How Is The Investment Landscape In Esports?

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How is the investment landscape in Esports?
How is the investment landscape in Esports?

The Esports breakout in the industry of video games and sports has completely revolutionized the economical landscape. Few would imagine that something that was considered as a mere form of entertainment would reach such heights as to be considered a sport and that video game players could turn into actual professional players, making a living out of esports.

Nowadays, the growth of the esports industry keeps a steady rhythm, with a growing number of international tournaments and teams of players that are followed by millions of fans. Esports teams create as much excitement as actual football clubs, and arenas are filled with spectators looking to see the best gamers in action.

The Esports ‘mania’ hasn’t gone unnoticed for many industries looking to open new business ways. Esports fans can now find online betting platforms where they can bet on the biggest esports tournaments listed in the same categories as other traditional sports such as cricket, football, or horse racing. Sports betting is a way of enhancing the audience experience of watching televised sporting events and with the great welcome bonuses offered by platforms such as Asiabet and bettors have even more reasons to try online gambling.

And just as the online gambling industry has targeted esports as a profitable investment, many brands and investors can also benefit from associating with this growing activity.

How can Esports be profitable?

The first thing to understand about the esports industry is that it’s already generating a lot of money. The numbers of audiences that are attracted by the best international tournaments keep growing and the estimated reach in 2021 was 474 million people according to a study released by Newzoo.

The annual growth of esports audiences is around 8.7% and the arrival of online platforms such as Twitch is completely leveling up the game. Streaming platforms, where millions of gamers stream content, are predicted to have such a growth that by 2024 there will be 920 million people watching streams.

Growing audiences means growing investments, as brands can benefit from the exposure to the millions of fans that gather to watch their favorite teams and gamers. Yearly global revenues in the esports industry have already surpassed $1 billion dollars and as much as 75% of these revenues come from sponsorship deals and image rights.

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How do brands invest in Esports?

Sponsorship deals are the focus for brands looking to get into the esports landscape and there are a few preferred types of deals that are pursued.

First, there’s the sponsoring of esports tournaments and events. The most popular games include DOTA 2, Counter-Strike, and League of Legends among others. Every one of these games has different tournaments such as the DOTA 2 International, DOTA Summit, Blast Premier, or the LOL World Tournament. Depending on the size of the tournament, sponsoring packages differ but the range of possibilities is very big as there are many small local tournaments as well as international bouts where you can see brands like KIA or Coca-Cola investing.

Then there’s the sponsoring of esports teams. This is a traditional format of sponsorship where a brand gets the exclusive rights of appearing in a team’s shirt like any other football club has a brand on its shirt.

And finally, there’s a more specific way of sponsoring in the esports industry and it’s the sponsoring of an esports player. In this case, brands look for professional players or even young talents in training set to become the next big stars. In this case, the return of investment can also be very profitable as many professional gamers already boast incredible social media numbers where the brand can be showcased.

Esports for big investors?

And if you’re a business angel looking to invest big money in Esports, know that you can become an investor in many of the biggest teams in the world.

Only in 2021, teams like 100 Thieves raised a 60 million dollars round of investment to help them in their business activities that include esports competitions, merchandising, and apparel.

VSPN a Chinese esports organizer raised 60 million dollars as well in order to help them in their international expansion plans.

Envy Gaming raised 40 million dollars to invest in their esports franchises, and there are many more examples like this.

Esports offers a new horizon of possibilities for investors and it’s expected that the industry keeps growing at the same rate in the next few years.