A third of staff are at risk of losing their jobs at Velan Studios, the company behind Mario Kart Live: Home Circuit and shutdown dodgeball game Knockout City.

Velan Studios announced the likelihood of layoffs in a statement from the company’s founders, Guha and Karthik Bala, who said that 46 people out of the team’s current total of 121 had been given notice their positions may be impacted.

In the statement, posted to social media platform X, the founders blamed a “major project” being “suddenly cancelled by an external partner, which means we may not be able to maintain our full studio size”.

Mario Kart Live: Home Circuit was a physical toy version of Nintendo’s series, where you could create real-life racetracks around your living room.

The company will now reorganise its staff to refocus around several current, unannounced projects set to launch later in 2024, while hunting for new partnerships to minimise the impact of layoffs.

“This is a rough environment for a lot of indie studios, and like them, we are faced with some very hard choices,” the statement said. “We hope to rescind as many notifications as possible.”

Based in New York state, Velan Studios was set up in 2016 by Guha and Karthik Bala, the brothers who previously founded Vicarious Visions and grew that studio as it was acquired by Activision, subsequently found fame for developing Skylanders, before it was folded into Blizzard’s Diablo development arm.

Velan Studios’ most recent release was Hot Wheels: Rift Rally, which launched for PlayStation consoles and smartphones last year.

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