FaZe Clan Goes Public On NASDAQ Following $725m SPAC
Last year, the executives behind FaZe Clan announced their intention to go public with the brand, touting a $1 billion valuation of the company. It was a bold statement, and it would have cemented FaZe Clan as a certified trailblazer in the market, but it seemed for a while that the deal wouldn’t ever go through. In Q1 of 2022, the opening deadline was missed on the key merger deal, but on the 20th of July, after a relatively short delay, FaZe Clan went public, being listed on the NASDAQ.
This marks a milestone for both the brand and for the esports industry in general. Now, FaZe Clan, known on the NASDAQ exchange as FaZe Holdings Inc., is the first organisation of its kind to land on the exchange. While the original valuation of $1 billion was thrown out the window, a SPAC deal worth a very respectable $725m was eventually settled on.
Find out in full what this means for FaZe Clan and the esports industry.
Forging The Future of FaZe
While FaZe Clan has a collective following of around 500 million users and is the fourth most valuable esports organisation, there are concerns around this deal. It’s a huge step for the esports industry, and of course for FaZe Clan, but typically, SPAC deals perform quite poorly for investors. When FaZe Holdings Plc. opened on the NASDAQ, it was with a valuation of $13 per share. At the time of writing this article, that number has dropped to around $9 per share.
Since 2020, FaZe Clan’s overall valuation has risen by approximately 31%, according to Forbes. There’s a long list of top-rated, talented players and content creators under the FaZe umbrella, and in many different esports titles, the organisation boasts world championship standard teams. As the esports industry grows exponentially in terms of value and overall popularity, companies like FaZe Clan will undoubtedly be leading the charge.
In a statement, Lee Trink, CEO of FaZe Clan, said:
As this generation rises to economic power and influence, FaZe will continue to use its voice to pioneer and innovate at the intersection of technology, entertainment and culture. We thank our partners at B. Riley and look forward to engaging with our shareholders. FaZe Up!
Reportedly, out of the entirety of FaZe Clan’s audience, approximately 80% is made up of 13 to 34-year-olds. It makes for a trickier future when it comes to public investment, but there are already signs of the die-hard fans that support the brand stepping up to buy shares.
According to Tobias Seck, a Business Analyst with the Esports Observer, this may just be an attempt at securing capital. It’s no secret that the global economy is in a relatively rocky patch, and despite the growth of esports in general, many organisations struggle to remain profitable – if they manage to do so at all.
But, with that being said, there’s plenty in store for FaZe Clan. As an organisation that competes in some of the top esports tournaments in the business, there’s a steady income made up of prize pools, merchandising, and sponsorship deals. Outside of competing, FaZe Clan has made waves in the last year, such as at the tail end of 2021, when the firm partnered with DraftKings, a key sports and esports betting operator.
Ultimately, this is something of an experiment for FaZe Clan and the wider esports community. Should this prove successful, other organisations may follow in the footsteps of FaZe.