Esports organizations come in all shapes and sizes. Some are passion projects forged out of the success of an esports veteran. Others were the result of former sports star investing millions into jumping into the very top echelon of the industry. For digital marketplace Kinguin , however, fielding professional esports teams is part of a larger gaming brand. The Esports Observer spoke with Kinguin’s CEO and founder Viktor Wanli about his company’s role in the industry, how esports impacts Kinguin, and how teams can improve their business models.

Kinguin has been involved in esports for years, both as a sponsor and a competitive team. Over time, the company moved away from sponsoring events to focus on building its team.

“We believe that owning a team supports the development of the esports ecosystem more directly than just sponsoring events” Wanli said. “We want to be able to interact with the community directly through our team and encourage improvements in all organizations.”

[perfectpullquote align=”right” cite=”” link=”” color=”” class=”” size=””]“We have to balance following trends and keeping up with the fans with making sustainable business decisions that help us thrive.”[/perfectpullquote]

Today, Team Kinguin fields teams in Counter Strike: Global Offensive and the up-and-coming esports phenomenon Fortnite . The organization has secured sponsorships with Razer, apparel brand Hummel, and its official nutrition partner Runtime.

Wanli points to the way Kinguin has handled its entrance into Fortnite as a prime example of the way his organization handles its operations. Like Team Kinguin, many esports organizations have jumped into Fortnite during the early stages of its esports scene, but Wanli says that organizations need to be intelligent in how they follow gaming trends:

“Esports is always evolving with new games and genres popping up all the time, unlike what we see in traditional sports, where we’re certain there won’t be another baseball or another basketball. For us, as an esports organization, it is important to create a sustainable ecosystem and solid foundation to be able to react when the audience latches on to something new. “We have to balance following trends and keeping up with the fans with making sustainable business decisions that help us thrive. For Team Kinguin, that means having a physical training space with a solid ecommerce and operational backing, so that we can fully support new esports trends that we feel contribute to the overall esports ecosystem.”

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Training facilities—rather than the traditional esports model of team houses where players live and practice—have become a growing trend among esports organizations, particularly for organizations like Team Liquid and Counter Logic Gaming that compete in the North American League of Legends Championship Series . Kinguin is taking this idea a step further, developing a space that is available for use by both its teams and other organizations, as well.

Like the team itself, Wanli sees the Kinguin Esports Performance Center as another way to connect with the esports community. “Providing a professional training center and having a team allows us to work directly with the community and give back for all their support,” he said.

For Wanli, operating an esports organization is about finding the balance between taking large risks, like opening a sharable performance center, and making safe, intelligent business decisions. “Esports is ready for big investment and international stages,” he said. “So a lot of people decide to make their entry into the business by going very, very big. But it’s equally valid to start smaller and grow.”

He added, “As esports is still learning and growing, there is flexibility in how team organizations can be structured, and what works for us at Kinguin may not work for another team, but I believe we have the right balance of different sources of revenue that make our organization sustainable.”

Wanli identified the key revenue streams for an esports organization as:

Sponsorship deals (“the biggest revenue stream”)

Prize money.

Personal player revenue from streaming and content creation.

To secure big sponsorship deals and win prize money, a team usually needs to win. However, Wanli believes that there is room within esports for organizations to carve out a niche even if they are not at the top of their respective games.

“Not everyone can be an international top team and not everything in esports is about making lots of money. There is plenty of room for organizations that are more focused on the community and building a solid team rather than one that is only focused on winning. For us working hard for the team, contributing to the development of the esports ecosystem in Poland, giving Polish gamers an opportunity to be on an international stage, and have a great team spirit is what matters at the end of the day.”

If you’d be interested in hearing more trade secrets from Viktor when it comes to the business model of esports organizations, be sure to join us at the RSR Partners x HIVE esports business conference, on September 28th!