Looks like we might have some more insight into what was the final nail in Telltale's coffin. According to co-founder Dan Connors, the company lost major financial backing due to a company backing out of a project.
"The company was working diligently to close a round of financing. Unfortunately, when the last potential financial backer abruptly pulled out, we were left in a position where we had no choice but to stop production. Sadly everyone was so focused on doing what was required to keep the company going that when the last potential partner backed out, there were no other options."
While Connors didn't say what company pulled out, multiple insiders have pointed to Lionsgate, who invested in Telltale back in 2015. The two were reportedly working on a project that combined Telltale's interactive storytelling with live-action production, but the project never came to fruition, and Lionsgate ended up backing out.