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Business of Esports Minute 013 – Unity IPO, Corsair IPO, Razer Performance

A week of news covering the intersection of business and gaming / esports, all in about one minute – everything you need to know from the “profit of esports” himself.

013 – August 30, 2020

From the keyboard to the boardroom, this is the Business of Esports Minute! Every single week, I, Paul Dawalibi, the prophet of esports, will be bringing you my hottest takes from the week, basically everything you need to know about the business of esports all in about one minute. Let’s go.

The public market activity is red hot this week. Let’s start with Unity who filed their S-1 this week, in anticipation of their IPO and listing on the NY Stock Exchange under the symbol “U”. Unity claims that in 2019, over half of the top games on mobile, PC and consoles were made with Unity. They generated $542M of revenue in 2019, and are currently sitting on $453M in cash. The company has never been profitable, but losses have narrowed this year. The IPO has not yet been priced, but the last private round valued Unity at $6B over a year ago. It wouldn’t be surprising to see Unity get closer to Epic’s $17B valuation. It’s interesting that if you take out Epic’s Fortnite revenue, and compare just engine vs engine, the two companies are almost the same size. The timing of this S-1 filing is also interesting given all of the mess that Epic finds themself in. Maybe Unity saw this as the opportune time to really stand out. In the end, the biggest winner in this IPO will of course be Sequoia Capital, who owns a quarter of Unity today.

In other IPO news, Corsair filed to go public this week as well. The company generated a billion dollars in revenue last year and commands 18% of the US market for gaming peripherals and 42% of gaming PC components. They intend to list on the NASDAQ under the symbol CRSR and plan to raise $100M in the IPO. Their SEC filing noted that there’s approximately 524M PC gamers. Out of those, 94M spent over $1000 on their PC and 27M spent over $1800, with total global demand for PC gaming and streaming gear hitting $36B in 2019. NY-based private equity firm EagleTree owns about 92% of Corsair and will continue to be majority owner after the upcoming IPO, when the company should easily be valued over $1B. 

Finally, another public gaming company was in the news this week when Razer unveiled record high revenue of $447M, representing 25% year on year growth. Razer is listed in HK and is currently valued at almost $2B. The company arguably started the entire gaming peripherals industry and today is sitting on $500M of cash with no debt. Like others in the space, they’ve seen a surge in growth during the pandemic. What is unique about Razer is they’ve started to diversify into areas that aren’t immediately gaming related. For example, they acquired a payments platform and later launched an e-wallet service called Razer Pay. By offering more services to their gamer fanbase, I’m optimistic for the future for the business. 

For far more detailed insight and discussion into the business of esports, as well as the most exceptional line-up of guests, please tune in every week to the Business of Esports podcast and every Wednesday evening into the Business of Esports after-show livestream. Also make sure to follow us on Twitter @bizesports and on YouTube at The Business of Esports. 

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