Though video games were all the rage in 2020, pro teams had a tough year in more ways than one.
According to the research data analyzed and published by Safe Betting Sites, the average value of the top ten teams in eSports flatlined at $240 million. Comparatively, they had reported a 54% year-over-year (YoY) valuation increase in 2019. Their median value was $188 million during the period.
TSM, formerly known as Team SoloMid was the highest valued team in 2020, worth $410 million, up by $10 million or 3% from 2019. Cloud 9 took the second place with a valuation of $350 million, marking a 13% decline from 2019 when it was worth $400 million.
Team Liquid came in third with a $310 million valuation, down by 3% from $320 million in 2019. Rounding up the top five were FaZe Clan, worth $305 million, up by 27% from $240 million and 100 Thieves, worth $190 million up by 19% from $160 million.
Among the teams that dropped off the top ten was Immortals Gaming Club. In 2019, the team sat in the fifth spot with a valuation of $210 million. Its value in 2020 was less than half that amount. Over a span of two years, it paid out a collective $58 million to its teams that compete in major franchise leagues.
Due to event cancellations, Immortals took a 23% hit in revenue and had to unload teams. In November 2020, it sold its Call of Duty League (CDL) franchise to 100 Thieves. It also sold its OpTic Gaming brand name, which was worth $10 million according to Forbes. Its 2020 revenue was estimated to be a mere $8.5 million.
TSM Generated 50% of 2020 Revenue from eSports, 100 Thieves 35%, FaZe Clan 20%
Overall, however, the top eSports teams have experienced remarkable growth in recent years. According to Visual Capitalist, four of the top 10 teams were valued at over $300 million in 2020. Comparatively, only one team was worth more than $300 million in 2018. Part of the reason for the growth is the fact that a good number of top teams have diversified beyond eSports.
According to a report by Forbes, venture capitalists have invested $4.8 billion in the ecosystem over the past five years. Flatlining company valuations are causing these investors to put pressure on the companies to make more money.
The top-valued team in 2020, TSM, generated only 50% of its revenue from eSports during the year. In a bid to diversify, the company acquired Blitz, an ad-supported app, in 2020. The app had 10 million active monthly users at the end of the year.
On the other hand, FaZe Clan generated a mere 20% from eSports. 80% of its revenue came from videos created around its stars and gaming culture. It has more than 230 million followers across all of its social platforms.
Its lineup includes Nickmercs, one of the highest paid players and was the 14th most followed streamer on Twitch. As of mid-December 2020, he had amassed over 44 million views for the year and was the second highest earner on Twitch with $1.74 million.
100 Thieves, which shot up from the 10th spot to the fifth place in valuation, generated 35% from eSports. In January, the company opened a production studio and training facility. It signed with CAA, a talent agency, in October to get its content on mainstream platforms like Amazon and Netflix. The company is also investing in traditional sports. In November, it signed YouTube stars 2Hype who shoot basketball-related videos. They boast a following of 18 million subscribers.
Lowest NFL Team Worth $2.0 Billion in 2020, Compared to Esports’ $150 Million
Notably, Team Liquid and Cloud Nine were the only two teams to post valuation declines in 2020. Team Liquid generated 89% of its revenue from eSports while Cloud Nine did 70%.
While eSports teams have grown quickly over the years, they are still a long way off from catching up with major leagues in traditional sports.
According to Visual Capitalist, the lowest valued team on the NFL in 2020 was worth $2.0 billion while the highest valued was worth $5.7 billion. The league’s median team value was $3.0 billion.
On the NBA, the lowest valued team was worth $1.3 billion and the highest WAS $4.6 billion. Median team value was $1.8 billion.
The MLB had a median team value of $1.6 billion, with the highest team valued at $5.0 billion and the lowest at $980 million.
Comparatively, the lowest valued team in the top ten teams on eSports had a $150 million valuation.