Esports Investments

All sports started as a game between two individuals or teams before evolving as they began to attract spectators and investors. Who would have thought that a couple of youngsters playing video games in front of an audience can be recognized as a type of sport?

esports, as it is called, is increasingly becoming popular with huge investments by brands who intend to sponsor and advertise through the platform like JKR Cyprus or any other offering entertainment investments. As players seek to win millions of dollars in prize money, several investors are looking to take advantage of the massive viewership to generate leads for their businesses. The fact that it brings together people from different demographic groups makes it a good platform for investment.

With attractive monetization opportunities, video game investments continue to rise, driving the growth of the esports market.

Venture Capital Investments in Esports

Venture capital will continue to flow into the industry, seeing that the global esports market is expected to generate over $1 billion this year according to the 2019 NewZoo Global Esports Market Report. This shows how huge the market is and the kind of opportunities that abound for brands that are making considerable cyber sport investments.

The NewZoo reports also revealed that the esports industry investment has continued to rise yearly with the global market expected to exceed $1.5 billion by 2020. With this exceptional growth rate, several sponsors are increasing their video game investments.

You may have also noticed the size of esports viewers worldwide, as it continues to soar. These people stay frequently engaged with a particular game for several hours each week which is greater than what is obtainable in traditional sports. The fact that each viewer can be monetized opens up a channel of revenue generation for those that want to explore the numerous esports investment opportunities.

There is no restriction to viewership as people from any geographic location can stream or play their favorite games from their computers with a live internet connection. This eliminates the discomfort of having to travel to a stadium which is imperative in other traditional sports.

Understanding Revenue Generation in Esports

In esports, a professional team of players often compete in a league or tournament where they work towards winning specified prize money or the championship title. Most game publishers are known to franchise certain leagues where participating teams pay a certain amount of money to maintain their spot and a share in the revenues generated from that league.

Most people are then left wondering how these teams generate enough money to cover their expenses while participating in esports tournaments. Although it is uncommon now, it is believed that teams may start selling contract rights to individual players as seen in traditional sports in no distant time. But for now, here are the key revenue sources for esports teams:

League revenue sharing

After buying a franchise in leagues like Overwatch, the team starts to earn from ticket sales which are a huge source of revenue generation. Revenue from broadcast licensing, advertising, sponsorship, and sale of merchandise by organizers is also shared among individual teams.

Prize Pool

Most teams participate in leagues or tournaments for a share in the total prize pool. Competing teams would try to outmaneuver and defeat each other for a chance to claim the ultimate prize. With millions of dollars that are awarded in esports events like the annual DOTA 2 tournament, teams are guaranteed to go home with huge sums of money.

Sponsorship and Advertising

Most teams are being paid to integrate a brand’s product into the content that is streamed by viewers of the esports events that they participate in. Players also advertise on individual streams as they help create awareness for their sponsor’s brand. The popular sponsors of esports events are Toyota, Intel, HP, and Coca-Cola, among other brands from different industries, including telecommunication and entertainment.

Broadcasting Rights

Teams and players get paid to stream their content on platforms like YouTube and Twitch. A platform with sole-broadcasting rights will be able to attract more active users to its network. Viewers may now have to subscribe or pay a premium for exclusive content. Teams could also get donations from fans which is also an important revenue source.

Merchandise Sales

The sale of team and player branded merchandise to generate revenue is very common in every sport. Esports is not left out as different apparels bearing the team’s logo are sold to fans during certain tournaments.

Benefits of an esports investment fund

With the unparalleled growth that is seen in the esports industry, investment in strategic partnerships will ensure that brands gain access to the tools that are required to drive growth in their sector. Esports investment opportunities abound, making it important for companies to understand the benefits that their funding rounds can offer.

Investors, as well as esports companies which include startups, need to identify partnerships that will be of great value to them. Capital investments from a sponsor would help esports companies to cover all expenses while they grow and actualize their goals. Your company’s credibility tends to grow with the right partnership, thereby attracting more investors.

The fact that most esports companies lack the operational expertise and experience has made partnerships with these investors a great advantage. Partners come up with effective strategies and provide the right connections to take these growing businesses to the next level. These investors do not just provide capital investments but administrative guidance to help companies in the esports industry expand.

Esports Investments that are of Great Value

JKR has asserted itself as a key player in the ever-growing esports industry with significant investments in several projects in various sectors. One example is the strategic partnership with the HellRaisers known for building and managing a team of experienced Counter-Strike players and participating in “The International 2017” after signing the European Dota 2 roster.

WePlay, which organizes several notable esports events in amazing arenas with specifically developed tournament modules is another example. JKR intends to discover and invest in growing digital projects while providing strategic support in the area of technology, finance, operations, and legal matters.

Conclusion

Looking at esports investments in 2019, you will observe that the industry is experiencing rapid growth with advancements in technology. With a large inflow of capital and a massive audience sponsors looking to invest in different aspects of esports would begin to reap rewards in no distant time as monetization strategies are developed.