Esport funding guide – 25 ideas for generating revenue in esports
Look locally first
Now you know your organization. You know where you want to go, why, how and when. You know how much money you need to accomplish your goals.
Let’s create revenue.
Unless you are a millionaire, a former world champion, or the former CEO of Google, you want to begin with creating revenue streams. You can find such revenue streams from local, regional and even national companies, grants, funds and partners.
Remember, depending on what your goals are, your efforts and partner-opportunities will be different. If you want to build a local esports organization with a local esports center and offer exciting esports activities for your local community – the opportunity for partnerships will be found locally, maybe regionally.
If you are building an esports organization to reach national or international fans/audiences, the opportunity for partnerships will be regional, national and maybe even international.
It is always a good idea to look locally to start. This is where you have your network, and your relationships. This is where people know you, and where you have earned credit and respect.
Consider the following:
- Do you know any local business owners that you can speak with about supporting your esports organization?
- Next: What local companies are existing sponsors of existing sports & athletic clubs? Meet them and understand why they do what they do. See if your organization can help them with their goals.
- Does the municipality or local government have funds or grants that support local activities for the esports team and/or the age range of kids etc.?
- Are there any local funds, e.g. banks, LIONS, Rotary or other organizations that would be interested in supporting your cause and goals?
- Are there any other funds or grants that can be used to support costs for the target audience of your esports organization?
It’s important that you have an overview of the gap between what you can cover of the budget and what you need from partners. Make sure you are ready with specific numbers for any donations and contributions and are also able to show the results from the contributions.
Create revenue: ideas
1) Fan club memberships
Offer memberships to your organizations. People, parents, fans will follow your organizations, cheer for you, and be part of them. Creating a club for members, where you offer premium content, streams, videos, tickets, merchandise or whatever you can develop – will secure membership revenue for your organization.
Look at the soccer club F.C. Barcelona for example, they offer a club for members for which they charge an annual fee: Source: https://bit.ly/2LNWt9o
I know you are not F.C. Barcelona, just use the same model on a smaller scale. 100 members paying 25 EUR per year, is still 2500 EUR per year.
Paying members can receive a welcome package:
- Membership card personalized with photo
- Club statutes Badge
- Welcome letter
- Personalized certificate
These elements are not expensive, but will make a huge difference for the member.
2) Subscription fees
If you have a local esports organization with an esports center that offers esports training and matches – you can offer subscriptions. The price of a contingent in an esports organization may vary a lot and often depends on where in the country your organization is housed and of course also of what the members get for the price. The price for the membership should reflect the benefits of membership and before your organization sets the rate, it should define what the members really get for their participation. If you have any doubts about what it should cost be a member of the organization, you can contact other sports clubs and learn from their expertise and experience.
Membership revenue naturally grows as the organization gets more members. To ensure additional membership revenue, it is a good idea to encourage coaches, leaders, parents and other interested parties to remain supporting members. Always make sure that each paying member “gets something back” and that it is an advantage for the individual to be member of the organization.
Create online or local esports events. Get partners to pay for the infrastructure and prize pool, and charge teams for participating in the tournament/event. By doing so, your organization can make revenue on ticket sales, sales of food and beverages and potentially from new memberships. Think about the events that have the greatest potential to become a success and thoroughly investigate in advance what events and activities the target audience demands. Prepare well before the arrangement, make a budget and tightly manage costs to make a profit.
4) Rent out esports facilities
If your organization has local esports facilities, you can rent them out.
Schools, educational institutions, youth clubs, companies, local health, and mental health centers, are examples of some of the possible “customers” that your organization can contact and possibly rent your premises and facilities.
For example, schools and educational institutions can use the premises for teaching in esports and gaming as electives while social psychiatry and special schools can use the facilities for training concentration, learning and cooperation. Before the organization starts renting premises and facilities, it is a good idea to contact the municipality and examine how a rental income will affect any local government subsidies if applicable.
