If you are looking for exposure to the mobile esports world, then Skillz Inc. could be your way in.
In terms of the mobile esports world, Skillz Inc. made its mark this week with a 29% stock increase that amounts to $22.73 following a deal with a special-purpose acquisition company that allowed it to go public.
Skillz allows 2.7 million players per month to compete with others on their mobile phones for points or rewards in games such as Solitaire Cube or Blackout Bingo. Approximately 1,700 tournaments are run per second.
The Jump
Small-to-midsize game developers make money without having to sell to big companies with Skillz. Gamers can use a trustly gaming guide to find an assortment of tournaments. When reaching those tourneys, Skillz takes away the ad promotions. However, consumers must pay tournament feeds and Skillz receives about 14% of the cut. With Skillz now going public, the developers don’t have to worry about the financial worries anymore because the brand will now make money off brand-sponsored advertising.
What allowed Skillz to go public was a blank-check company named Flying Eagle Acquisition Corp. Other investors included Wellington Management, Fidelity Management & Research, Franklin Templeton, and Neuberger Berman.
Potential Growth
For those participating in the iGaming and sports wagering industries, total addressable markets (TAM) is relevant because it mainly revolves around states legalizing those activities. In terms of Skillz’s relevance, it is primed for exponential growth because its platform is currently home to just 2.7 billion mobile gamers and 10 million developers in the world. The company believes that the market will double in value to $150 billion by 2025. That number would surpass even the highest estimates for US internet sports betting and casinos.
When it comes to mobile gaming, international markets are growing four times as fast as North America. However, Skillz generates less than 10% of its revenue from regions outside of North America. The company can likely capitalize on those growth adventures because it’s in a good spot financially. When all was said and done, the market came to $250 million in cash with no depth after landing $158.5 million from all four investors.
More About Flying Eagle Acquisition
FEA is the sixth investment vehicle founded by Sloan and Sagansky. Having raised $690 million, it makes it the largest to date. Sloan and Sagansky have been busy this year, having reached a deal in April with online sports betting titan DraftKings to become a public company following the merger with SBTech and Diamond Eagle Acquisition Corp.
In March, Sloan and Sagansky launched FEA with a $600 million initial public offering. Sloan served as chairman and CEO of MGM from 2005 to 2009. He was also the founder, chairman, and CEO of SBS Broadcasting, which is Europe’s second-biggest broadcaster. Sagansky worked for 30 years in show business, once serving as the president of CBS Entertainment from 1990 to 1994.
