The Esports Advocate
Esports business news: deals, legal, and governance.
Documents
Breaking: Layoffs Hitting CLG, Sale or Shutdown Rumored
The Los Angeles-based esports organization Counter Logic Gaming (CLG) is undergoing significant organizational restructuring, characterized by widespread staff layoffs.
- Esports organization CLG is undergoing significant layoffs, as confirmed by multiple current employees.
- Reports suggest that Madison Square Garden Entertainment, the parent company of CLG, is considering either a sale of the brand or a complete shutdown.
- Under the rumored restructuring, CLG would cease most operations while maintaining only its League of Legends Championship (LCS) team.
Warner Music, Secretlab Return as Partners for EMEA Masters 2023
Riot Games has confirmed the return of Warner Music and Secretlab as supporting partners for the 2023 League of Legends EMEA Masters.
- Riot Games has renewed its partnerships with Warner Music and Secretlab for the 2023 League of Legends EMEA Masters tournament.
- Warner Music returns as the official music supplier for the fifth consecutive year, providing its music catalog for event broadcasts.
- Secretlab continues its role as the official gaming chair partner, supplying its TITAN Evo line for use during major competitions.
TSM Hitting Pause on Some Esports Efforts
The Los Angeles-based esports organization TSM is scaling back its competitive operations across multiple titles.
- TSM is scaling back its esports operations across multiple titles and is considering the sale of its League of Legends Championship Series (LCS) franchise.
- The organization's financial instability is largely attributed to the collapse of its 10-year, $210 million partnership with the bankrupt cryptocurrency exchange FTX.
- Despite the reduction in competitive esports efforts, TSM intends to continue the development and operation of its Blitz gaming application.
WePlay Academy League Paused Due to War in Ukraine
The Ukraine-based tournament organizer WePlay has officially suspended the WePlay Academy League, a prominent developmental circuit for Counter-Strike: Global Offensive (CS:GO).
- Ukraine-based tournament organizer WePlay has officially paused the WePlay Academy League, a prominent development platform for young Counter-Strike: Global Offensive (CS:GO) players, due to the ongoing war with Russia.
- The decision to halt the league was made in consultation with all participating organizations, citing safety concerns for staff and tournament participants as the primary factor.
- WePlay stated that current conditions in the region prevent the company from maintaining the operational standards established since the league's inception.
Astralis Board Initiates Strategic Review
The board of directors for the esports organization Astralis has initiated a formal strategic review to evaluate the company’s future position and ownership structure.
- The board of directors at esports organization Astralis has initiated a strategic review to explore options including delisting from the stock exchange, issuing new shares, or selling company assets.
- The review was prompted by the company’s share price trading at a material discount compared to its initial public offering price of DKK 8.95.
- Astralis reported net revenue of DKK 87.5M ($12.8M USD) for fiscal year 2022, an increase from DKK 75.0M ($10.9M USD) in 2021.
OverActive Media Makes Strategic Staff Cuts
OverActive Media, a Canadian-based esports organization, implemented a series of strategic staff reductions in March 2023.
- OverActive Media has initiated a restructuring plan involving staff cuts, with estimates suggesting between 5 and 10 employees have been impacted.
- The company has eliminated specific roles and shifted responsibilities among remaining staff, with reports indicating that further layoffs may occur.
- Confirmed departures include Connor Chambers, team manager for the Toronto Ultra, and Cameron Bloom, marketing manager for MAD Lions.
Enthusiast Gaming FY 2022 and Q4 2022 Financial Results
Enthusiast Gaming’s financial results for the 2022 fiscal year reveal a complex performance characterized by significant revenue growth offset by substantial net losses and a tightening cash position.
- Enthusiast Gaming reported a net loss of $56.6M USD ($76.8M CAD) for FY 2022, an increase from the $38.3M USD ($52M CAD) net loss recorded in 2021.
- Annual revenue grew 21% year-over-year to $149.5M USD ($202.8M CAD), while gross profit rose 68% to $63.5M USD ($63.5M CAD).
- Operating costs surged to $87.7M USD ($119M CAD) in 2022, up from $62.9M USD ($85.3M CAD) in the previous fiscal year.
Breaking: Layoffs Hit Evil Geniuses
In March 2023, the esports organization Evil Geniuses implemented a round of staff layoffs, marking the second such reduction in personnel within a four-month period.
- Esports organization Evil Geniuses conducted a round of layoffs in March 2023, marking the second such reduction following a previous round in December 2022.
- At least three high-profile employees were confirmed to be affected by the March 2023 restructuring: Director of Talent Management John Derment, LCS Team Admin Alan Ignacio, and Senior Manager of Operations Hal Sparks.
- The exact total number of employees impacted by the March 2023 layoffs remains undisclosed.
Roblox Content Creator KreekCraft Joins Misfits Gaming Group
Misfits Gaming Group has expanded its creative leadership by partnering with prominent Roblox content creator Forrest Waldron, known as KreekCraft.
- Roblox content creator Forrest 'KreekCraft' Waldron has joined Misfits Gaming Group as a creative director and co-founder of a new studio called Pixel Playground.
- Pixel Playground will focus on developing Roblox-related media and in-game content, with Misfits Gaming Group providing operational support and resources.
- The studio aims to target players over the age of 13 by designing game modes and experiences tailored to an older demographic.
Breaking: FaZe Sent Deficiency Warning by Nasdaq
FaZe Holdings received a formal deficiency notice from the Nasdaq Stock Market in March 2023, signaling that the company failed to maintain the minimum $1.00 bid price required for continued listing.
- FaZe Holdings received a formal deficiency notice from the Nasdaq Stock Market for failing to maintain the required $1 minimum bid price for 30 consecutive business days.
- The company has until September 19, 2023, to regain compliance by maintaining a closing bid price of at least $1.00 for a minimum of ten consecutive business days.
- FaZe Clan’s share price has traded below the $1 threshold since February 8, 2023, following an initial drop below that level on January 20, 2023.
Is the Russian Government Trying to Capitalize on Past Esports Successes?
The Russian government is actively attempting to leverage the domestic popularity of esports to bolster its international standing and internal morale through the creation of the "Future Games."
- The Russian government is organizing the 'Future Games' in Kazan in 2024, a nine-day event featuring a $25 million prize pool and a target of 3 billion views.
- The event will focus on 'phygital' competitions—a hybrid of digital esports and physical sports—including drone racing, digital football, and Beat Saber.
- The Russian Esports Federation (ReSF) is driving domestic esports strategy with government backing, offering participants incentives such as mortgage concessions, higher education support, and exemptions from military service.
Chinese, Russian Governments Will Work Together for International Esports Events
The Chinese and Russian governments have formally committed to a partnership aimed at developing international esports events, marking a significant intersection of competitive gaming and high-level diplomacy.
- Presidents Vladimir Putin and Xi Jinping have formally agreed to cooperate on international sports and esports events, marking the first time the Chinese leader has explicitly acknowledged esports in a joint diplomatic statement.
- China has committed to supporting Russia in hosting the 'Future Games' esports event in Kazan, Russia, scheduled for 2024.
- The collaboration is a strategic response to Russia's exclusion from international sporting events following the ongoing war with Ukraine.