Other ways to secure income with your esports facilities is to host viewing parties, BlizzCon events, “Burger, drinks and ESL Masters” and so on. Another option is to contact every single hotel and conference centers within a 30 km. area and offer your esports activities as fun experiences to guests. Contact every business in the region to offer your esports facilities as fun collegiate activities or activities at a Christmas party or other general events.
5) Media rights sales
If your club/team is good enough, you can qualify for or be invited to a tournament, where you can benefit from a share of the media rights. This is typically only for professional teams.
6) Merchandise sales
If your team or club develops a fan base, you can start offering fun and engaging merchandise. Do this, develop it with your fans, and they will buy it. No matter how big or small the club is.
Open an account on Twitch and start streaming/broadcasting your trainings and matches. If you can find great casters/commentators, you can build a fan base and start earning money from fans by bringing them engaging, fun and quality content. You can also stream meetings, events, and festivals as well.
If you have a dedicated video crew, you can start by creating a YouTube account and documenting the creation of the esports club. Later, you can create and post unique, creative content that will give you a platform to show your viewers what your club is all about, and thus create an audience.
9) Social Media
Like YouTube, the same goes for Snapchat, Facebook, Twitter, Instagram or any other social media platform. It is an avenue to engage in a fun, positive, creative and respectful way with your fans, and to grow your audience; an audience you can convert into revenue through membership sales, merch-sales, ads, events, eBooks, signed posters, etc. Just be relevant and creative, give your target audience more than they expect, and only be on a platform if you use it. It is counter intuitive to be on Twitter and send two tweets per year.
You have the opportunity to reach out to your community of fans and members to offer them a way of supporting your club/team, through crowdfunding. This can be organized through websites such as kickstarter.com where you can offer the fans merchandise, VIP services or other rewards in return for their support. You can also fundraise through monthly subscriptions with patreon.com where you can offer your patrons new content, videos, images, merch or other services, for their monthly support. Here is a guide: https://bit.ly/2d7LUed
11) Prize pools
Usually when an esports team or player wins money, the prize goes directly 100% to the player and team. Some teams split 10/90 or 30/70 with the organization or club.
When your Twitch and YouTube channels have enough fans watching, you can use ads to generate revenue from the media.
13) Affiliate programs
If you can build a website, email newsletter and/or social media channels with a large following, you can begin to use affiliate marketing to promote affiliate campaigns via your media, earning provisions from every sale made through your channels. “Amazon Associates” could be a place to start.
When you build an esports organization and offer your fans great content, great moments, and great experiences – some fans become ambassadors. The ambassadors will talk positively about your organization, promote your organization and they are most likely to offer donations to your organization, when you host different types of events. By adding a simple “Donate” option to your website and social media channels, you give your fans the opportunity to support the esports organization they love.
15) Simple partnerships
Create a “Wall of founders”, and offer every company or person, who pays a certain annual sum a spot on the wall. The “wall of founders”, can be a real physical wall with plaques, or made as an online graphic. A lot of local sports clubs do this and offer “your name on the wall”, for 100 euro/year for at least 3 years. Sell 30 partnership deals, and you have secured 3,000 euro/year in revenue from that wall. All you have to do is to send the partner a certificate as a PDF via email as reconnection.
You can find more inspiration here: https://bit.ly/2HjNirw
Secure relevant partnerships with companies and brands. Sometimes you can land a partnership on a money-deal, where the partner will pay you monetarily. Sometimes the partnership will be about services. For example, the partner will give you 10x new headsets that you can give to your players, or offer to your fans, as prizes in social media competitions. Sometimes, you can work out individual partner deals, such as a supermarket chain that offers fresh fruit to your players while they are at tournaments.
If you are a smaller, local or semi-pro esports organization, I would still suggest you begin talking to your local businesses, offering them courses, knowledge and value around digital marketing. Most of local businesses have issues with being great at digital marketing. One way to provide value is to invite them to your organization and assist them with their digital marketing issues. By offering local business value, you build relationships. In turn, from these relationships, their interest in supporting your organization will grow.
Apart from that, I would most definitely map out 250 or 500 local and regional businesses, that could invest in one of your esports partner packages, and start cold calling to book meetings and close contracts.
