The Hype Around Esports Is Fading as Investors and Sponsors Dry Up
The ad market is shrinking, crypto is in freefall and venture capitalists want to see profits
A PUBG video game during the Esports Championships East Asia in Seoul, South Korea, in 2021.
Photographer: SeongJoon Cho/BloombergThe once-thriving esports industry has fallen on hard times as funding sources dwindle and signs abound that athletic competition via video games doesn’t have anywhere near the earning potential investors anticipated.
Sports-business billionaires and gaming executives had hopes that esports could one day could scale into an organization like the National Basketball Association. But after a boom five years ago, several prominent esports teams and organizations, particularly in the US, are contracting, the result of a broad economic downturn, a venture capital industry that’s no longer willing to accept growth without profits and a crypto meltdown that has undercut a significant source of backing.