This Company Could Be A Hidden Gem of the Gaming and Esports Industry

The growth of gaming and esports has been nothing short of remarkable in recent years.  From the rise of competitive gaming to the emergence of streaming platforms, the gaming industry has seen a massive surge in popularity — and only in the last five or so years has the market seen significant gaming and esports IPOs.

In the early days of gaming, it was mostly a hobby for a select few. The rise of online gaming has allowed gamers to connect from all over the world, creating a vibrant and competitive gaming community. Now, with publicly traded players across the industry, both gamers and traders are getting in on the action.

The emergence of esports actively being powered by companies like ESE Entertainment Inc. (TSXV; ESE) ENTEF has been a major factor in the growth of gaming. Esports tournaments have become increasingly popular, with millions of viewers tuning in to watch the best players compete. 

The widespread adoption and playing of games mean industry revenues are growing. The global gaming market was worth $202.64 billion in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 10.2% from 2022 to 2030. Innovation and technological proliferation in software and hardware are key factors fueling the market's growth.

Time To Pay Attention To This Little-Known Player?

ESE Entertainment was founded in 2019 by Konrad Wasiela, a former professional football player. Today, ESE has grown to consist of multiple assets and world-class operators in the gaming and esports industries. Its core expertise is in bringing new users and players to video game developers, and increasing game publicity. Through its technology, ESE becomes a key part of video game developer team’s in order to make their game launches successful.

The company has provided billions of user impressions to keep the games of game publishers like Roblox Corp. RBLX, Riot Games, Electronic Arts Inc EA, and Ubi Soft Entertainment UBSFY filled to the brim. ESE asserts that its core expertise is bringing new users and players to video game developers and increasing game publicity with a consistent and proven track record.

Big Data And Artificial Intelligence

Another significant product offering from the company is its intelligence product, Singularity, a machine learning technology product that creates individualized marketing profiles – resulting in more efficient and profitable player acquisition campaigns. The technology opens up big query capabilities and provides real-time analytics, reporting, and machine learning for customers and the company. Additionally, ESE recently announced integrating ChatGPT into its business models. 

All in all, ESE is a data company and makes money in a similar way to social media platforms like Meta Platforms META’s Facebook — by acquiring a game user by advertising and selling the user to a game publisher, ESE makes revenue based on the difference in value.

The company also is expanding the same business model of user acquisitions to other lines of business within gaming to sports wagering, which is another large market itself and with higher margins based on the value of the player.

Company Highlights

• The company’s annual revenue run rate is $64 million (based on fiscal Q3 2022 revenue).
• The company grew revenues by 276% between fiscal Q3 2021 to Q3 2022.
• ESE has strong management with proven results and industry expertise.
• The company has a tight capital structure with limited downward pressure.
• Its valuation is at approximately 0.5 times the last twelve months (LTM) revenue, with comparables being at more than twice that.

Experienced Management Team And Growth

Backed by Konrad Wasiela and a team with more than 50 years of combined experience in the entertainment and sports industries, the company believes it has the requisite skill pool to ensure transparency, longevity, and results.

ESE is diversified with valuable resources globally and could be uniquely positioned to capitalize on the hottest consumer trends in the evolving video game industry. The company remains committed to pushing the boundary while solidifying its reputation as a leader to its investors, partners, and clients.

Featured Photo by Alex Haney on Unsplash

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