David Sears, creative director of South of Midnight, said in a recent interview that he was always worried about the previous era of Xbox's infamous development funding "money tap," and admitted he would probably have turned it off earlier.

The Xbox Game Studios-published South of Midnight launched in 2025, seven years after Compulsion Games' previous game came out. While it enjoyed critical acclaim, it failed commercially. Compulsion split from Xbox this year amid CEO Asha Sharma's "reset" of Microsoft's video game business, which has seen thousands of staff lose their jobs, multiple owned studios go independent, and multiple projects canceled.

In an interview with MinnMax, Sears said he was always worried Microsoft's generous funding of South of Midnight would end. “I literally told people, I was like, 'Wow, this could be terrible,’” he said. “Because somebody is going to say one day, 'You know the money tap? We're closing those floodgates.' And that's going to have really traumatic results downstream.”

Next, he was asked if he’d have turned off the tap earlier himself if he was in charge of Xbox, to which he replied: “Yeah, probably.”

“I wanted to make [South of Midnight], no doubt. Obviously, because we made it,” he continued. “Would I have turned off someone else's money flow before South of Midnight? Yeah, because I'm not completely selfless. But in hindsight at least, it was unsustainable. So, of course it was going to have a shocking outcome."

Microsoft bought Compulsion in mid-2018 as part of a spate of acquisitions designed to bolster subscription service Game Pass' day-one offering under previous gaming boss Phil Spencer.

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