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2021’s Surging Investment Opportunity? E-Sports is the Answer

Stockhouse Editorial
0 Comments| February 22, 2021

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(Click image to play video)

Despite most of our social plans being ruined in 2020, one industry that has not only remained afloat during the COVID-19 pandemic but thrived is e-sports. Gaming market analytics company New-Zoo forecasts that the industry will generate over $1 billion for the first time in 2021.

There’s more to e-sports than just games on computer systems as well, and Fandom Sports Media Corporation (CSE.FDM, HTTRF:US, OTCMKTS: FDMSF, Forum) has been supporting a diverse set of assets, the latest of which is the Fandom platform, which will go live with both a free play and a wagering marketplace. Bettors will be able to select from hundreds of wagers on dozens of tournaments across games.

Trading on the Canadian Securities Exchange under the symbol ‘FDM’, the Company is developing and deploying a web application that instantly operates on Android and iOS mobile devices targeting E-sports Super Fans.

In this fascinating video Q&A, Stockhouse Media’s Dave Jackson was joined by Fandom’s CEO and seasoned capital markets professional, David Vinokurov, to talk about his team’s recent L-O-I's, the upcoming launch of their e-sports and wagering platform, and their recent partnership announcements.

TRANSCRIPT BELOW:

SH: Thank you for joining us today. Many were tracking e-sports at the start of the pandemic as an industry to watch, believing that competitive gaming was set to grow with so many isolated or under lockdown. From your experience, how has e-sports grown in the past year?

DV: The growth has been frankly off the charts. I've been involved in various aspects of the industry going back several years now and all the projections that I saw from 17, 18, 2018 through 2022, 2024. Those are all blown right past, right at the beginning of the year. In terms of the future projections from 2021 now moving forward, I still haven't seen any realistic set come in because we still haven't settled into what that new normal is. There's been such a tremendous rush to adoption with viewers and players in light of what's been going on with COVID unfortunately that it's been a - I hate to use the cliche term - but it has been paradigm-shifting for the industry where it's just rapidly accelerated beyond anyone's expectation in the short term.

SH: What do you predict for the industry’s growth in 2021?

DV: We’ll see that volatility, that volatile growth reverts to the mean as we always do in any industry. Things will settle at a much higher level in terms of fan engagement viewership numbers, sponsorship opportunities, it's accelerated the adoption for people watching events. That's created increased metrics for teams and organizations holding events, and that's how the corresponding effect to advertising rates that we're seeing right now in terms of sponsorship opportunities for companies such as mines for other service providers to get the eyeballs from that larger audience from those teams that are having these increased levels of engagement.

SH: For those who are new to e-sports, the best way to get up to speed is to watch the action. What initiatives is Fandom involved with coming up?

DV: Well, most immediately we're preparing to launch our wagering and free play platform. You'll be able to watch your favorite e-sports team or favorite game that your favorite team may be playing. And you'll be able to make predictions along with what's going on in the game in real-time. We'll be able to do that in a multicast environment. As I'm watching something within our app, we can switch between multi games that are occurring at the same time, make predictions to switch back. Everybody nowadays is used to a dual-screen environment. I may be at home watching TV. The spouse may be beside me sitting on their phone, playing on Instagram. Everyone's used to multi-screen environments. What we're trying to do is tie that experience together. We’ll be coming out with more new games, more new features that will unify the experience across game titles, across streaming platforms. At the end of the day, we want to be a technology provider across the entire ecosystem.

SH: What are some of the top games that people are playing that draws the biggest audiences?

DV: League of Legends, that's the number one title, more people viewed the League of Legends finals than the Super Bowl. CS:GO – Counter-Strike Go, Dota 2, Valorant. It's a pretty long list, we have the EA sports titles: NBA, 2K Madden football. Anything that you would watch on TV, any traditional sport that you were watched plus any potential fantasy genre, that existed in the e-sports/gaming world. Whatever you like on regular TV, there is a digitized form of that content odds are that there is a professional team or association affiliated with that content. My opinion, going back to your earlier question, is that we'll see a convergence of sports e-sports content entertainment all into one. We want to be at the forefront of facilitating that interaction in these dual-screen environments. Now, you’re wagering.

