Talon, an esports startup company located in Hong Kong, has raised $5 million in Series A funding. Animoca Brands, an entertainment business, led the Series A funding round.
The Series A investing round has attracted interest from many investors based in Asia and elsewhere. In addition to Animoca Brands, investors in the esports startup company include Hana Digital Transformation Fund, HZL Capital, AK Partners, Token Bay Capital, Foxmont Capital Partners, and Yieldly. Animoca Brands is a business best known for several video games, such as Crazy Kings and The Sandbox. In addition to games, Animoca Brands is also actively developing open metaverse games and experiences.
"Talon is a great example of how the communities of esports and gaming are converging on blockchain and making use of NFTs. We look forward to working with Talon and the many companies in our investments portfolio in order to bridge these communities and take us one step closer to making the open metaverse a reality,” said Yat Siu, executive chairman and co-founder of Animoca Brands.
Talon previously raised a $2 million seed funding round in October 2020. Hana Ventures led the funding round with participation from New Wave Esports, Sprout Investments, and family offices. Hana Ventures is part of Hana Financial Group, a South Korean financial business with more than $9 billion in annual revenue.
Esports Track Record
Talon already has a significant presence in the esports industry. The company has fielded teams in several major game competitions for League of Legends, Dota 2, Tekken 7, and Street Fighter V. Established in 2017, the startup company also sells clothing, canvas bags, and other physical products through its website. The company currently has a presence in Hong Kong, Taiwan, South Korea, and Thailand. With its Series A investment, Talon plans to expand further into Indonesia, the Philippines, and Vietnam.
The esports startup company has millions of online followers on social media. However, the company may face challenges in leveraging those followers because they are divided across more than 20 esports teams. For example, gamer Sadman-Happy has approximately 17,000 Facebook followers. In contrast, gamer Tony has over 80,000 followers on Facebook. While the coordination of so many teams and players may be complex, it does offer some diversification in case a particular game loses popularity.
Blockchain and NFT Expansion
Earlier in 2021, Talon expanded into blockchain by partnering with Yieldly. By partnering with Yiedly, the startup business gains access to a blockchain-based lottery. The Yiedly decentralized finance offering is based on the Algorand blockchain. Algorand was launched in 2019. The associated cryptocurrency Algo has a market capitalization of over $10 billion, according to CoinMarketGap. The startup business plans to create collectibles, NFTs, and related offerings in the future.
The Multibillion-Dollar Esports Business
The startup company states that it has quadrupled revenue since 2019. This high level of growth is partially driven by the industry’s high level of growth. In 2017, the US esports industry generated approximately $120 million in revenue, according to Grand View Research. By 2020, the global market for esports grew to over $1.4 billion. Grand View Research also notes that the esports industry is expected to grow more than $6 billion by 2027.
Bruce Harpham is an author and marketing consultant based in Canada. His first book, "Project Managers At Work," shared real-world success lessons from NASA, Google, and other organizations. His articles have been published in CIO.com, InfoWorld, Canadian Business, and other organizations. Visit BruceHarpham.com for articles, interviews with tech leaders, and updates on future books.