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Following the completion of the anime series "Danganronpa 3: The End of Hope's Peak High School" and the video game Danganronpa V3: Killing Harmony, Danganronpa series writer Kazutaka Kodaka started thinking about how he wanted to create his own development company where he can do new things. He discussed the idea with composer Masafumi Takada and character designer Rui Komatsuzaki, who were also interested in the idea: Takada would be the one to found Too Kyo Games, due to having been involved in the launch of other companies.

Kodaka also invited other people to join the company, including Kotaro Uchikoshi (director and scenario writer of the Zero Escape series), Shimadoriru (Danganronpa illustrator), Takumi Nakazawa (director and co-writer of the Infinity series), and Yoichirou Koizumi (Danganronpa novelist). Kodaka, Takada, Komatsuzaki and Uchikoshi each serve as the core members of the company, with Kodaka serving as both its representative and CEO.

Additionally, the company's name is a wordplay on "Tokyo", where the company is based, and "kyo", the Japanese word for crazy: hence, the company's name literally means "Too Crazy Games".

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