Your Thursday July 7 eSports News

INVESTMENT IMPACT: CAUTION FOR COUNTER-STRIKE

My Take: The final part of Counter-Strike’s Gambling impact examines the Investment side. Even without divulging client info this is not a hidden secret within eSports: Team valuations have risen immensely and everyone is taking a hard look at the space. I’ve already discussed the now eight Professional teams that have made eSports investments outside of the rumored involvement by Manchester United and the nonsense around Bayern Munich. A US Sports team will absolutely make a move before 2017.

So if you’re looking at investing in an eSports team, the simplest way to start is by doing the following: 1) Look at their current revenue mix and 2) Analyze their future potential and accretive value to your portfolio or Sports franchise (Yes VC’s, this is more complicated but it’s basically that).

The biggest news in the VC space tied to eSports has been Sierra Maya’s “multi-million dollar” investment in Team EnVyUs. The connection here to Counter-Strike gambling is that TmarTn, who’s involved in this scandal, is also part owner of Team EnVyUs.

[Update 5: Team EnVyUs’s Co-Owner Mike Rufail responded to the allegations by distancing themselves completely and minimizing Tmartn’s involvement, contribution, and financial impact. At this time, TmarTn is still part of Team EnVyUs. I won’t debate the level of involvement here but I don’t believe TmarTn would have been able to secure the four brand sponsors without having the Team EnVyUs brand]

I don’t have insight into Team EnVyUs’s financials and therefore won’t comment into the impact, if there’s any at all. However, I have praised many times what Team EnVyUs and Co-Owner Mike Rufail have done to grow the industry and also help establish Charlotte as a home for eSports. I hope that this deal opens the door to more — prudent — investment into eSports. I’d be curious how much if any of their revenue is tied to CSGOLotto but here’s the bigger takeaway: Revenue based on Counter-Strike is a small flag for future team investment.