SH: Your wagering platform sounds very intriguing; built upon proprietary data feeds from leading e-sports game publishers. Can you go into a little more detail about it?

DV: Sure, certainly. So typically, how a lot of wagering platforms operate today. They buy data feeds from third-party providers that have their relationships and their own API APIs, which are digital connections with game publishers or tournament hosts, do they then sell to the same data pack to any number of wagering platforms? There's no differentiation in a win, lose, draw bet, or statistics that people are wagering and soul about user aggregation who can get the most number of users at the cheapest cost. Then the razor-thin margin, the same principle that you see in Las Vegas. You look down the strip, there are 20 different hotels on either side of the street, they'll offer all the same games. What's the difference? It's the level of service and the ability to keep people within the hotel, right?

Their stickiness, or to reduce their trend factor from a tech perspective, what we're able to do based on the unified information access platform that we have this proprietary to us in the sports sector is that we can build our APIs, which we have done the number of predictions on the old age of side or wagers on the regulated wagering side that we can offer just on the top three titles league of legends, CS go and Dota two it's, frankly, it's infinite, right? Our system can handle, recognize and interact with the digital memories that the system teaches itself to be able to offer these new types of predictions on the fly that differentiates itself on a very fundamental level versus the technologies that our competitors are deploying.

SH: In anticipation of the upcoming launch of your wagering platform, Fandom just unveiled its new website. What can you tell us about its redesign and functionality?

DV: I'd love to tell you that our new website can do all these wonderful bells and whistles, but just know that the important thing is that we're going to be hosting it on our private cloud. Our chief technology officer Stanley Yazhemsky, he's all about security, safety, and scalability. We're going to be hosting private-owned infrastructure on the site, as you see it today, fandomesports.com. That gives you an idea of the brand language and the image that we want to promote moving forward. But the real functionality will come with the wagering platform launch show that's imminent, we're not talking months, right? We're very eager to get that out. We have a large community of shareholders all over the world, frankly.

They're excited to see that I'm excited to get them out that out to them. And then we have, again, a long list of features that we're going to be building out onto our platform in a modular way. It's not just going to be a wager or prediction. You'll be able to do these things on the fly while you're watching content, sorry. I think, at the end of the day, we want to create an engaging experience for e-sports fans. As you're watching a particular event, if you're playing along at home on your phone, you're watching it for longer there's value to the advertisers. There's a value to the teams and the organizations as they're able to collect more data, and there's a value to the consumer because hopefully, they're having fun throughout the process and the value for the company. As you know, we have different ways to monetize that interaction through revenue shares on, on advertising commissions on wagering. When we get our odd lines up, we'll be the house on certain wagers. There's a lot of ways to slice the pie and hopefully a lot of ways for us to create shareholder value.

SH: Fandom recently entered into a letter of intent with Funjoy Company of China, where you will develop initiatives related to your Unified Information Access Platform technology for predictions for e-sports games, events, and streaming platforms. Can you break down the benefits of this team up for investors?

DV: Our chairman Philip Chen, he's got fantastic lengthy contacts in China with some of the largest technology players in there from FinTech to social companies, to e-commerce to gaming a lot. There there's a lot of these companies that are under giant ownership umbrellas without having any other names but Funjoy, which is owned by Next Joy, has access to hundreds of millions of users in China, who are e-sports fans. China is the largest e-sports and gaming market in the world, frankly. What we're going to be doing as we roll out our wagering and free play platforms globally, we'll be collecting data and measuring the interaction levels with people across games the types of interactions that they are encountering on our platform with their favorite content creators and so forth, providing those analytics back to Funjoy.

