The marriage of Esports and gaming seems as if it was a match made in heaven. Gaming revenues are steadily growing with no end in sight and eSports has emerged from a subset to a full blown industry itself. The net result is that esports has matured from its roots in arcade gaming to the complex digital ecosystem it is today.
As a result, the industry has seen a huge uptick in investment from venture capitalists, and more recently from private equity firms. The number of investments in esports doubled in 2018, going from 34 in 2017 to 68 in 2018, per Deloitte. That’s reflected in the total dollars invested, too: Investments are up to $4.5 billion in 2018 from just $490 million the year before, a staggering YoY growth rate of 837%, per Deloitte. These investments are distributed to players across the ecosystem — from eSports organizations, to tournament operators, to digital broadcasters — allowing it to function and grow.
Recently, Business Insider, looking at eSports market size and trends said: “Most projections put the esports ecosystem on track to surpass $1 billion in revenue for the first time this year. And revenue is expected to grow from here.” Newzoo projects it to hit $1.8 billion by 2022. Money flows into esports through media rights, live event ticket sales, merchandise sales, and in-game purchases, but most of the revenue (69%) comes from sponsorships and advertising, per Newzoo figures cited by Statista.
It continued stating that the growing revenue stream comes in from around the world. “Asia-Pacific (APAC), North America, and Europe are the top three esports markets, respectively, in terms of audience and revenue. APAC will account for over half (57%) of global esports viewership in 2019, up from 51% in 2017, per Newzoo. Meanwhile, North America is set to hit $300 million in esports revenue this year, while Europe is expected to reach $138 million, per PwC estimates. The rest of the world only accounts for about 15% of total esports revenue, but it contains several regions to watch. One of the fastest-rising regions is Latin America, which is expected to hit $18 million in esports revenue in 2019 before skyrocketing to $42 million by 2023, per PwC estimates. “