You lost your Internet connexion last week? Some ninjas kidnapped you to obtain confidential information from you? This press review is for you! Catch up news business which have marked this week. For this new issue, our Press Round Up talks about investments done by professional sports clubs, the takeover of Oxent by Webedia and the millionaire Mark Cuban delaying his entry on the market.
Esport, just a craze or a real opportunity?
This year 2016 stamps the interest of sports clubs in electronic sport. These two last weeks have seen a wave of investments from sports clubs on the market. Never seen! Here is a small overview:
- September 26th: The basketball team of Philadelphia 76ers becomes the first North-American professional sports team to own an esport team. For this, the club redeems the team Dignitas and Apex, which will ensure them to be present in several championships of which the professional league of League of Legends. Scott O’Neil, CEO at 76ers explains: “Its undeniable that Esports is a mean for the American companies to reach the millennial on a new way, what balls and bats sports can’t.”
- September 27th: The success of Team Liquid has attracted some big investors’ interest. But it’s the aXiomatic Group which handles a part of Team Liquid. Steve Arhancet and Victor Goossens remain the team’s heads as co-CEO of Team Liquid but both will work in conjunction with Peter Guber and Ted Leonsis, co-CEO of the esport division of the aXiomatic Group. “With our new group of owners heading the adventure, I’m sure that we can grow up from a top-team to a real powerhouse in sports and entertainment” explains Arhancet.
- September 28th: Within the NBA, the potential of esport is the topic right now. Stephen Kaplan, co-owner of the Memphis Grizzlies, has made his club beginning the third franchise of the North-American Basketball League to invest on this growing market segment. Stephen Kaplan is an investment expert and one of the funders of the Oak Tree Capital Group. He already owned shares in the team The Immortals which plays in the professional league of League of Legends. On September the 28th, Stephen Kaplan increased his shares to begin the Immortals’ majority shareholder.
- October 2nd: Steve Aoki, the famous DJ and music producer, announced while he was performing live at the TwitchCon, his involvement with the Rogue team established last May by Frank Villareal. Aoki becomes co-owner of the team and will be in charge of the brand building. In a press release, the musician stated: “I’m finally able to step up my love for the game by beginning a Rogue’s owner, a professional team which I share the same ambitions with.”
- October 4th: The Paris Saint-Germain establishes an esport division supported in this by the Webedia Group. By becoming the first French sports club to engage in the area, the Paris Saint-Germain wishes to develop its brand internationally. The PSG will assign to Webedia the use of its trademark for its digital development; more information to come from October the 20th.
- October 5th: The Asvel (Tony Parker’s Basketball club based in Lyon-Villeurbanne) claims its interest in esport. Since 2015, the Asvel has been a partner of the Lyon esport and is one of the pioneers of the sports clubs in France. So the team takes its time but ensures to remain up to date with the market to better enter it and build its brand later on.
- October 6th : Sevilla Fútbol Club, Villarreal CF, Real Aviles C.F., Real Sociedad, Real Zaragoza, and Real Sporting de Gijón. Six Spanish football clubs have claimed within the week their wish to develop an esport division. An announcement should be made at the Barcelona Games World Convention. According to the esportsobserver.com website, a Spanish esport league could emerge. Therefore numerous professional clubs are riding this notoriety, putting esports under the spotlights. Is it a trend or an actual opportunity for these clubs?
SmartCast’s eye:
If we think about in terms of supply and demand, the takeover of an esport team for a sports club is a good opportunity. Indeed, by entering the esport market, professional clubs can ride a growing ecosystem. Much more than just an investment, this diversification allows the professional clubs to reach a new audience target and reinforces their notoriety. By increasing/expanding its supply, a club therefore develop its digital trademark and also internationally. Nevertheless, the swiftness with which clubs undertake these investments is questionable. The bubble effect is more and more challenging.
Mark Cuban believes that the esport market still too fickle.
Mark Cuban, the Dallas Mavericks’ owner, often expressed his interest for esport, notably with a funding of $7 million in the online bet platform Esport Unikrn in 2015, after he saw plenty of investors such as Shaquille, O’Neal, Rick Fox. Mark Cuban has spoken about a potential investment with Ethan Chiel. He explains that he “doesn’t close the door“, but this is not the topic of the moment yet. “I’m worrying to see how fast the players are breaking down […] I know that the teams are trying to do more and more but the amount of hours involved remains a concern for me.“