And we have a mandate to explore deployment across several different verticals that they have access to from a large-scale enterprise tournament hosting for educational institutions in China white labeling the entire platform for specific streaming platforms that we have access to in China. There are some very cool things that we're planning on doing with non-fungible tokens for designing those innovation studios. It’s a roadmap for us to partner with senior-level high tier organizations that we can have an impact across the entire industry, not only in China but across the world. It’s a tremendous opportunity. I've had numerous invitations to be there, unfortunately over the past few years, but the extent of my visits has been via these wonderful zoom and digital meetings, but I'm excited to get over there and meet our partners there. And we're working very closely with them to get them what they need to help us scale over there as well.

SH: The same question, but looking at Gamerwager Limited…

DV: That's a very interesting platform that's built-in already servicing tens of thousands of users in the UK. They have a UK wagering license that what we want to do is we want to offer their head-to-head wagering as a complimentary service to the peer to peer wagering that we're launching at first. This will - we're in the process of setting up the formal agreement because as you can appreciate, we have a curious out I-gaming license, they have a UK gaming license. There are certain things that the lawyers are looking forward to so that we ensure that we stay to best practices with both licensing regimes. There were the three integrations and payment processing flows, and so forth. The goal for that is to be able to offer their head-to-head wagering to our customers under our licensing umbrella and be able to promote fandom platform in the UK under their umbrella.

That is one of several initiatives that we have at fandom to expand our licensing footprint, to offer more complementary services to our players and our fans on our platform through partnerships that we can scale cheaply, and it saves us the cost of having to go get the license ourselves. We're always looking for world-class partners and gamer wagerers. I want to give a shout-out to our advisory board, John Armstrong; he put us together with a fantastic team of Gabriel wagers and a fantastic profile platform. And we've got more things up our sleeves.

SH: Prize pools are the main goal for players. Has this changed under the pandemic and what do you see for the size of winnings going forward as e-sports becomes mainstream?

DV: Its price feels definite, right. These are competitors, these are athletes, everyone wants the glory of the trophies and what the trophies come with. We see those increasing I continue to see that increasing, at what point do we see parity with traditional sports teams? I think we're still several years away from that in terms of - see some of the top footballers making hundreds of billions of dollars, I don't see any e-sports players doing that yet, but there're dozens of them making millions of dollars a year plus sponsorship opportunities. Adidas has e-sports-specific footwear, right? It's my opinion on all this, we are going to see a convergence between sports and e-sports within the next five to ten years.

And this all is going to be sports. It's just a different way to play and compete and train. You can't just sit there and, for some of the listeners that aren't e-sports fans, these are professionals that have trainers and physiologists, therapists, and mental coaches, because it's fun to sit for an hour and play, but when you're doing that for 12 hours a day, you have to stay sharp. They’re professionals, they're treated as professionals. They should be paid as professionals and they are now, but there's still more money on the table.

SH: Looking out to the latter side of 2021, is there anything on the Company’s horizon that investors should keep an eye out for?

DV: We are. As I said, imminently, launching our wagering and free play platform. We're working on an all-ages platform that is going to be more focused for underage players to create the game, to greet the game experience as I'm watching something I'm playing along, I'm winning points on chatting with my friends. I'm challenging my friends to predictions. We're looking to release that mid to late this year. Ultimately by the end of the year, we'd like to get our Asian deployments going whether it's white-labeled or what have you in different iterations. It's going to be a very big year for us. I'm just excited. I wish I could fast forward and see where we are in December 2021 and tell you what we're working on for next year. We've got a lot of stuff in the pipe.

SH: Thank you again for your time today, David. Anything further to add?

DV: The symbol is FDM, stay tuned, lots of good stuff coming. I appreciate your time, Dave, and look forward to chatting with all our shareholders again.


To learn more about the Company, visit fandomesports.com.


FULL DISCLOSURE: This is a paid article produced by Stockhouse Publishing.


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