Esports are booming and investors are taking note
It’s no surprise to fans that esports are at an all-time high at the moment…with no signs of slowing down or losing speed at all. In fact, the industry is growing and expanding at a rapid pace. By the end of the year, the industry could be worth more than a billion USD – and that’s an industry that virtually didn’t even exist a few years ago.
The big players are of course the US, China, Japan, but also countries like India and South Korea. In fact, most countries have some sort of stake in things at this point – where previously it was mostly the US and a few Asian countries that dominated the market, teams from all over the world are now competing in the various esports that make this field so interesting.
It’s not just about the games though – as is often the case, money plays a huge factor too. With more and more sponsors and investors trying to grab a slice of the proverbial pie, some of them are getting a little more aggressive in their approach.
“No question this is changing the landscape for media companies and how people are participating in sports,” Tim Seymour, co-founder and managing partner at Triogem Asset Management, a hedge fund, said. “The fan base is rabid,” said Seymour. “The excitement is there. And it’s all demographics. It’s not just guys. It’s not just girls. It’s not just young folks. It’s old folks.”
That’s quite right – even before the Walt Disney Company signed a deal with Blizzard to broadcast their Overwatch League game on a larger-than-ever scale, the appeal of esports had far exceeded its original audience.
“Esports, what makes it so special is that it is a global thing. You can compete anywhere,” said Alex Mendez, an esports commentator and league host for Overwatch. Mendez started out as a footballer and eventually transitioned to games. “And then I just decided: I’m going to transition this into a career. But that’s when everything was so small. Now we’re selling out Barclays Center. That is just mind-blowing.”
In 2017, the global esports economy was estimated to stand at around $696 million, attracting an audience of over 385 million people, according to Newzoo. This figure doesn’t include all of the money that is involved in esports, as investors and the like are left out in the estimate. Year-on-year growth-wise, esports exceeds 40%. This is almost unique to the industry and it means that new investors are constantly looking to get in on the deal.
While originally most esports sponsors were companies related to the field, now all sorts of companies sponsor teams and competitions – from car brands to energy drink manufacturers to fast food chains, just about everyone is in on it.
In fact, bigger investors have largely muscled out smaller ones. With the rapid rate that the sector is growing, it’s no surprise that larger and larger investments are being made. It’s hard to keep up – though it is possible for new names to join the game so to speak. Most recently this happened when India’s first fully-sponsored esports team was formed and officially signed up for competitions – a major milestone indeed.