Media, Entertainment and Sport

How does the value of esports companies compare with regular sports teams?

Image of people playing an esports game

The world’s largest esports companies are valued at almost half-a-billion dollars. Image: Unsplash/JESHOOTS.COM

Omri Wallach
Writer, Visual Capitalist
Share:
Our Impact
What's the World Economic Forum doing to accelerate action on Media, Entertainment and Sport?
The Big Picture
Explore and monitor how Media, Entertainment and Sport is affecting economies, industries and global issues
A hand holding a looking glass by a lake
Crowdsource Innovation
Get involved with our crowdsourced digital platform to deliver impact at scale
Stay up to date:

Media, Entertainment and Sport

  • While competitive gaming is growing quickly, esports are still worth significantly less than traditional sports.
  • By 2020, four of the top 10 esports companies were valued at more than $300 million.
  • In 2018, only one esports company was worth this much.
  • As time progresses, esports are expected to mature, increase in value and become more comparable to traditional sports.
A visualization to show how esports companies compare in value with the big leagues
Esports have significant value, but to catch up with the big leagues there is still a long way left to go. Image: Visual Capitalist

How do esports companies compare with sports teams?

Are esports on the same level as “real” sports? These comparisons range from tricky to subjective, but the monetary value of companies speak for themselves.

The world’s largest esports companies have definitely risen to the occasion. Valued at almost half-a-billion dollars, they’ve started to pass some sports franchises in value.

In the above graphic, we compare Forbes’ valuation of the top 10 esports companies in 2020 against median franchises in the “Big Four” major leagues (NFL, MLB, NBA, and NHL). Despite competitive gaming’s rapid growth, there’s still a long way left to go.

Have you read?

Esports impress but NFL teams reign supreme

The world’s top esports companies have grown quickly, and impressively.

As of 2018, there was only one esports company worth more than $300 million in valuation. By 2020, four of the top 10 were valued at more than $300 million.

A table to show the value of the top ten esports companies in 2020
The world's top esports companies have grown at an impressive rate. Image: Visual Capitalist

When compared to traditional sports valuations, esports companies have already reached major league hockey status.

TSM, the world’s most valuable esports company in 2020, has a higher valuation than five NHL franchises. In fact, four esports companies were estimated to be more valuable than two NHL franchises, the Florida Panthers and Arizona Coyotes.

But other sports leagues are further away. While the median value of an NHL franchise in 2020 was $520 million, the MLB, NBA, and NFL all saw median values of over $1.6 billion.

A table to show esports vs sports franchises and their values
The revenue streams for esports companies are extremely varied. Image: Visual Capitalist

Differences in esports vs sports structures and growth

Try as we might to make a clean apples-to-apples comparison between esports and traditional sports teams, there are significant differences in the business models to consider.

For starters, major esports companies own multiple franchises and non-franchise teams across many games. Cloud9 owns both the eponymous Cloud9 League of Legends franchise and the London Spitfire Overwatch franchise, for example, as well as non-franchise teams in Halo, Counter Strike: Global Offensive, Fortnite, and other games.

The revenue streams for esports companies are also extremely varied. Companies like TSM, 100 Thieves, FaZe Clan and Enthusiast Gaming made 50% or more of their revenue from outside of esports, having instead expanded into diverse companies with an equal focus on content creation and apps.

But it’s this greater ability to diversify, and the still-increasing size of esports fandom, that continues to grow esports valuations. In fact, TSM’s estimated 2020 revenue of $45 million is less than half of the Arizona Coyotes’ estimated revenue of $95 million, despite a $100+ million valuation difference in favor of TSM.

That’s why the continued maturation of esports is only going to make traditional sports comparisons easier, and closer. Instead of having to pit companies against franchises, direct league-to-league comparisons will be possible, and the differences will likely shrink from billions to millions.

Don't miss any update on this topic

Create a free account and access your personalized content collection with our latest publications and analyses.

Sign up for free

License and Republishing

World Economic Forum articles may be republished in accordance with the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International Public License, and in accordance with our Terms of Use.

The views expressed in this article are those of the author alone and not the World Economic Forum.

Related topics:
Media, Entertainment and SportArts and Culture
Share:
World Economic Forum logo
Global Agenda

The Agenda Weekly

A weekly update of the most important issues driving the global agenda

Subscribe today

You can unsubscribe at any time using the link in our emails. For more details, review our privacy policy.

Social media in the crossfire: This is how you establish 'digital trust'

Kate Whiting

February 20, 2024

About Us

Events

Media

Partners & Members

  • Join Us

Language Editions

Privacy Policy & Terms of Service

© 2024 World Economic Forum