Boosting Esports Through Investments
A multitude of cars are kept by TejKohli at his Oxfordshire garage but his favourite is the Bugatti Veyron Grand Sports Vitesse roadster that costs about $2 million. It is only one of the 150 produced and the fastest roadster in the world with a speed of 258mph. It is the pinnacle of engineering ingenuity. While Kohli has undisputed affection for cars, he is also Europe’s biggest individual investor in eSports.
In 2018, Kohli has invested $100 million to Switzerland-based Rewired with €50 million allocated to eSports development. Since then, Rewired Esports Venture Fund arm has invested €34 million to Team Vitality, Europe’s leading eSports brand. However, Kohli has no direct involvement in Team Vitality; he simply wants to turn the investment into opportunities for young people to succeed within eSports.
The €34 million that was invested into Team Vitality was used by the Paris-based eSports team to build an impressive headquarters called V. Hive, a 10,700 square foot facility that features a streaming booth, gaming house, content production studio, WebTV studio, and offices. Aside from supporting its continuous growth, the funding will help in acquiring new players and launching a network of eSports academies.
Team Vitality has recently won the 2019 World Championship for Rocket League and the 7th season of the prestigious ECS Tournament for Counter-Strike: Global Offensive. It took 3rd place in the 2019 FIFA World Championship. It is the only one of the 10 European eSports teams in the League of Legends European Championship franchise.
The Rewired.GG funding was also used to expand Team Vitality to China and India. Kohli expects that his investment will achieve a twenty-fold ROI in eSports. If you will compare sports teams to eSports teams, the size of their audiences, and the current disparity in the monetization of fans, you will notice that eSports teams have a huge value that has to be unlocked.
The current monetization for an eSports fan is about $3.12 per fan compared to about $50 for NFL fans. According to Kohli, this represents a substantial upside as audiences and incomes are rapidly growing in contrast to current trends in most conventional sports. Kohli expects that eSports teams will be worth over a billion dollars in the next 5 years.
However, building an eSports brand will require huge amounts of funding and intellectual capital. Eventually, there will be few huge eSports businesses hoovering up the monetization and then a long line of smaller ventures will be competing for whatever is left. Kohli has invested in eSports because his philosophy is to identify future growth trends and then get in early by investing heavily in return for a substantial stake. He believes that to grow big, wealth must be created and impact the world.
On the other hand, not all of the investments of Tej Kohli are for profit. He has invested in biotechnology to help solve the blood shortage and organ donation crises all over the world. He has heavily invested in eradicating blindness in poor developing countries through corneal transplants. He has a long track record in addressing inequality, particularly among children.