Let´s start from the beginning, what are eSports? They are videogames (electronic sports) in their competitive facet between players, where their talent and skills, both individual and team, determine the outcome of the matches. It could be defined as the competitive section within the gaming industry, a much wider concept and with a market size superior to the cinema both in Spain and worldwide.
The subset of eSports within the industry is having a spectacular growth in the last years, as it is occupying the place and displacing other established entertainment models, such as cinema or traditional sports. Studies and data of the sector estimate in 2020 a revenue of more than 1,100M$ (15.7% more than the previous period) and an audience of 500M people (11.7% more than 2019).
For further information about the sector data, we have the Newzoo reference.
The sports ecosystem is being formed, investment in new projects is being very significant in terms of growth rates, partly due to the expectations of consolidation, but also due to the paradigm shift in the consumption habits of the new generations (generation Y, generation Z), which are already totally digital, consume on demand, digital social interaction, etc. All these characteristics have been present in sports since its birth.
On the other hand, sports have a technological component intrinsic to their nature (since they are networked videogames) and therefore their scalability comes as standard. Practically all of the projects analysed, from teams, leagues, trackers, scanners, matchmakers, etc., have associated technological elements applied as a means of increasing or obtaining monetization channels parallel to those currently present in the business models (with great weight in sponsorships and advertising).
In Spain we are already seeing relevant movements of clubs and other projects with important financing rounds (Vodafone Giants €3M), or M&A operations (X6tence) although they still do not reach the levels observed in the USA and Asia with rounds of tens of millions of euros. On few occasions to date have there been opportunities to invest in this type of project or startups in a transparent and simple way, they have not offered easy access to the private investor, although many of us already consider investment in these to be very interesting.
In terms of investment, esports projects are certainly a sector with a very high level of expectations (although really achievable) and with a low supply of serious investment companies. In short, an aggressive sector (high risk) and with high potential profits (very high multiples)
For all this, it is very interesting to have some exposure to the sports sector within our investment portfolio, always properly diversified with the main aim of reducing risk and volatility.
How can you invest in esports?
Wygers is a company founded in 2019, whose core business is the world of esports, but it does not focus exclusively on sports, but on a much broader training concept. It has had a high level of professionalization since its birth and has been internationally oriented since its establishment. But it also has the determination to be a company that contributes and joins the lifestyle of the new generations and has a positive social impact on its environment.
In less than a year it has caught up with many of its competitors with many more years of life, jumping into LATAM and incorporating into the management team and society, people capable of driving the movement to another level.
The financing round is open, achieving in less than a day to finance it above 80%, a figure that reflects the interest generated in the sector and in particular of the proposed model. Further information here.
No doubt interesting to at least be evaluated and fit the investment in a responsible way in the portfolio.