UK-based esports orgs and businesses raised a record £42m in funding in 2020 according to new report

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UK-based esports organisations, startups and scaleup companies raised £42m in 2020, making it a record year for UK esports startups in terms of both the value and number of deals. 

That’s according to new research published this week by Here East, the tech and innovation campus in London, and Beauhurst, a UK database for fast-growth companies. The pair claim to have analysed all investment data for British esports since 2011.

Growing UK esports businesses have raised £138m over the last ten years, and the research has found that 61% (£85m) of that investment was secured in the last two years. And 45% of the total funding rounds (97) also took place in the last two years. 

The levels of esports funding in 2020 broke the record set in the previous year, when UK esports startups raised £27m across 18 funding rounds.  This momentum has continued into 2021, with eight deals worth £15m already being secured. 

“The number of esports startups securing investment for the first time is highly encouraging, suggesting investors see real long-term growth potential in esports and are willing to back early stage businesses in the sector.”

Henry Whorwood, Beauhurst

The research states that 95% of all funding into UK esports startups was secured since 2015.

The research has identified 43 fast-growth UK esports startups and scaleups, with 67% based in London. 

The most successful UK-based esports scaleup is Fnatic, which has raised £51m across seven funding rounds with the backing of investors such as Beringea and Crowdcube. FACEIT is the second most successful UK-based esports scaleup in terms of investment, having attracted £22m, followed by Guild Esports, which raised £20m in 2020. 

45% of the funding rounds over the last two years were secured by startups that had never previously raised investment. 

Esports betting has also been an area that various betting providers have attempted to crack in recent years, some of which have been backed with solid levels of investment, and there are online casino providers too.

Top 10 UK-based esports businesses by funding raised:

  1. Fnatic: £51m
  2. FACEIT: £22m
  3. Guild Esports: £20m
  4. Ginx TV: £9.9m
  5. Midnite: £6m
  6. Stakester: £2m
  7. Platform: £1.7m
  8. Edge: £1.6m
  9. BUFF: £1.5m
  10. Puntt: £1.1m

Earlier this year, Here East (pictured below) released a new initiative alongside the London Legacy Development Corporation (LLDC) and Arena Consulting to create a ‘world-class’ esports cluster at Queen Elizabeth Olympic Park

Gavin Poole, CEO of Here East, commented: “Two record breaking years for British esports startup and scaleup investment is just the start of what will be a new age for British esports. The scale of investment starting to enter British esports startups will accelerate the growth of esports teams, venues and production companies across the country. Combining the UK’s world-class expertise in tech, gaming and creative industries, I am confident that London can become a global capital for esports innovation.”

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Henry Whorwood, head of research at Beauhurst, added: “The data shows that fast growth esports businesses in the UK took eight years to secure the same amount to investment they have secured in the last 24 months. It’s clear the sector is experiencing exponential growth and demonstrating remarkable resilience during the challenges posed by the global health pandemic.

“The number of esports startups securing investment for the first time is also highly encouraging, suggesting investors see real long-term growth potential in esports and are willing to back early stage businesses in the sector.”

Here East says ‘esports has grown rapidly across the campus and across the Olympic Park’ and that ‘there is a huge opportunity for esports to become a defining sector for the UK over the next decade, driving job creation, innovation and investment in the country’s economic recovery’.

Here East, which is owned by clients of Delancey, has tenants including BT Sport, Sports Interactive, Bidstack and Staffordshire University, which offered the first undergraduate esports course in the country. Esports competitions have also taken place at the Copper Box on Queen Elizabeth Olympic Park, including the 2017 Clash Royale Crown Championship and Rocket League World Championship 2018 finals.

London’s Here East complex is also hosting UK esports festival Stack Fest in September 2021.

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