Louis Castle's InstantAction has closed operations just three months since its high-risk Facebook-meets-Guitar Hero game launched to market.
The Oregon-based company has been emptied of nearly 30 staff.
Its browser 3D engine, Torque, has been put up for sale – a move unfortunately timed as fellow engine vendor Emergent is also seeking a buyer for its popular Gamebryo engine.
Director of operations Alex Reid admitted that the group found difficulty in returning a profit in recent times.
Several workers had been chipped away from InstantAction in recent weeks as the firm began to buckle under the financial pressures, leading to a mass-redundancy round this week with the remaining 24 staff handed their notice.
Last week pay for the final 24 staff was honoured, according to local newspaper the Oregonian.
The studio’s final game, InstantJam, was demonstrated at E3 as plastic guitar title that sought the sweet-spot between the virility of Facebook games and the popularity of music titles.
“Today, InstantAction informed employees that it will be winding down operations,” manager Eric Preisz said in a statement.
“While we are shutting down the InstantAction.com website and InstantJam game, Torquepowered.com will continue to operate while InstantAction explores opportunities with potential buyers for Torque.”
InstantAction’s CEO Louis Castle, the former VP of creative development at EA, has not publicly commented on the company’s failure.
At this year’s Develop conference he claimed that all games must be free to sample and discover, and proposed that while the traditional console and PC gaming industry will continue to exist, it has to take on more of the business ecosystem of the casual industry.
InstantAction began life under the name GarageGames before its acquisition by holding company IAC/InterActiveCorp in 2007.