Types of partnerships
There are typically two types of partnerships: passive and active. It’s important to know and understand the difference when approaching companies.
A. The passive partnership
The passive partnership is the traditional type of partnership in sports clubs. An example could be the local plumbing company that has a logo on the player’s clothing or a sign on a computer or chair. They might support the club with 1,000 euro/year in return for advertising. It is an arrangement that is commonly used in the sports world where the partner achieves exposure, advertising and goodwill in return for the local sports organization receiving some financing.
B) The active partnership
In this partnership, the company is an active participant. For example, your esports organization might make an esports tournament and their partner will set up a “Just Dance” game and some dancers from the local dance academy/school on the day. They will help create a great atmosphere, while the partner contributes financially or alternatively pays tournament fees. There is activity from both parties in the partnership and the partnership is about activities where both you and the partner contribute.
An active partnership could also be for the exchange of services. For example, a local advertising agency could contribute by making Facebook ads and writing articles for social media. They could also offer to pay for the advertising and in return have their logo on your club’s shirts.
Another example of an active partnership is full partnership. We’ll take the example of “NorBank.” Let’s assume they pay for all of the equipment for the esports organization and in return they get their NorBank logo on the shirts and website of your team. Additionally, you create some articles and videos when setting up the new NorBank esports hall, which they help finance. Together you create recurring NorBank esports tournaments on the premises. It creates goodwill, publicity and exposure for the partner and the organization grows. But most importantly, the partnership fits both the organization and NorBank’s values and ideals: “supporting and developing the local community through good cultural, leisure and sports activities.”
An active partnership could also be a company paying for a video or series of videos where the esports organization includes product placements or interacts with the brand in other ways. The brand or business gains brand awareness and reaches new audiences through the esports organization and esports organization gets money.
17) Educate other players
If your esports organization has its own esports facilities (room / building and computers), you can invite the local youth to visit your facilities and participate in esports education once a week. You or one of your players/coaches, can offer a 90-minute speaking session about a topic, and local players and gamers can buy a ticket for 10 EUR to join the session. This can be done online as well.
20 participants, paying 10 EUR will be 200 EUR per week. If you hold just 10 sessions per year, you will generate 2,000 EUR in yearly revenue from these sessions.
18) Educate parents
Using the same model as above, you or someone in your organization, can host a weekly session for parents to understand “their gamer child”.
19) Educate companies
In general, esports organizations are usually really great at using social media, streaming and digital marketing to market themselves. Use that knowledge, and sell on location or online courses to companies, on “how to get great at digital marketing”. This works great for local companies, who are looking for inspiration in this field. This will also be a great way to meet and talk to potential partners.
20 participants paying 40 EUR will be 800 EUR per week. If you hold just 10 sessions per year, you will generate 8,000 EUR in yearly revenue from these sessions.
20) Help others
Look around in your local community, there will be sports clubs, schools, business or others, who are looking for help. Could be help on a Christmas fair, help with a summer party, or help with selling tickets to a lottery or an auction. Read local newspapers and be proactive in contacting local fairs, parties and other initiatives, usually it will be a way for you to earn money for your organization. If there are 10 people in your organization, you can earn even more by helping others out.
21) Local esports tournaments
Hosting local esports tournaments can be a revenue stream. If you or someone in your organization has the skills to host an esports tournament, you can contact local schools, high schools, universities, internet / gaming cafes, the local shopping center, libraries, tourist centers, or local businesses and invite everyone to your event.
“New Jersey Spring EsportsCup. Team up with your friends and compete to become the next New Jersey esports champion in games like: Fortnite, League of Legends, DOTA2, CS:GO and more!”
The above is just a quick example of how you can pitch your event to your community.
Create a simple website and manage the tournament/teams/players via Battlefy or Tournament and charge each team an inscription fee of 10 EUR. Work with a local school, internet-cafe or other facility that can provide the computers/consoles you will need for the tournament and contact local business and invite them to join the tournament as a team of colleagues to compete against other business in the city.
