The streamer who spent $1M on an esports team says esports is a terrible business: ‘Everyone is losing a lot of money’
The streamer who spent $1M on an esports team says esports is a terrible business: ‘Everyone is losing a lot of money’
Disguised Toast has shared a blunt, bleak look at the current state of the esports business in North America.
To be fair, he bought the esports team in an attempt to save the league and the sport as a whole. He was well aware that it was on the verge of collapse. It's a passion project for him, something to spend his streaming money on.
Disguised toast seems like a really good dude tbh, didn't know about him until he got into esports but he's really been a breath of fresh air for that scene.
Once he signs DSG | Cody to dominate the melee scene he will be the goat team owner
Recently Richard Lewis made a video about the financial situation in eSports: Esports Fans Need To Start PAYING
I know Ence is one team in CSGO who's generating profits. They are a smaller orgs that has in game success.
I think the issue is you have some teams full of venture money that inflates the salaries and makes it super hard for other teams to have in game success while not going broke.
That being said my suggestion for csgo (it's only scene I follow) would be leagues line in traditional sports. Each team plays a game every week and you have playoffs at the end of the year. Put those league games on your own platform and have people pay a subscription to watch. I would pay up to 100$/year (I'm aware I'm the exception). With this model you might even be able to have a few hubs where games are played at a small venue in front of paying crowd. I could imagine a few hubs where teams would move to to play regularly. Something like: New York, Rio, Malta, Copenhagen, Moscow
I think one of the biggest problem is demographics, the younger generations that's in eSports is broke. No eSports fan is going to buy a Dodge RAM (using this as an example because traditional sports are littered with pick up ads and the car industry is a huge advertiser because they need to constantly gaslight people into thinking that driving isn't a chore)
The bloke had a milly, threw it at the wind and expected it to come back to him.
I always wondered whether these teams made a lot of money or not. This makes me wonder too whether these massive esports tournaments, like CSGO majors, make a lot of money or if they’re in the same boat? I’d assume they’d have to if they’ve been going on for this long with big prize pools but I’d apply that same logic to esports orgs too.
CS.GO TO are usually sponsored by the worst people, it's comparable to football/soccer at this point. But it took how much ? 20 years for TO to creat one of the best ecosystems that doesn't rely on the game company's money that much.
I know Ence is one team in CSGO who's generating profits. They are a smaller orgs that has in game success.
I think the issue is you have some teams full of venture money that inflates the salaries and makes it super hard for other teams to have in game success while not going broke.
That being said my suggestion for csgo (it's only scene I follow) would be leagues line in traditional sports. Each team plays a game every week and you have playoffs at the end of the year. Put those league games on your own platform and have people pay a subscription to watch. I would pay up to 100$/year (I'm aware I'm the exception). With this model you might even be able to have a few hubs where games are played at a small venue in front of paying crowd. I could imagine a few hubs where teams would move to to play regularly. Something like: New York, Rio, Malta, Copenhagen, Moscow
I think one of the biggest problem is demographics, the younger generations that's in eSports is broke. No eSports fan is going to buy a Dodge RAM (using this as an example because traditional sports are littered with pick up ads and the car industry is a huge advertiser because they need to constantly gaslight people into thinking that driving isn't a chore)
Edit: mistakenly posted this on a comment before
I think the issue is you have some teams full of venture money that inflates the salaries and makes it super hard for other teams to have in game success while not going broke.
This is almost what happened to the NHL in the mid-00s, and caused them to skip an entire season. The big teams (with outside revenue, which is basically the same as VC funds in this case) used that outside revenue to try to buy the best players with big paychecks (on the assumption that financial success would closely follow competitive success), setting off an arms race that almost got to the point that a third of the teams in the league would have folded within two years.
I've never understood how esports teams make money. Does anyone know? I know regular sports teams make money thru ticket sales, advertisements, and merch. Does that carry over? There are no stadiums, so idk how that works. (I don't watch esports.)
Ad revenue, I assume. If you're watching a stream of a match, you're seeing ads at commercial breaks, on the jerseys, through the commentators branded coffee mugs etc. I assume it's also harvesting various consumer profile data that they can sell or exploit as well.
People also do buy merch, collections, in-games skins based on their favorite teams, etc too.