Pathfinder publisher Paizo has announced it is laying off 12 people, after losing close to $2 million in 2025. In a statement on the Paizo website, the company’s CEO Jim Butler explained that the bankruptcy of its distributor has had “devastating” effects for the business.
The statement reveals that $10 million worth of inventory is still held in Diamond Comic Distributor’s warehouse, subject to a legal dispute, while an exclusivity agreement bars the business from quickly finding a new distributor.
Several Paizo employees have shared via social media that they will be losing their jobs. These include editor Lynne Meyer, writer and Pathfinder Society dev Shay Snow, and Starfinder designer Aras Yazgan.
Paizo management is working with the company’s union, United Paizo Workers, to conduct the layoffs of 12 of its workers, giving the union 20 days’ notice of its plans. Following the company’s layoff process, employees will receive a minimum of two weeks’ severance pay, with extra weeks given per years of service, plus 18 months of ‘recall rights’, allowing them to be rehired if conditions improve.
As Paizo is a fairly small business, with Linkedin giving us a (admittedly quite useless) estimate of 50-200 people, these layoffs likely mean the company is losing a significant part of its workforce.
According to Paizo’s statement, one change resulting from this will be reduced support for organized play, the schemes by which Paizo aims to grow its playerbase via in-store/convention play. Future Pathfinder Society and Starfinder Society releases will be cut back to one for each game per month after October 2026.
It seems Paizo will be relying on its community content programs to fill the gaps, with Pathfinder and Starfinder Infinite writers encouraged to produce “sanctioned independent adventure scenarios for use with the current Pathfinder Society and Starfinder Society programs”.
The bankruptcy of Diamond Comic Distributors created enormous fallout in the TTRPG community. If you’ve been following a certain scandal in the Lego community, you might be unusually up to speed on consignment law, but the long and short of it was that Diamond Comic Distributors were paid to store and distribute products on Paizo’s behalf, while the publisher remained the legal owner.
As Wargamer reported last year, Diamond Comic Distributors desired to sell the products from its warehouse and use the proceeds to pay its creditors. Since then, its main lender, JP Morgan, has claimed a lien on the warehouse contents.
Paizo is just one of numerous TTRPG and comic book companies engaged in a legal battle with JP Morgan over ownership rights. Paizo’s statement claims it currently has $10 million worth of inventory still stranded while the courts attempt to untangle the mess.
Butler gives this as a direct reason why Paizo lost $2 million last year, and he adds that a further half a million was lost in sales “covered by the bankruptcy”.
Paizo’s statement ends on a note of hope for the future of its business, with actions like partnering with Independent Publisher’s Group expected to help sales, as well as the upcoming launch of a direct-to-retail program on the Paizo store, which should allow the company to reduce its dependency on independent distributors.
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Source: Wargamer
