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What is E-sports and how does it work?

Posted Derek Watson
Derek Watson
Derek Watson
E-sports investment opportunities

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What Is FinTech? The Basics

What is E-sports and how does it work?

E-sports, also known as electronic sports, is a rapidly growing industry that involves competitive video gaming at a professional level. From small local tournaments to international competitions with millions of dollars in prize money, E-sports has come a long way in a short period of time. In this article, we’ll dive into the basics of E-sports, its history, current use cases, and what the future has in store for this exciting industry.

The Basics

E-sports involves organized, competitive video gaming between professional players or teams. These competitions can take place online or in physical locations and can range from small, local tournaments to international events with millions of dollars in prize money. Many popular E-sports games are first-person shooters, real-time strategy games, and fighting games, but the genre is constantly evolving as new games are developed.

What it is

E-sports is a competitive video gaming industry that involves professional players or teams competing against each other in organized tournaments. These competitions can range from small, local events to international tournaments with millions of dollars in prize money. Many popular E-sports games are first-person shooters, real-time strategy games, and fighting games, but the genre is constantly evolving as new games are developed.

History

E-sports has a relatively short history compared to traditional sports, but it has grown significantly in popularity in recent years. The first recorded video game competition took place at Stanford University in 1972, where students competed in the game “Spacewar!”. However, it wasn’t until the late 1990s and early 2000s that E-sports started to gain mainstream recognition, with the rise of broadband internet and live streaming platforms. Today, E-sports tournaments are held all over the world and are watched by millions of people online.

Use Cases

E-sports can be used for a variety of purposes, including entertainment, professional competition, and as a tool for teamwork and strategy development. Many companies and organizations have begun using E-sports as a way to engage and attract younger audiences, and it has also been used as a tool for training and team building within businesses.

Breakthroughs

E-sports has made several breakthroughs in recent years, including the establishment of professional leagues and the inclusion of E-sports in major sporting events. In 2018, the International Olympic Committee recognized E-sports as a sport, and it has been included as a demonstration event at the Asian Games. There have also been several major investments in the E-sports industry, with companies such as Amazon and Disney acquiring stakes in professional leagues and teams.

Biggest Companies

There are many companies involved in the E-sports industry, including game developers, tournament organizers, and streaming platforms. Some of the biggest companies in E-sports include:

Activision Blizzard:

Activision Blizzard, Inc. is an American video game holding company based in Santa Monica, California. It was founded in July 2008 through the merger of Activision, Inc. (the publicly traded parent company of Activision Publishing) and Vivendi Games. It is traded on the Nasdaq stock exchange under the ticker symbol ATVI, and since 2015 has been a member of the S&P 500 Index.] Activision Blizzard currently includes five business units: Activision Publishing, Blizzard Entertainment, King, Major League Gaming,] and Activision Blizzard Studios.

Electronic Arts:
Electronic Arts Inc. (EA) is an American video game company headquartered in Redwood City, California. Founded in May 1982 by Apple employee Trip Hawkins, the company was a pioneer of the early home computer game industry and promoted the designers and programmers responsible for its games as “software artists.” EA published numerous games and some productivity software for personal computers, all of which were developed by external individuals or groups until 1987’s Skate or Die!. The company shifted toward internal game studios, often through acquisitions, such as Distinctive Software becoming EA Canada in 1991.

Valve Corporation:

Valve Corporation is an American video game developer, publisher, and digital distribution company headquartered in Bellevue, Washington. It is the developer of the software distribution platform Steam and the franchises Half-Life, Counter-Strike, Portal, Day of Defeat, Team Fortress, Left 4 Dead and Dota.

Valve was founded in 1996 by former Microsoft employees Gabe Newell and Mike Harrington. 

