Mentioned in this article Teams: Fnatic Games: League of Legends

The European-based esports organisation Fnatic just recently announced an Indiegogo campaign to produce own gaming peripherals. This move comes after the acquisition of Func Inc, a hardware company based in Sweden. We sat down with Fnatic CEO Wouter Sleijffers to talk about the campaign, the general strategic goals of his brand and also asked why EU is not able to match the salaries of NA.

Why did you choose to make an Indiegogo campaign?

We decided to introduce Fnatic Gear as an Indiegogo campaign for two reasons. First, it helps us to fund the production of the initial product line. Indiegogo allows us to accelerate the launch of first Fnatic Gear products into the market and get the first products out before the festive season. Secondly, the campaign raises awareness for Fnatic Gear and also invites the community to become actively involved in improving our products. We have opened up the possibility to enlist yourself as a Fnatic Gear Beta Tester and work along with the Fnatic Team to develop the next generation of products.

It’s a flexible campaign where you receive the money even if you do not reach the goal. Why did you choose this format?

Fnatic Gear products will go to market either way. The campaign is an opportunity to receive feedback from the community on our first products and to get involved. We want them to test and review our products—but of course the money we raise also helps with manufacturing, shipping and other costs.

You have reached almost 30 percent to date. Are you happy with the result, are there any plans to accelerate the campaign?

Of course we want to reach our goal and we hope to go even further beyond. It is not really about how much it will raise though, it is more interesting to get the first response of our fan base and other eSports enthusiasts. We are happy with the first 28 percent, especially if you look at the short amount of time. The campaign is a few days old and we still have more than 20 days to go. In terms of accelerating the campaign, we will present the first Fnatic Gear products at DreamHack Winter this week. Visitors will be able to get hands on our first product line, plus we have a few surprises planned and are looking forward for your feedback. After DreamHack we will announce more news and activities, so watch out!

You emphasize feedback. What if the customers are not satisfied?

The sample products we will show on DreamHack are meant to make sure we only built quality products. The early feedback is important to adjust issues that might come up. However we truly believe that we will satisfy our customers. We have spent a lot of time to develop and design our first products and with the help of our pro-gamers we were able to make sure, that we create what we call “esports grade gaming hardware.” As a last resort we have a customer service and a two-year warranty in place, and a 30 day unopened product return policy like any other gaming peripheral business.

Why did you want to create your own equipment in the first place? And why do you think you have the knowledge to produce peripherals?

Fnatic has been in esports since 2004 and, having competed at the highest levels over many years, we built up an extensive experience with gaming hardware ever since. We just feel it can be better. During our years of success, we have created a large fan base, and maybe even more important we have followers who love esports as a whole. Our brand is now reaching a global audience, North and South America, Europe, Asia, Far East—we basically have fans and followers from all over the world. Fnatic Gear is addressing its fans and all those esports enthusiasts by developing gaming products that are free from unnecessary features, are ‘eSports grade’ and at a fair price. We want to add even more to esports than our teams and players.

Of course, we did not have the knowledge to produce gaming peripherals and so we’ve been on a journey to find the right company with the know-how and infrastructure, but more importantly with the same product philosophy as we do. That company turned out to be Swedish based Func.

Some early critics state that you just took Func peripherals and put a Fnatic logo on it. Others ask if it’s just a partnership or more?

We acquired 100 percent of Func. Fnatic Gear, is a full subsidiary of the Fnatic organization. The story behind it is simple: We could not do it without Func. We are taking their product know-how, their design philosophy and experience in development and distribution. We’re bringing our vast brand, our values and eSports philosophy, which makes this such a great combination. Yes of course we are building forth on already good products and design, but other than that we develop everything from scratch. We believe that Func already made great products and had a nice design philosophy, otherwise we would’ve been silly to acquire them.

We believe in Funcs former products, the staff and the design. But anyhow, we will make changes too so we deliver 200% on our promise. Depending on how fast Fnatic Gear will grow and develop we also be expanding the organisation.

