Yes pretty much. Most ISP's just buy access to the cheapest routes which are not always the fastest. I rent servers that are connected to the fastest routes and send the customers game traffic through them. This often results in lowering the latency by a significant amount.
The other thing the VPN does is allows people to choose which region they want to play on. For example, in PUBG, when you launch the game it pings all of the different available regions and selects the one with the lowest latency. This is not always ideal as there may not be any players on the closest servers and you end up playing against a bunch of bots.
I make around $500 per month running a gaming VPN service - [link redacted]
I initially built it to route PUBG players in Australia (myself included!) onto the fastest links to overseas servers as the Australian servers did not have enough players. It was strung together with OpenVPN and a Discord bot as I never expected more than around 20 people would use it... mostly figured it would be me and my squad mates. Within three months I had around 350 users by word of mouth paying $5 per month. Most of my users came from established competitors as my service was a lot simpler to use. The user numbers died down over the following year mostly due to competitors offering an aggressive referral system and I was focused on other projects.
Last year I decided to expand to other games and regions. I rebuilt it as a standalone Electron based Windows app using a kernel network driver that can route individual Windows apps through my WireGuard VPN servers. I built everything except the network driver which was done by a Windows networking specialist - https://ntkernel.com
I currently support PUBG, DOTA 2, iRacing, Apex Legends, Rocket League, Final Fantasy XIV, Super People in Australia/New Zealand and PUBG and Rocket League in North America.
The service is stable and relatively scalable so this year I'm hoping to focus on the marketing in between other projects. Part of that will probably include a name change as I figure it doesn't make a lot of sense to people outside Australia
The other thing the VPN does is allows people to choose which region they want to play on. For example, in PUBG, when you launch the game it pings all of the different available regions and selects the one with the lowest latency. This is not always ideal as there may not be any players on the closest servers and you end up playing against a bunch of bots.