Converting crowds into cash: Brazil’s esports challenge

8 April 2019

Brazil has a huge and growing esports fan base. But it hasn’t been monetised as well as other regions. Joanne Christie talks to ESL Brazil’s Leo De Biase about how things are changing.

Brazil is famous for being football mad but the country’s passion for sports doesn’t end on the field – it’s also home to a huge number of esports fans. According to Newzoo, Brazil is the third largest esports market, behind China and the US.

The data provider puts the number of esports enthusiasts – those who watch professional content more than once a month – in the country at 7.6 million and says last year the total esports audience grew by more than 18%.

Unfortunately, while Brazil and the continent of Latin America more widely have an esports fan base that rivals Northern America, when it comes to revenues the two continents are worlds apart.

While North America generated revenues of US$345m (£262m) last year, equating to $15.80 per fan, in LatAm the respective figures were a much lower $31m and $2.00.

Revolution in revenues?
However, things are set to improve in this area, says Leo De Biase, CEO of ESL Brazil.

“We are already a very big and relevant market regarding viewership and regarding audience, but when it comes to revenue we are stuck in the 13th position so it is something that it reflects the economy and the problems we have here in Brazil with taxation, labour issues and how hard it is for us to get imports and exports.

“But it is something that is changing and we are probably going to be seeing a lot of new opportunities coming up.

“We are driving forward with sponsors not only from Brazil but also from Latin America in order for us to unite and not only make the Brazil teams grow, but also the other countries.”

Outside Brazil, De Biase lists Argentina, Peru, Mexico and Colombia are the strongest countries for esports in Latin America. 

In order to bring some of the opportunities to the forefront, De Biase, along with several others, last year founded Bad Boy Leeroy (BBL), a holding company that now operates the Brazilian licence of ESL Brazil, along with several other ventures.

“We felt that ESL covered just one part of the ecosystem of esports here in the country and we were leaving a lot of opportunities on the table,” says De Biase.

Along with ESL, BBL has also purchased other intellectual property assets in Brazil. These include Mais eSports, one of the largest esports portals in Brazil, and Party of Legends, a gamer party event operation.  It also has interests in a number of other esports ventures.

One of its most recent partnerships was with Chinese publisher Garena, which licensed BBL to operate its content in Brazil. The company ran the first tournament for new Battle Royale mobile game Free Fire in March, finding a strong reception.

“We were super happy and super surprised because we reached on the finals simultaneous viewers of more than 250,000 CCUs [concurrent users] and in total, on one weekend we had four million unique views on this tournament.”

These numbers are impressive for a relatively new game, says De Biase, when one considers that the Brazilian tournament of League of Legends pulls in 100,000 to 120,000 CCUs on a weekly basis and 300,000 to 400,000 during finals – although admittedly there are also likely a couple of million watching on linear TV.

As well as League of Legends, De Biase lists Counter-Strike, GS: GO and Dota as among the most popular games in Brazil.

Events draw big crowds
Live events are also big business in Brazil. De Biase says the first ESL One, ESL One: Belo Horizonte 2018, held last June, was a huge success.

“For the local markets it was amazing. You have to remember that we decided to do ESL One Belo Horizonte on the same day that Brazil was doing their opening game for the World Cup.

“There were a lot of people who were sceptical about it, but we wanted to move forward as we know the gaming community is super strong. We had more than 10,000 people in the venue and millions joining online.”

Since then, he says RFRSH Entertainment’s Blast Pro Series, held in March, has been one of the more significant events, with a number of other big events planned for this year.

However, he’s uncertain about the prospects of a Major anytime soon. “That is what everybody would love. It is not an easy pitch, but yes we have intentions on pitching Valve for a Major.”

The pitch may become easier if BBL and others succeed in the aim of improving revenues and sponsorships beyond the traditional esports brands in Brazil.  For his part, De Biase says initial signs are encouraging. “Non endemic companies are becoming more and more interested all the time.

In addition, the association between football and esports is growing – for example, in 2017 Flamengo launched an esports division and Ronaldo is among the investors in one of Latin America’s largest esports teams, CNB eSports Club.

There have also been tie-ups between esports and online gambling companies, for example, Betway last year signed a deal to sponsor Brazilian esports brand Made in Brazil.

“It’s getting more and more regular here, although gambling is not legal here in Brazil. But of course international websites and betting systems keep finding their way into participating into the market.

“So we are seeing some activations from these companies on the sponsorship side, or marketing activations to make people go to their website and start betting there. I know that some websites already integrate the Brazilian esports calendars so people can bet on the national games,” says De Biase.

He is hopeful the country may see some movement in terms of legalising betting soon, a move he says would be “amazing” for the company. “We want everything to be legal so we don’t have to push back these companies that are willing to invest in Brazil.”

As yet it remains unclear whether Brazil’s sports betting legislation will allow private operators or not, or whether esports might be included in the forthcoming regulations, but De Biase says there’s more optimism about the proposals than some of the previous attempts to legislate.

Whatever happens with the current measure making its way through Brazil’s legal system, it seems clear that esports is on an upward trajectory in the country in terms of excitement among the fan base. Whether or not the level of investment will start to match that level of excitement remains to be seen.

Leo De Biasi will be speaking at this year’s Juegos Miami, to be held from May 29 to May 31.