I imagine that Fnatic Gear will be of interest for Fnatic fans in the first place. That’s a limiting factor for selling your products, even as one of the most influential esports brands, isn’t it?

No, we don’t think you have to be a Fnatic fan to buy Fnatic Gear. [perfectpullquote align=”right” cite=”” link=”” color=”” class=”” size=””]We embody everything what esports is about.[/perfectpullquote]

Excitement, drama, skill, etc, Fnatic Gear is for everyone who loves competitive gaming, tournaments, pro-gamers.

It is esports grade gaming hardware for an affordable price.

We have a vision at Fnatic. We want to be the lifestyle brand for esports. Like Burton is for snowboarding or Vans for skateboarding. Fnatic Gear is for people who share the excitement of esports, who want more than just another high-end technical feature that always comes with a price. Our esports gear is about simplicity, comfort and reliability, product aspects that our pro-gamers equally care about.

As you mention the pro’s. How did you involve the players in the manufacturing process?

Basically we took the product design of Func and started to develop everything else from scratch. The placement of buttons, the grip, the sensitivity, sensors, DPI—we talked through everything. The main question was: What is really needed? We involved the players by directly taking feedback from them. How is the feeling of the product, how is the quality of technical features? Of course we also need to make sure to get a product that has a fit for a larger audience.

Fnatic Gear is a long-term project and so our strategy is to continue to develop products with the involvement of our players and the community.

The move into selling peripherals was received as a decision against your long-term partner SteelSeries. Why do you still think it is the best for Fnatic?

It wasn’t a decision against them at all. We had a good, fruitful and healthy relationship. Yes, the partnership has ended with us making the step into hardware. It’s a consequence we had to face. But I still want to give credit to SteelSeries for supporting us for so many years. We have been working together very well and the personal relationships that were built, still exist.

From an outsider’s view it looks very risky to invest in a new business like Fnatic Gear, while cutting of the revenue of a direct gear sponsorship.

There is always risk involved. We take the risk because we believe in our brand and esports in general. Our merchandise has a huge demand, sometimes higher than what we expected ourselves. Fans and supporters from all over the world ask for our products. We are not just chasing our vision with Fnatic Gear, we are also answering a strong demand. The market is there and we need to start supplying it. We would not have launched Fnatic Gear without this demand.

Is Merchandise undervalued in the esports industry? Figures show that Merch only plays a small role compared to sponsorship money for example.

In general yes. But it’s not holding true for Fnatic. [perfectpullquote align=”right” cite=”” link=”” color=”” class=”” size=””]Merchandise might very likely overtake sponsorships as a revenue stream in the near future.[/perfectpullquote]

The market and demand is there. Merchandising is getting more and more important for us. Sure, there is an increase in sponsorships as well. But what I see everyday, is that we sell more and more merchandise. Other than sponsorships, which often last one or two years and have to be renewed etc., merchandise is a steady income. The only question is: How quick can we supply? I think our strength in merchandise is also an indicator of how well the Fnatic brand is situated.

Let’s move on from Fnatic Gear to something else. The LCS off-season roster changes are ongoing and we witness what some call the european exodus. European top-players are leaving for North America, many argue because EU underpays their players. Any thoughts?

Some of the offers that are being made right now, don’t reflect reason or sense. I think that it creates a bit of of bubble in the LCS. I can’t say if it’s going to become a real bubble, but what I know is that we’ve been around for more than ten years and we know how to sustain a healthy business. Some of the most recent events are not for the better of our industry. We as Fnatic will walk our own path and follow our vision and philosophy.

One last question: Your League of Legends roster presented itself with personalized NIKEiD sneakers at the World Championship. Is there something going on between Fnatic and NIKE?

The shoes were a gift for winning the Summer Split, a little something for our players. We felt it looks really good and the players liked it too. The huge attention that came along with the shoes, accidentally created a showcase for us though. Of course we want to show non-endemics like NIKE that they should take an interest in our industry. Just three seconds of footage at Worlds created so much interest, it was really amazing. From a business perspective we need to talk to those brands, to showcase what esports can do and what Fnatic can do.