Polyarc spent almost 12 years making Quill, a small robot mouse, one of virtual reality’s most recognizable characters. On September 11, the Seattle studio announced on LinkedIn that it’s winding down active development entirely — the final step in a shutdown that started with a mass layoff back in March.

From Bungie alumni to VR’s biggest breakout hit

Polyarc was founded in 2015 by a group of former Bungie developers and self-published its debut game, Moss, on PlayStation VR in 2018. The action-adventure puzzler became one of the platform’s best-reviewed exclusives and helped make the case that VR could support more than tech demos and shooting galleries. The studio followed it with Moss: Book II in 2022, then spent the next several years working on a larger, unannounced project alongside smaller VR support work.

This July, with that bigger project already dead, Polyarc shipped Moss: The Forgotten Relic — a remaster combining the original Moss, Book II, and the Twilight Garden DLC into one package and, notably, the first time the series was playable outside of a VR headset. It arrived across multiple platforms as effectively a farewell tour for the studio’s flagship IP, though nothing about the launch was billed that way at the time.

A layoff in March foreshadowed the end

The shutdown didn’t come out of nowhere. On March 31, Polyarc laid off roughly 30 people — about two-thirds of its staff, leaving the studio at around 15 employees. The company said the cuts followed an unsuccessful, team-wide effort to find funding for a large project after that project lost its financial backing in December 2025, mid-development. A third-party publisher reportedly made a late attempt to secure alternative funding to keep the project alive; that effort also fell through. Polyarc never disclosed what the project actually was, and it still hasn’t.

The remaining skeleton crew spent the following months finishing and shipping Moss: The Forgotten Relic rather than starting anything new. With that release out the door and no replacement project or funding in place, Tuesday’s announcement made the studio’s exit official rather than surprising anyone who’d been tracking its finances since spring.

What the closure means for VR’s remaining first-party talent

Polyarc’s shutdown is a blow to an already thin bench of studios still betting on premium, narrative-driven VR titles rather than treating the format as a side platform for ports and minigame collections. Moss proved a VR game could carry real emotional stakes and win over players who’d never touch a headset otherwise, and its success helped justify continued investment in PSVR software during a period when many publishers were pulling back. Losing the studio behind it removes one of the format’s few remaining first-party success stories at a moment when PlayStation has already been retreating from ambitious live-service and experimental bets elsewhere in its lineup.

It’s also another data point in a now-familiar pattern: a mid-size studio loses funding on an unannounced project, quietly cuts most of its staff, finishes what it can with a skeleton crew, and closes for good a few months later. Polyarc’s statement thanked its former staff and the players who supported Moss over the years, but offered no detail on severance, what becomes of the studio’s IP, or whether Quill’s story is truly finished.

What’s next

There’s no word yet on who, if anyone, ends up holding the rights to Moss going forward, or whether any of Polyarc’s former developers have landed at other studios. For now, a series that spent nearly a decade arguing VR was worth taking seriously has run out of runway alongside the studio that made it.

For more on how thin the ground has gotten for ambitious, non-live-service projects this year, see our coverage of PlayStation’s live-service strategy collapse and the industry’s record profits paired with record layoffs.