Is Esports worth investing in?

Community Sep 26, 2022

It's no wonder Esports is worth roughly $1 billion in 2019 and are projected to grow 400% in the next seven years to $4.28 billion by 2027.

Overview:

Esports, which turns playing video games into a spectator sport, is expected to grow to an audience of more than 530 million in 2022.
The growth in Esports has generated interest from investors and could have the potential for significant profits.

Esports has expanded into a sizeable worldwide sector as millions of individuals have integrated video games into their daily lives. According to market research company Newzoo, the viewership for Esports, which converts playing video games into a spectator sport, is predicted to reach more than 530 million in 2022.

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Investor interest has been sparked by the expansion of Esports, which has the potential to provide large profits. What you need to know about Esports investment is provided here:

Expansion of the Esports industry

Even though watching other people play video games can seem strange to those who aren't gamers, Esports has drawn a sizable audience in its early years. The worldwide Esports viewership is expected to increase by approximately 9% to 532 million people in 2022, according to Newzoo. Nearly half of those individuals are classified as "Esports aficionados," meaning they regularly watch Esports programming.

According to Juniper Research, Asia-Pacific, North America, and Europe are the three biggest Esports markets. The Asia-Pacific region accounts for more than half of the worldwide Esports viewership. Latin America is anticipated to be a significant growth area as well.

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Many businesses have made significant investments in the potential of Esports, but Microsoft's upcoming $68.7 billion acquisition of Activision Blizzard could be the biggest. Some people believe that popular titles like Call of Duty, StarCraft, and Overwatch from Activision may be a perfect match for Esports. Before the firms may complete the acquisition, regulator approval is required; this is anticipated to happen in mid-2023.

Growth of Esports platforms

As Esports have expanded, many platforms have enabled spectators to access their preferred interactive media. One of the first sites to become well-known among Esports fans was Twitch, owned by Amazon (AMZN) and is still one of the biggest today. According to the firm, Twitch has roughly 2.5 million viewers at any time, and in 2021, users viewed more than 1.3 trillion minutes of video on the platform.

Other digital behemoths are also participating in the gaming fun, with Alphabet's (GOOG) YouTube being one of the most popular websites online and Meta Platforms (META) having success with its Facebook Gaming platform. Users in China, where Esports are very popular, must depend on websites like iQiyi, Tencent Video, and Youku since some of these services are restricted.

Top live streaming platforms

6.13 billion hours on Twitch
Live gaming on YouTube: 1.13 billion hours
Gaming on Facebook: 803 million hours

How to invest in Esports

Individual stocks: When you purchase a stock, you become a shareholder in the firm. This strategy offers the most considerable potential for significant rewards, but it also takes more study and might be riskier than investing in funds since you won't be as diversified.
Dedicated funds: Investing in Esports-related mutual funds or exchange-traded funds (ETFs) is another strategy that carries less risk than purchasing individual equities. The fund's success won't depend just on one or two assets since you'll have a diverse portfolio of businesses. The fund's expenses, which will be deducted from your investment return, should be carefully considered. Low fees from the finest ETFs increase your total returns.

You must first create a brokerage account and deposit funds to be utilized for investing before you can purchase any securities. The top online brokers provide a wide range of research resources to aid you in choosing assets, and after you've chosen a choice, you can quickly make a transaction.

Celebrity investments in Esports

Michael Jordan, Magic Johnson, Drake, and other well-known investors have all shown an interest in investing in Esports. Jordan and Johnson have investments in Team Liquid's parent firm, aXiomatic Gaming. In 2018, with producer Scooter Braun, Drake invested in the Esports league 100 Thieves.

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Esports with TournafestAnanta Ghosh

Other famous people said to have invested in Esports include Steve Young, Sean Combs, Kevin Durant, Odell Beckham Jr., Stephen Curry, and Andre Iguodala.

Types of Esports stocks

There are several methods to invest to gain from the expansion of the Esports business as it continues to expand and change. Here are several to think about.

Game developers: Owning businesses engaged in game creation is one of the easiest methods to invest in Esports and the video game industry. Activision Blizzard, Electronic Arts (EA), or Take-Two Interactive Software may fall under this category (TTWO). Popular video games like Call of Duty, Madden, and NBA 2K are owned by these corporations.
Esports teams: Investing in Esports teams may be challenging since they often operate as private businesses, while some public choices are available. AFC Ajax and AS Roma are two European football clubs that have established their Esports teams and are publicly traded (ASR.MI). Comcast, a major player in the media industry, is developing an arena in downtown Philadelphia and owns an Esports team.
Gaming hardware: If you want to invest in gaming hardware manufacturers, you may think about Microsoft, the creator of the Xbox, or Sony, the maker of the Playstation (SONY). You may also consider Meta, whose Oculus virtual reality device has gained popularity among gamers. Esports gambling: Betting on sports has become quite popular, and Esports is no different. One of the top sites for sports betting, DraftKings (DKNG), now provides Esports choices.

The future of the Esports industry

Esports are currently in their very early stages of growth as a whole, so only time will tell how they develop and if they become popular sports like baseball, basketball, and football. Mobile gaming and live Esports betting are areas with a lot of promise that might help Esports reach new heights.

Even if some think Esports are in a "golden age," it still accounts for a small portion of the entire gaming market, less than 1%. That figure demonstrates both the immense potential and the significant uphill battle that Esports still face.

Until next time,

#liveitforgaming