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Esports keeps the lights on at Eden Park during international sport shutdown

AUCKLAND, NEW ZEALAND - OCTOBER 07: An aerial view of Eden Park on October 7, 2011 in Auckland, New Zealand. (Photo by David Rogers/Getty Images)

  • New esports hub will make Eden Park the home of New Zealand esports
  • Deal struck between venue and Guinevere Capital part of wider model
  • Guinevere aiming to build bridges between international sport venues and esports

David Harris, founder and managing director at private equity firm Guinevere Capital, didn’t set out to be an ‘esports guy’. After a two-year stint in the marketing department of Australia’s National Rugby League and a prior career in physiotherapy in professional football and cricket, Harris created Guinevere in 2016 with the objective of investing in the traditional sports space.

In a roundabout way, that’s exactly what he’s doing.

Harris and his colleagues at Guinevere have been building bridges between digital and physical sport since 2017. By that point, Guinevere had moved away from traditional sport and taken a majority stake in Australian esports organisation Dire Wolves. Guinevere wanted to create a prestigious physical headquarters in which the team could practice, play and create content.

Harris identified international cricket and rugby stadiums as the perfect potential hosts. By pitching the benefits of hosting an esports team year-round, Guinevere was able to secure prime real estate at the Sydney Cricket Ground for the Esports High Performance Centre in 2017, occupied by Dire Wolves and several other esports teams to this day.

From a Dire Wolves perspective, the prestige of operating out of an iconic traditional sports venue attracts plenty of new business and opens doors with blue-chip brands. From an SCG perspective, it provided additional income and a modern twist to a host that principally trades on its history.

Guinevere has used this deal as proof of concept ever since, concluding similar deals to host other esports teams in its portfolio at major international sports venues.

In 2018, Guinevere finalised a deal to set up XLHQ, a practice and studio space used by League of Legends team Excel Esports [in which Guinevere holds a minority stake] at Twickenham, the home of English rugby.

Now, shortly after New Zealand’s emergence from the Covid-19 crisis, the private equity company has finalised a deal to establish another Esports High Performance Centre at Eden Park, the biggest multi-purpose stadium in the country.

(Michal Konkol/Riot Games via Getty Images)

Talks between Guinevere and Eden Park began 12 months ago and although they were disrupted by the pandemic, New Zealand’s impressive handling of the virus meant the country’s economy has been able to return to normal well before other major markets.

However, international sport is still in a state of limbo after New Zealand took the decision to close its borders indefinitely. And Harris believes the crisis facing international sport – particularly in New Zealand – was an accelerant for the deal’s completion.

“I think the Covid-19 crisis has highlighted the need for traditional sports to diversify,” he says. “Our entire business philosophy is themed on the shift from traditional sports to esports; from linear broadcast to digital distribution; from in-person communities to digital communities. Covid-19 has just fast-tracked that.

“My view is that these facilities [traditional sports stadiums] are underutilised for much of the year, so it just makes sense to bring a new demographic to a traditional sports venue while leveraging the existing infrastructure. We feel these facilities provide great sustainability for esports and we are helping assist the sustainability of their traditional business as well.”

SportBusiness understands Guinevere will not pay to rent the space at Eden Park. Instead, there will be a revenue share agreement between the two parties covering all monies generated by events, further rental of the space and a naming rights agreement to be announced shortly.

While New Zealand’s borders are closed, Eden Park must alternative ways to generate revenue (Phil Walter/Getty Images)

From the ground up

By locating its headquarters at an iconic rugby stadium, Excel Esports was able to project an aura of professionalism and excellence while in discussions with telco BT around a sponsorship deal in 2019. BT became Excel’s lead partner in January this year, offering the team financial security in the short and medium term.

At Eden Park, the model is being scaled up. Unlike Guinevere’s first two performance centres at the SCG and Twickenham, the EHPC at Eden Park’s primary function is to serve as a hub for New Zealand’s entire esports industry, rather than to be the headquarters of a specific team. While Dire Wolves and other teams advised by Guinevere will use the facility, the space will be open for use by grassroots esports event promoters and organisations.

“It’s great to have this esports hub with which investors, sponsors and community groups can rally around,” Harris says. “For people who aren’t from within the esports industry, it’s great to provide something they can touch and feel familiar with like a traditional sports stadium. To have that point of reference makes it easier for them.”

After taking on majority ownership of Dire Wolves earlier this year, NZ native Jason Spiller believes the new facility will provide the perfect environment for grassroots players and teams to improve and go professional in greater numbers than at present.

“There is a huge jump from playing in a solo queue [playing online games casually] to being talent scouted for a professional team,” Spiller says. “A facility like this one at Eden Park creates a stepping stone. We can encourage esports organisations to use this facility and create a pathway for Kiwi gamers to enter the global esports scene.”

Spiller’s takeover of Dire Wolves and the creation of a performance centre are not coincidental. Dire Wolves has recently expanded via the acquisition of two other esports teams: Overwatch side Sydney Drop Bears and N8, a team that focuses on sports simulation games such as FIFA and NBA 2K.

The facility at Eden Park will provide a central venue for Dire Wolves’ talent scouting in New Zealand and gives the organisation a second base of operations.

“It allows for an easier workflow for our teams, not just from a team perspective but a content perspective,” Spiller says. “In order to attract eyeballs you need to be producing content, and we’re in a tremendously advantageous position to be able to have all of that happen in one place.”

While Guinevere gave up its majority stake in Dire Wolves earlier this year due to rules put in place by League of Legends developer Riot Games that prevent multiple top-tier League of Legends teams being majority owned by the same company, the new performance centre will help deepen its connections with the traditional sports industry and boost the esports industry in Oceania, where it acts as a service provider and adviser to teams and organisations.

“We’re building a narrative and these facilities are part of that narrative. I think they’re indicative of the professionalism we’re bringing to our esports operation and I firmly believe that they help the value proposition for sponsors, investors and players.”

Instilling a culture of professionalism from within is particularly important for an esports organisation situated thousands of miles away from other major esports markets and teams.

Due to its geographical isolation, Australia and New Zealand’s gaming and esports scene is largely self-contained, mainly because the latency between players in those two countries and game servers in Asia, Europe and North America is too great for reliable competition.

Spiller hopes that once the Covid-19 crisis is over, the esports hub at Eden Park will attract high level competition to New Zealand for one-off matches and tournaments.

“Having a facility like this is the first step,” he says. “I foresee a world in which New Zealand and Auckland could host the League of Legends World Championships, or The International.”

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