This week, esports insights company Newzoo came out with a new report that indicates an estimate that the esports economy will reach $905.6 million in 2018 with brand investment growing by 48%. Those are massive numbers for a young industry that is still growing with record speed and finding more people from outside of the space yearning to get involved by way of investment.

A new investment was also announced this week into FanAI Inc., which is a platform that unlocks the value of esports fan data in an effort to optimize sponsorship engagement within esports. This company hopes to serve an important role, as the Newzoo report reflects that 77% of the growth of the global esports economy will be directly attributable to sponsorship and advertising.

Sponsorship in the esports industry is expected to come in at roughly $360 million in 2018, which would account for a 53% increase from 2017.

FanAI's new investment is worth $2.5 million, which brings the total amount raised by the company to $4.5 million since its inception. The round was led by Courtside Ventures and CRCM Ventures, with participation from BITKRAFT Esports Ventures, BDS Capital, Catalyst Sports, Deep Space Ventures, Everblue Management, Greycroft GC Tracker Fund, M Ventures, Rosecliff Ventures and Sterling VC.

"Brands and sponsors are flooding the esports industry, but are still struggling to prove return on investment in order to justify marketing spend. Until now, this was next to impossible within the esports ecosystem," says Johannes Waldstein, founder & CEO of FanAI. "FanAI unlocks the value for our esports clients by providing unique purchase behavior and lifestyle data on their fanbase, opening the doors for sponsors and brands to invest with confidence."

Top esports teams such as Cloud9, OpTic Gaming, Overwatch League's LA Valiant and NYXL, and Cavs Legion GC - the Cleveland Cavaliers' NBA2K League team - are already using the FanAI service to their benefit. The company says it will use the influx of funding to expand its product and data science teams and round out the client engagement structure needed to support the startup's further anticipated growth.

"As esports investments have grown by orders of magnitude, the sponsorship ecosystem remains an enormous and untapped opportunity. From teams and publishers to agencies and brands, the lucrative demographic of the gaming industry has sparked a lot of interest," says Deepen Parikh, Partner at Courtside Ventures. "Johannes and the FanAI team have created a rapidly growing and scalable platform that for the first time enables all parties in the ecosystem to apply actionable data and measurement to their purchasing decisions."

Published on: Feb 23, 2018