Fireside Chat, Interview
What's Next for Esports Startups
- The global esports audience is projected to reach approximately 650 million viewers by 2022, assuming a conservative 14% annual growth rate starting in 2017.
- Global revenue is expected to exceed $1 billion within the current year and potentially surpass $1.5 billion by 2021 if growth continues at a 20% annual rate.
- Sponsorship revenue is anticipated to grow at a 30% annual pace, contributing to a potential 3x industry growth over a five-year period.
- Revenue per fan, currently around $4, is expected to eventually close the gap with the ~$50 average seen in top North American traditional sports leagues, though the specific monetization vehicle remains uncertain.
- The future industry structure may involve a fragmentation of games with multiple streamable titles, potentially shifting power dynamics toward team ownership groups and talent if publishers do not maintain dominance.
- Teams are expected to diverge in business models, with some focusing on lifestyle branding and merchandise while others prioritize live events and ticket sales.
- Infrastructure investments in streaming platforms, discovery tools, and engagement technology are expected to drive increased user engagement and monetization.
- Future gaming success is predicted to rely on products combining competitive play, streamability, and user-generated content to create network effects via a business-to-developer-to-consumer model.
- Esports are projected to evolve into a persistent cultural category spanning generations, similar to music, television, and traditional sports.
- The cultural relevance of the sector is expected to become increasingly resilient and integrated into society, with revenue following existing audience attention.
- Skepticism regarding the longevity of video games is anticipated to be overcome as the medium continues its transition to a mainstream phenomenon.