The foundation to Daydream was created in Sombrero AB, a company focusing on system solutions and hardware sales. Jan Phersson, Erik Phersson and Jorgen Axelsson founded Sombrero AB in 1993. Together with Nigel Papworth, Art Director and Leif Holm, CAD-expert and programmer the group started Daydream Software AB in 1994. Sombrero is a subsidiary to Daydream Ventures AB, which in turn is fully owned by Daydream Software AB. Daydream Ventures AB, was put into liquidation the 21st of February 2003. Many of the employees moved on to found Resolution Interactive AB in the same year, also acquiring the rights to games and project in development at Daydream at the time.