Esports is a relatively new phenomenon and one that can look geeky and niche from afar. But investors and entrepreneurs say the industry could one day look much like European soccer.
They say that esports, which sees groups of professional gamers competing with each other in major tournaments, will end up dominated by big-name teams and big piles of cash.
Business Insider spoke to Nicolas Maurer, CEO of esports company Team Vitality, whose teams play in “Fortnite”, “FIFA” and “Rocket League” tournaments for prizes of up to $30 million.
We also spoke to Karen McCormick, an investor in esports firm Team Fnatic, which has been likened to Real Madrid.
Click here for more BI Prime stories.
On the face of it, esports and European soccer are hardly similar industries.
The latter is a world-renowned hotbed of international megastars such as Cristiano Ronaldo and Lionel Messi, not to mention a proving ground for would-be superstars such as Christian Pulisic and Joao Felix. Esports, though growing rapidly in popularity, has not yet come close to spawning a star of Ronaldo’s caliber.
But two bullish esports backers say the industry will end up looking remarkably similar to European soccer.
Just as European soccer has become increasingly dominated by 10 to 20 elite clubs, they predict esports will end up the same.
Karen McCormick is the chief investment officer at London-based venture capital firm Beringea, and led its recent investment in London-based esports organization Fnatic as part of its $19 million Series A fundraise in April.
The term “organization” as it’s used in an esports context is analogous to “club” as it’s used in a European soccer context.
Esports organizations comprise multiple teams who specialize in playing specific games. For example, one team could focus on “Fortnite;” another could specialize in “Rainbow Six: Siege;” two teams could focus on “League of Legends,” and so on, and all be part of the same esports club.
Teams vary in size but are often around five-strong, with individual players heralding from anywhere in the world. Teams typically compete in official tournaments focused on one game, such as “League of Legends.”
Though Beringea considered investing in several esports organizations, McCormick saw Fnatic as “best in class.” Fnatic competes in tournaments centered on major titles like “Fortnite”, “FIFA” and “League of Legends” and has been dubbed the “Real Madrid” of esports by the BBC.
McCormick says the emergence of elite esports would be ‘part of the entertainment value’
In 2019, the esports industry is booming, and is expected to be worth $1.5 billion by 2023, according to Business Insider Intelligence estimates. Viewership of esports tournaments is expected rise from 454 million people in 2019 to 646 million in 2023, also per BII. That’s substantial, although by comparison, some 3 billion people watched the World Cup in 2018.
The salaries esports organizations pay their players vary widely, and can depend on the popularity of the game they play. Nevertheless, according to financial news publication The Street, average salaries for players are relatively lucrative, sitting in …read more
Source:: Business Insider