Tencent:
Tencent Games (Chinese: 腾讯游戏; pinyin: Téngxùn Yóuxì) is the video game publishing division of Tencent Interactive Entertainment,] itself a division of Tencent Holdings. It has five internal studio groups, including TiMi Studio Group. Tencent Games was founded in 2003 to focus on online games. In 2021, it launched its international Level Infinite brand, which is stated to be operated from its Singapore office

Riot Games:
Riot Games, Inc. is an American video game developer, publisher and esports tournament organizer based in Los Angeles, California. It was founded in September 2006 by Brandon Beck and Marc Merrill to develop League of Legends and went on to develop several spin-off games and the unrelated first-person shooter game Valorant. In 2011, Riot Games was acquired by Chinese conglomerate Tencent. Riot Games’ publishing arm, Riot Forge, oversees the production of League of Legends spin-offs by other developers. The company worked with Fortiche to release Arcane, a television series based on the League of Legends universe.

The top 5 esports orgs in the world in 2022

Optic gaming

OpTic Gaming

OpTic Gaming climbed over FaZe Clan to take the top spot in Nerd Street’s ranking after winning the Halo World Championship in October and finished the year there. OpTic have been the kings of FPS games in 2022.

OpTic Gaming

FaZe Clan have been neck and neck with OpTic Gaming for most of the second half of the year in Nerd Street’s ranking of the best esports orgs in the world in 2022 .

G2 Esports

It’s hard to think of G2 in 2022 without thinking about their former CEO Carlos “Ocelote” Rodriguez and the fallout from his partying with Andrew Tate, which reportedly cost the org a spot in Riot Game’s premier VALORANT esports circuit in 2023.

Team Liquid

“Always the bridesmaid, never the bride” is an apt descriptor for Team Liquid this year. TL have finished second at major Apex Legends, CS:GO and Rainbow Six tournaments this year: the ALGS Split 2 Playoffs, ESL Pro League Season 16, Blast World Finals and the Jönköping Major.

OpTic Gaming

This Brazilian org has put up strong results in Rainbow Six: Siege, CS:GO, and Apex Legends in 2022. FURIA made the playoffs at the Rainbow Six Invitational and PGL Major Antwerp as the top CS:GO team from the Americas. In Apex Legends, they put up the most points in the finals of the ALGS Championship, ultimately coming in second.

What the Future Has in Store

The future of E-sports looks bright, with a projected growth rate of over 20% annually through 2023. With the increasing mainstream acceptance of E-sports and the continued development of new technologies, we will likely see even more professional leagues and international tournaments in the coming years. There are also plans to include E-sports as a demonstration sport in the 2024 Paris Olympics, which could lead to its full inclusion in future Olympic Games.

Investing in E-sports startups:

One of the biggest reasons to invest in E-sports startups is the industry’s rapid growth and projected continued growth in the coming years. With a projected annual growth rate of over 20% through to 2023 and the increasing mainstream acceptance of E-sports, now is a great time to get in on the ground floor of this exciting industry. Additionally, the global reach of E-sports and the ability to reach younger audiences make it an attractive investment opportunity for companies looking to tap into new markets. The popularity of E-sports is also growing among advertisers and sponsors, as it offers a unique platform for brand exposure to a highly engaged and passionate audience. Investing in an E-sports startup allows companies to not only tap into this growth but also to be a part of shaping the direction of the industry. With the right strategy and a focus on innovation, E-sports startups have the potential to become major players in the entertainment and technology sectors.

In conclusion

E-sports is a rapidly growing industry that has made significant strides in recent years. From small local tournaments to international competitions with millions of dollars in prize money, E-sports has come a long way in a short period of time. With a projected annual growth rate of over 20% through to 2023 and the increasing mainstream acceptance of E-sports, now is a great time to invest in E-sports startups. As the industry continues to evolve and new technologies are developed, we can expect to see even more professional leagues and international tournaments in the coming years.

E-sports startups

If you are an E-sports, there are many potential opportunities for investment from venture capital firms, angel investors, and other potential investors. As E-sports continues to grow and evolve, startups in this space may be attractive to investors looking to invest in companies with promising technologies and business models. As a startup, it may be helpful to actively seek out investors who are knowledgeable and experienced in the E-sports industry and can provide financial support, strategic guidance, and connections. Ultimately, finding the right investors can be a crucial step in helping your E-sports startup succeed and grow.

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