Lightspeed Raises USD$4.2bn Fund Trio; Esports Entertainment Group in USD$8.4m IPO

Lightspeed Venture PartnersLightspeed Venture Partners

TheGamingEconomy’s Daily Digest brings you the prevalent business stories in gaming. In today’s news: Lightspeed raises USD$4.2bn (£3.3bn) fund trio; Esports Entertainment Group in USD$8.4m (£6.7m) IPO; and SIE announces USD$10m (£7.9m) development fund.

Lightspeed raises USD$4.2bn (£3.3bn) fund trio

California-based VC firm Lightspeed Venture Partners has announced that it has raised a trio of investment funds, which combined are worth in excess of USD$4.2bn (£3.3bn). These comprise of a USD$890m early-stage fund, termed Lightspeed Venture Partners XIII LP; a USD$1.83bn (£1.45bn) tranche used to support existing portfolio companies as well as identify new investment opportunities, which will operate under the Lightspeed Venture Partners Select IV LP banner; and the USD$1.5bn (£1.2bn) Lightspeed Opportunity Fund LP, which will support firms in global territories.

Lightspeed's most recent investments in the video games industry include contributions to a USD$2m (£1.6m) seed round in streaming platform Rheo TV in January, and supporting a USD$20m (£15.9m) round in interactive content firm Solve HQ in December. Previous investments by the VC firm in the space include Epic Games, Kixeye, Kongregate, Playdom, and Serious Business.

In a press statement, Ravi Mhatre, Partner at Lightspeed, commented, "Our global portfolio which spans China, India, Southeast Asia, Europe and the US gives us a view on everything that affects startups, ranging from early regional economic trends, to spotting similar opportunities to serve consumers, small businesses and enterprises seeking new, innovative product needs across geographies. Having global expertise is no longer a nice to have, but a must have if you want to support exceptional entrepreneurs with the ambition to win in their market at any point on their founder journey. Our focus remains the same today as it was in the beginning in 2000 - to invest in outlier founders and innovators building enduring companies across the globe.”

Esports Entertainment Group in USD$8.4m (£6.7m) IPO

Esports Entertainment Group

Online gambling firm Esports Entertainment Group Inc. has announced its initial public offering on the Nasdaq Capital Market of 1,980,000 units of common, unit A, and unit B warrants, priced at USD$4.25 (£3.38) per unit. The Malta-based firm, which specialises in wagering on global esports events through the Vie.gg betting platform, becomes the first online gambling (iGaming) firm to list on the exchange, with the IPO expected to raise approximately USD$8.4m (£6.7m) for the company. The listing will be used to support Esports Entertainment Group's "aggressive rollup M&A strategy", with a letter of intent for the first targeted acquiree, which generates annual revenue in the region of USD$12m (£9.5m), already purportedly signed by the firm.

While the global esports market is expected to generate USD$1.1bn (£874m) in revenue through 2020, Esports Entertainment Group forecasts this will be surpassed several times over by funds generated through esports betting, expected to be in the region of USD$23bn (£18.3bn) this year according to an investment document supplied to TheGamingEconomy.

At the close of trading, Esports Entertainment Group Inc. (NASDAQ: GMBL) closed at USD$2.85 (£2.26) per share, down 16.18%.

SIE announces USD$10m (£7.9m) development fund

SIE Logo

Sony Interactive Entertainment (SIE) has announced the launch of its Play at Home Initiative in response to the Covid-19 pandemic, which will see the company fund independent developers to the tune of USD$10m (£7.9m). Further details are expected to be announced at a later date, however at this stage it is unclear whether funding would be contingent on studios ensuring exclusivity to the PlayStation platform, or would be in return for significant proportions of equity.

In a blog post, SIE President and CEO Jim Ryan wrote, "Independent developers are vital to the heart and soul of the gaming community and we understand the hardships and financial struggles that many smaller gaming studios are facing[...] During these days of physical distancing, fans have turned to gaming for moments of respite and enjoyment. At Sony Interactive Entertainment, we are privileged to bring this much-needed entertainment. We know this is just one small step and we are thankful to be able to offer this support to our players, our communities, and our partners."