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The streamer who spent $1M on an esports team says esports is a terrible business: ‘Everyone is losing a lot of money’ (www.pcgamer.com)

submitted 1 year ago by nanoUFO to c/games

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[–] [email protected] 4 points 1 year ago

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.