A new industry has emerged from the ashes of the 2020 pandemic. Both penny stocks and blue chips have started to reap the reward. The exciting part is that, unlike other “reopening stocks,” this new trend has only just begun to dig its cleats in. In this article, we’re looking at the emerging trend in esports. We’ll also discuss what’s happening in the industry. Plus, I’ll go over a few penny stocks to watch as M&A activity has grown prominence.
Esports & A New Trend That Can’t Go Unnoticed
Believe it or not, professional esports has been around for a while. Thanks to the global shutdown last year, its growth was amplified, however. For example, Newzoo, an industry analytics firm, explained that in 2015 just over 800,000 people had even heard of esports. Fast-forward a few years, and Newzoo finds that nearly 2 billion people are well aware of the industry. More than 600 million encompass the “active live streaming” audience.
You also can’t ignore that Newzoo expects the industry to reach $1.8 billion by next year. Thanks to these stats, it’s no wonder that top celebrities and professional athletes are grabbing a stake in this niche. Everyone from Michael Jordan and David Beckham to Will Smith and Drake is throwing their hats into the ring right now.
Esports Penny Stocks To Watch
- Alpha Esports Tech Inc. (CSE:ALPA) (OTC:APETF)
- FansUnite Entertainment Inc. (CSE: FANS)(OTC: FUNFF)
- Super League Gaming (NASDAQ: SLGG)
Alpha Esports Tech Inc. (CSE:ALPA) (OTC:APETF)
One of the newer companies on this list of penny stocks is Alpha Esports. It made its public debut earlier in the year and since then has put a more significant focus on building partnerships and strong working relationships. Alpha’s model leverages its GamerzArena platform to build upon a userbase of both novice and professional games, taking full advantage of the popularity of Esports. According to the company, GamerzArena boasts over 100,000 active users and a rapidly evolving ecosystem.
New partnerships have become a driving force for Alpha aside from members’ eligibility to become GamerzArena+ members (at $12.99/ month per member). The company has explained that its relationship includes names like The New Jersey Devils, Barstool Sports, ESPN Radio, Notre Dame, Syracuse University, & Penn State, among others.
What To Watch With Alpha Esports
Most recently, Alpha became the Official Online Gaming Portal of Nets Gaming Crew, the NBA 2K League affiliate of the Brooklyn Nets. NetsGC and Alpha will team up to host two esports tournaments on the GamerzArena platform – one for high schoolers and one for college students, just for starters.
This became the latest on a long list of deals that Alpha has been part of since going public. Each deal has further expanded its reach and access to new users. This week, Alpha inked an agreement with Esports Entertainment Group (NASDAQ:GMBL) subsidiary, EEG Labs, to develop a new computer vision tech system. The tech will simplify match scoring and allow GamerzArena to detect fraud, including falsified game outcomes. Magnus Leppaniemi, President of EEG Games, explained, “In working together, we will pave the way for ground-breaking and efficient scoring of esports match results, allowing gamers everywhere to compete safely and reliably.”
With countless deals in the books and progress being made via its GamerzArena platform, Alpha could be one of the Esports penny stocks to watch as the industry grows.
FansUnite Entertainment Inc. (CSE: FANS)(OTC: FUNFF)
Another one of the esports penny stocks gaining momentum later in the year is FansUnite. The company offers technology that is specific to gaming and entertainment. Unlike Alpha, FansUnite has put a more significant focus on the iGaming (sports betting) side of the token in Esports.
In particular, its VamosGG is an esports-first sportsbook and casino site. It was created on the company’s Chameleon platform to explicitly service the esports betting market in Brazil. This is also one of the fastest-growing regions for esports betting globally.
What To Watch With FansUnite
When you think about emerging industries like this, you can’t ignore the entire ecosystem. Similar to Alpha, FansUnite goes beyond an event-only business model. Where Alpha focuses on building an active user base, Fans develops platforms for viewers to wager on this emerging sport.
Last month the company was granted UK gambling licenses for B2C and B2B businesses. Fans also inked a new deal with multiple data providers for its Chameleon B2B platform. This includes agreements with Pariplay, Sports IQ, Pythia Sports, and Algosport. In particular, Algosport became one of the first providers to offer Bet Builder products for games like FIFA 2021. Coincidentally, Electronic Arts (NASDAQ:EA) recently expanded its EA Sports FIFA 22 Esports program last month. Focusing on events like this, will FansUnite hit watch lists for esports stock traders in October?
Super League Gaming (NASDAQ: SLGG)
Shares of Super League recently caught a spark thanks to new M&A headlines. The company specializes in video game and esports experiences, with the last few weeks being some of the most active Super League. In particular, the company has struck several partnerships (including its latest acquisition), which have raised eyebrows during the quarter.
What To Watch With Super League
Toward the end of September, the company struck what it called a first-of-its-kind esports events production partnership. Super League and Production Resource Group, an event production solution company, formed a partnership. This new partnership provides event support to the esports community.
“Together, Super League and PRG can leverage our diverse strengths and networks to push past current boundaries of the esports event fan experience…With PRG’s global network of locations and resources, Super League can now activate anywhere at scale,” explained Matt Edelman, Chief Commercial Officer, Super League.
Following this, Super League filed an 8-K this week, showing that it quired ad platform Bloxbiz. Why could this be important for Super League? According to the company, Bloxbiz’s platform reaches more than 25 million monthly active Roblox users across more than 75 games. This deal allows Super League to execute plans to extend its reach into the metaverse and appeal to a broader audience, according to Ann Hand, Chairman, and CEO of Super League.
Esports Stocks To Watch This Month
Where attention could be on broader markets, there’s something to be said about particular niches rapidly emerging. Thanks to the expected growth in esports, there are plenty of people watching. This pool of onlookers includes many more than just retail investors. With the potential growth expected from firms like Newzoo, this could be an exciting area of the stock market to watch as things continue materializing.
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