If you’re still sceptical about potential appeal of staging live video-game tournaments in packed out arenas, figures released by eSports business Gfinity may force you to re-assess.
In the company’s maiden results since its IPO (which raised £3.5m) on the Aim market last December, Gfinity, which hosts online competitions as well as live events, revealed an increase in its registered user base from 43,000 to 300,000 between 30 June and 31 December 2014.
Revenue ballooned 791 per cent to £145,401 compared to £16,303 at the same time a year earlier.
In the six months ended 31 December 2014, Gfinity staged its first live event and the UK’s largest ever eSports event at the Queen Elizabeth Olympic Park in London, attracting a record crowd of 4,000 ticket paying spectators and drawing in 8.7m online views.
Staging such events does not come free, however, and the company racked up an operating loss of £1.4m, compared with a loss of £583,996 a year earlier.
Since then Gfinity has signed a collaboration agreement with Vue Cinema to open the UK’s first eSports arena - which hosts its first event this weekend - and has recorded “strong continued growth in registered users”.
If Gfinity has successfully shown off the widespread interest and attraction of eSports, its challenge now is to draw in increased sponsors and advertisers to offset its operating costs.
Why it’s interesting
Gfinity’s results reveal both the incredible opportunity eSports can offer investors and some of the financing challenges faced by companies in the industry.
Although popular around the world, eSports is still an emerging industry in the UK, something reflected in Gfinity’s expenses in maximising its user base, expanding the size of its online community and enhancing its reputation for live events.
In its results, the company cites a report from international market research firm which states total eSports revenue could surpass $1bn (£680m) in a couple of years.
Whether potential sponsors will buy that remains to be seen, and Gfinity admit that there is “an education process to go through with a number of sponsors, who haven’t engaged with the sector before and are only now starting to appreciate its potential”.
What Gfinity said
The immediate key goal remains to establish Gfinity as the leading ‘go-to’ destination for spectators and competitive players of electronic games. Having established a significant first mover advantage Gfinity is well positioned to exploit the rapid worldwide growth in eSports, and its increasing transition into a spectator sport.In the longer term there is a large opportunity through its eSports events and widening audiences to draw in sponsors, advertisers and broadcasters who want access to a highly defined and targeted demographic of 18 - 34 year olds, predominantly male, that play and watch eSports.
eSports is booming, and Gfinity looks perfectly set take off from its explosion in the UK.