Not everyone with a passion for video games wants to become an esports athlete. In fact, many gamers channel their efforts into behind-the-scenes roles. There’s the developer community responsible for creating the games themselves, along with coaches and support roles that quietly champion teams as they soar to the top of the S-Tier rankings. The esports sector is exploding in popularity, with the industry estimated to be worth more than $1.6 billion by 2024. Unsurprisingly, tournament organization and management are becoming a lucrative career prospects for many gaming enthusiasts. However, while the appetite for esports is there, putting on a show isn’t as easy as you might think.
How Lucrative Are Esports Tournaments?
Even the most modest of tournaments cost tens of thousands to run. If you want to secure a major venue and attract top-tier talent, you can easily add a few zeros to your budget sheet. Just because you’ve picked a popular game, found a big-capacity venue, and locked down a healthy prize pool doesn’t mean you have a hit on your hands. In fact, many tournaments don’t run at a profit. At least not in their inaugural year. Ultimately, you need to be thinking about the picture. Below, we’ll explore some of the key costs to consider when hosting an event for the first time.
Prize Pools
This is arguably the most important cost you’ll have to consider. Without a generous prize pool, you stand no chance of attracting established teams and top-tier talent. In the early days of esports, tournament winnings rarely soared past the six-figure mark. Today, it’s all changed. The Invitational leads the way when it comes to prize money. In 2021, competing teams fought it out for a share of a $40 million prize pool. The good news for tournament organizers is that the most successful teams don’t rely on prize money to keep them afloat. It’s often brand sponsorship deals that keep a team ticking over between tournaments.
Venue Hire and Travel Costs
The cost of hiring a venue for an esports tournament can be significant. Even if you’re hosting a smaller event with a capacity of less than a thousand, you’ll still have to cover utilities. All that essential tech is going to require a lot of power. Most venues aren’t going to be prepared to absorb that expense. What’s more, you’ll have high-speed broadband connections as standard. While a location might promise such connectivity, any self-respecting organizer will want to test connections to see if they’re fit for purpose.
Next, you’ll need to think about the costs of actually getting teams to the event. Outgoings are going to vary here. If you’re organizing an event for charity, teams might be prepared to cover travel costs themselves. However, it’s pretty standard for organizers to take care of things like accommodation and catering for participating teams and their support crews. While organizers can make a saving by striking deals with local hotels, accommodation costs for a two-day event can easily soar past the $40,000 mark.
Equipment Hire
Many teams will want to bring their own equipment to a tournament. However, you’ll need to be clear about what’s allowed and what’s prohibited. Many major tournaments are pretty strict about what peripheral teams can bring to a competition. If competitors are arriving with their own hardware, it’ll need to be assessed to ensure fair play. However, beyond computers and gaming peripherals, there’s a lot of equipment you’ll need to provide. You’ll need screens in place so spectators can follow the action. An audio system will also need to be installed if you’re bringing commentators into the mix.
Personnel Costs
Staffing an esports event can be incredibly expensive. However, overall costs vary depending on the scope of your tournament. At a minimum, you’ll want an event manager in place to oversee the day-to-day operation of the tournament. You’ll also need technical teams in place if you’re broadcasting coverage online. If an event has been marketed to international audiences, translators will also need to be hired. Then you’ve got to factor in social media managers, photographers, security staff, and more.
How to Finance an Esports Tournament?
Thinking about staging an esports event for the first time? Unless you have extensive connections within the industry, you’re going to struggle to secure sponsorship from any major sources. Ticket prices can go a long way in financing an event, but you’ll still need to have invested in pre-production and promotion before these tickets can even go on sale. Rather than leap directly to a live event, consider staging a virtual tournament first. This way, you’ll establish a presence within the industry, making it easier to attract brand partners when you do decide to take a tournament offline for the first time. Need some ideas to help you put together an engaging esports event? Check out the latest Dota 2 tournament schedule here.
