.

What's clear is that it would be a mistake to count Paradox out. While it seems to be bouncing between cancellations and delays and rough launches like an out of control pinball, it's been here before. The stakes have never been this high, and the problems have never been this high profile, but it's got a proven track record of weathering storms. Or maybe I'm just being incredibly optimistic because I crave a supply of quality grand strategy games.