As prices for 1st, 2nd and 3rd places, you can design and print free certificates. You can also work with a local trophy and medals-company, who might want to sponsor trophies and medals for the tournament. Ask the local shopping center if they would be willing to offer a gift certificate to the winner.
You and your organization can design the local tournament as you want, but in the end, you will host an esports tournament involving the whole local community that is financed through participant’s fees. By doing this, you also show the local government, local businesses, hotels and conference centers that your organization can organize these types of tournaments and events – which might lead to more business for you.
If you stream this tournament, you can sell live partnerships for the streams. You can talk to local sports stores and invite them to do merchandise giveaways throughout the tournament.
You can of course offer local business to purchase advertisements to be displayed around the tournament facilities.
You can invite the local media to come to the event and invite them backstage to see what is going on! This is a great way to get free press coverage.
22) Lottery fundraising
Most countries have an opportunity for sports clubs and organizations to raise money with lottery sales. Sportsclublottery.com is one tool you can use. The basic idea is that your organization sells lottery tickets to your fans and local community, and through those sales, earns money for your organization. It is as simple as that. If there are 10 of you in your organization, selling 100 lottery tickets worth 5 euros each, you will generate 5,000 euros in revenue. Do this two times a year, and you will generate 10,000 euros in yearly revenue from lottery sales.
23) Content creation
Being in gaming and esports, we usually have skills in creating videos, articles, pictures, podcasts, streaming channels and other great content because we have played around with creating content for many years. For some of us, it was because we wanted to become big on YouTube or Twitch, for others because we wanted to become a great content creator.
If you or someone in your organization has skills in creating content, it could be a way to earn money. Maybe you can help local business, as mentioned before in the “educate” idea. Maybe you can serve as an agency, creating content for businesses social media? Maybe you can produce profile-videos of local business, or help them understand how they can use Instagram, Snapchat, Facebook or other social channels? Maybe you can write SEO articles for local businesses?
Maybe you can collaborate work with local businesses. Let’s say that a furniture store, needs new pictures and videos of their store. So you work with a local photographer – and together you create amazing photos, drone and in-store videos, you cut the videos and edit them, and in the end, you provide the furniture store with amazing new photos and videos – so they can promote their store.
You invite the photographer to the next business network event you host, so the photographer can meet new potential clients. Whenever you talk to businesses, keep in mind that if they need new photos or videos, you know a great photographer.
This way you help the furniture store. You help the photographer and you get paid from both the furniture store and the photographer for helping them out.
There are millions of ways to earn money from content creation: logo design, writing articles, graphic design, video, audio production, and animations. Creating collaborations, designing whole campaigns, working with streaming and social media. Imagine the local ice cream store, broadcasting live from their Facebook-page showing their amazing delicious ice cream, waffles and fruit, offering the first customer a free ice cream to begin the day!
As gamers and people of esports, we have many ideas and creative thoughts, we know technology, and we can use this combo to help businesses. Is that esports? No, but it is a way to make money, so you can do more activities for your esports organization.
24) Local media deal
Contact every local media outlet and offer them to do a weekly “Esports News” article for their print and online media. Nearly all of traditional omnibus media outlets know nothing about esports, and your esports column every week will bring new, interesting content to their media which will attract a new target audience (which they need). You can make a deal of one article per week for one year, or more. You can offer to do a podcast, a few videos, or join their sports section, to bring esports to them. The outlet will pay you for great content that will attract and/or engage readers and users.
25) Cut costs
Cutting costs is a great way to build a strong esports organization. Let’s say you have a few esports teams, and you need to travel to tournaments and are looking for a partner to cover these costs. Instead of closing a deal with an airline or hotel chain, you can plan the trip, and see if you can negotiate a discount on your travel and accommodation expenses. It would be awesome with a partner to cover all costs, but saving expenses is really important. Having one person dedicated to reduce costs, can for most organizations, be really helpful.
All in all, it is a good idea to look at your plans and list all the expenses for the current and following years, and see how these can be lowered. Usually, costs can be negotiated; all we have to do is try.