The meteoric growth of Esports has many investors seeing it as a strong, growing industry with countless investing possibilities. And if projections are anything to go by, the game has only just begun.
N0tail, JerAx and ana are not household names like Roger Federer or LeBron James. Unless you live in a household of esports enthusiasts that is. In case you do, you would know that the three of them combined have made over $19 Million by playing competitive video games. Needless to say, esports is now an industry worthy of serious attention.
Globally, the esports industry has been on the rise, with competitive video gamers leading the way. Just like their counterparts in other sports like football or basketball, gamers compete across a wide variety of video games. And the parallels with traditional sports structure doesn’t end there. In 2020, the esports audience grew to 496 million. But, what are half a billion esports followers watching?
While the gaming industry churns out a multitude of games each year, not all of them allow players to compete against one another. The esports industry is centred around games that offer an element of competitive gameplay. These could be sports games like FIFA or NBA2K, or even more action-oriented games like Fortnite and League of Legends. Over the last few years, there has been an active effort to position and market esports in the same way as traditional sports. Which means it has its own stars, teams and sponsors.
Many skilled players stream their games on platforms like YouTube or Twitch to a large viewership, which brings opportunities to earn money. Others join teams and play for considerable rewards all over the world. Fans engage with players through social media, by watching and commenting on live streams of their gameplay or by attending tournaments. Apart from fans, the ecosystem surrounding the esports industry includes gaming events, technology and analytics platforms, services and significant investment. And it continues to grow despite COVID-19’s impact.
The esports habitat
As mentioned, the ecosystem of esports consists of several key players. No pun intended.
A good team consists of great players. But that’s only one part of the picture. Teams with sound business models, significant marketing and a competitive streak tend to draw investors and create revenue through partnerships, sponsorships, licensing and cash prizes at tournaments.