Gfinity needs more cash to build its UK eSports empire
Although demand for eSports continues to rise every day, helped by Twitch and YouTube, making money from competitive gaming can be hard (unless you're a successful player). It's a struggle that UK eSports events company Gfinity knows all too well after it revealed it lost £3.6 million in its first full year. Given that the company invested heavily in getting its business off the ground, which includes the launch of the UK's first dedicated arena, the loss doesn't come as a surprise, but it does highlight the need to quickly convert its growing audience into paying customers.
In the report, Gfinity CEO Neville Upton admits the company has "generated relatively low sales to date," and that while he says that won't change massively in the near future, the company does expect to boost its revenue next year. The company earned £560,828 over the last 12 months, up 163 percent from 2014, thanks to a mixture of sponsorship deals, game publisher fees, premium website subscriptions and ticket sales.
After starting with 43,000 registered users in June 2014, Gfinity counted more than 400,000 users at the time of its latest report. Now it intends to "maximise growth of its user base and consolidate its reputation for delivering the highest quality eSports events." That means putting more bums on seats at the Gfinity Arena and generating more money from partnerships and its new online retail store that will open in the coming weeks. With discussions already taking place over the sponsorship of the 2016 Championship series, Gfinity believes its current slowdown will eventually develop into long-term profitability.
To ensure that happens, though, it needs more money. After raising £3.5 million on the London Stock Exchange's AIM last year, Gfinity says it will soon raise another £1 million by offering more shares in the company. As far as the company is concerned, the plan is working, it's just not working fast enough. A cash injection could help remedy that problem, but more exposure from the likes of the BBC could also help convert young gamers into avid eSports followers.
