Simplicity Esports and Gaming Co (WINR)

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Bloomberg article about WINR....

Gamers May Have a Cure for Distressed American Shopping Malls



Jed Kaplan, the founder and CEO of Simplicity Esports & Gaming Co. (and co-owner of the National Basketball Association’s Memphis Grizzlies) said that his company now has 45 gaming lounges in locations like the Edgewater Mall in Biloxi, Mississippi, and West Park Promenade in Billings, Montana. Five more are under construction. Most of the centers, he said, are run by local franchisees, many of whom come from the food industry. “I’ve spoken to a lot of Dunkin’ Donuts and Subway franchisees,” he said. “Recently, it’s shifted to mall owners. We’ve talked to people from private equity who have invested in distressed malls and are looking for an attraction.”

Simplicity also owns a number of professional esports teams. Periodically, Simplicity has held promotional events where amateurs can play head-to-head against the pros. “That’s a huge draw for the mall,” Kaplan said.

According to Kaplan, before the pandemic, local elected officials were starting to offer support and incentives to lure esports centers into their community malls. “The local governments are looking at this as a way to revitalize something that at one time was the highlight of that town,” he said. “They look at one time was the highlight of that town,” he said. “They look at it almost like building a new sports stadium.”

The newfangled esports venues tend to earn revenue from multiple sources. They sell memberships, rent time on their computers and consoles to drop-in guests, host tournaments for major game developers, produce esports programming for TV and the web, sell gaming equipment, host birthday parties, sedate anxious parents with craft beers, run camps and sell sponsorship opportunities.

Nerd Street Gamers’ list of recent sponsors has included Kellogg Co., DreamSeats LLC, and Mike and Ike. At one Nerd Street event, gamers dumped a bucket of Mike and Ike candies over the head of a victorious esports player, a nod to the Gatorade Shower. At the Allied Esports venue inside the Luxor resort in Las Vegas, the weekly Mario Kart competitions have been sponsored by a local Volkswagen dealership. Anyone who signed up for a test drive was comped free game time.

It’s not just shopping malls owners who have been fueling the construction boom. Many institutions of higher education have added varsity esports teams. As a result, various colleges have been looking to break ground on esports venues. “The school gets the naming rights,” Fazio said. “They get to use the facilities for their curriculum and for classroom usage. And they get a reserved space for their varsity team.”

Later this year, Rowan University is scheduled to open a Localhost on its campus in Glassboro, New Jersey. Joe Cardona, a vice president at the public school, said the new space will eventually be “the go-to collegiate esports facility” in the region and a unique perk for students. The skills acquired in esports, he said, are transferable to everything from graphic design to computer science to business development to streaming-media careers. “This is also going to help from a recruitment point of view,” Cardona said. “Kind of like a new football stadium.”

Periodically, American sports fans freak out that the country is falling behind the rest of the world in one form of competition or another (see, for example, the longstanding angst over America’s slump in men’s tennis). At the moment, many of the top esports competitors hail from Asia or Europe. Esports boosters say that one way to improve the pipeline of local talent over the long term is for the U.S. to improve its community esports facilities.

In recent years, Fazio said, competitive gaming in the U.S. has favored kids from upper middle-class backgrounds — the small subset of families whose parents can afford to shell out thousands of dollars every year for top-of-the line gaming equipment. Not so, he said, at venues run by Nerd Street Gamers. “Here, everybody competes on the same computer,” Fazio said. “We want esports to be accessible. That only comes with building more facilities.”

“You want some place where the parents will go, know that their kids are safe and feel comfortable staying and having a glass of wine,” said Kaplan of Simplicity Esports. “We’re creating a social environment.”

©2020 Bloomberg L.P.



https://www.bloombergquint.com/onweb/gamers-may-have-a-cure-for-distressed-american-shopping-malls