Your Portfolio And Esports

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The global mobile gaming market is expected to grow from $101.21 billion in 2021 to $116.43 billion in 2022, at a compound annual growth rate (CAGR) of 15.04%. The mobile gaming market is expected to grow to $209.12 billion in 2026, at a compound annual growth rate (CAGR) of 15.77, according toYahoo!Finance.

Luke Alvarez is an expert in gaming investments. He is Founder and Managing Partner of Hiro Capital, and runs Europe’s leading games and esports venture capital fund. He reports that games as an industry have gone from niche to mainstream over the past ten years.

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Driven by the rollout of smartphones and the development of emerging markets, this industry has gone from one hundred million players of video games in the mid-1990s, to two hundred million in the mid-2000s, to around three billion now.

He believes games will now go from being mass market to being an absolute central pillar of the mid-twenty-first-century economy and society and our lives.

So where exactly are some of the opportunities?

Wearables And The Internet Of Things

Games and esports are starting to be transformed by wearables. New game wearables – VR glasses, game controller wearable rings, gamer smartphone peripherals, and esports wearables such as fitness and health trackers, esports-specific sensors, and AR glasses – are mostly still early stage and not yet at mass-market maturity or cost.

These technologies will become mass-market products during the 2020s. They have the effect of bringing games off the chair into the real world and of bringing real-world analog sports more and more into digital and simulated online environments.

Internet Cafes And Tournament Venues

Some geographical regions, including developing countries in Asia, Africa, South America, and the Middle East, necessitate icafes for practical reasons: disposable income is too low for a robust PC and broadband connection at home, or the telecommunications infrastructure has yet to be fully built out to homes.

Lisa Hanson is an expert on esports and video games in Asia. She sees esports as a global industry, with Asia leading the way in both innovation and enthusiasm. Gamers go to internet cafes for three main reasons, she explains.

The first reason is that their favorite game, which is served over a robust network, is not optimally played in their home environment. The internet cafes download client software for many client-based games and offer Steam and other premium platforms.

The second reason is that icafes often set up esports competition zones, where the tables and PCs are lined up 5v5 or other ways for team-based play. Sometimes there are even spectator seats.

And the third reason is that icafes offer a social venue to go on a date, hang out with friends, form casual teams, practice, play, get to know each other, and have fun chatting while gaming.

Entertainment For The New Generation

Adnan Akdemir, CEO Eurasia Cinemas, is a third-generation entertainment entrepreneur. He cofounded the International Istanbul Film Festival to rejuvenate the Turkish film industry. He unsurprisingly has a finger on the pulse when it comes to knowing what the future of entertainment holds. After twenty-five years of movie operation, he has decided to invest in esports.

His reasoning is that esports cafes offer several thousand square meters of facilities for tournaments with professional gamers, special training rooms, and even a specialized hotel for esports boot camps.

We have built cafes all over Turkey, Greece, Cyprus, and North Macedonia, and continue to expand into other countries with international partners.

Dominance Of Mobile Esports

Mobile games have lower barriers to entry, more balanced demographics, and higher install rates in comparison to PC and console games. This allows for better economics and higher dollar-to-player value in producing tournaments. Another part of this equation is demographics.

Mobile gaming reaches a much wider demographic than PC gaming across age and gender.

Women have historically been underrepresented in esports both as players and as fans. Mobile esports is a chance for the industry to improve its coverage and to reach a part of the gaming population that has not been well served by console and PC esports. Numbers are a big factor in the power of mobile esports.

We are already seeing how powerful the mobile esports audience can be across Asia. There are a lot more gamers on mobile, and this translates to higher revenue for mobile titles. Because esports remains a publisher or operator-driven industry, the value these players generate translates to higher investments back into esports.

Becoming An Investor

As with all investments, buyer be educated. It’s important to diversify. If you decide to invest even a small amount of your portfolio into the esports/gaming sector, there are many opportunities to investigate.

Leaving Luke Alvarez with the last word, “What we look for when we invest in a game studio or game technology company is a multitude of different factors, which boil down to three key criteria: the quality and resilience of the team, the defensibility of the technology or content moat, and the scale size of the market they are targeting.

Fundamentally, we believe that games and esports will be a central pillar of entertainment, economic, and social life in the mid-twenty-first century. Therefore, we seek out and invest in those innovators who are building that very future.