A World Leading Esports Solution Provider
Company Presentation October 2018
1. IMPORTANT NOTICE
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2.
Key investment highlights INTRODUCTION
Unique opportunity in fast growing media sector with World leading and independent Esports solutions provider expected TAM(1) of $1.65bn in 2021(2)
Connecting publishers, rights holders, brands and media partners with digital, Publisher partnerships, a significant proof of capability and large monetisation engaged and growing Esports community opportunity for both managed and owned solutions
Trusted by partners such as EA, Microsoft, Formula 1, Facebook and HT&E Opportunity to leverage large existing audience and commercial structures from FIFA, Formula 1 and other rights holders to achieve scale quickly Building Esports community of consumers playing, watching and socialising on the Gfinity platform and engaging with publishers, rights holders and brands Monetisation driven by shared and owned Esports content
New and seasoned management team to execute new Leading end-to-end solutions for B2B and B2C opportunities and next growth phase
"Powered by Gfinity", B2B managed services: Esports solutions and content Solid foundation for growth through strategic partnerships with leading services for publishers, rights holders and brands publishers and rights holders attracting brands and consumers
Gfinity owned B2C content and community: Owned formats, leagues, events Investing to build managed partner solutions and to integrate our Gfinity Elite and user community integrated with managed services Series format to create leading community platform for monetisation
Underpinned by proprietary, scalable and flexible tournament platform, Target break-even next few years driven by managed services, shared and Esports studio and broadcast platform owned content on a consistent Opex base
(1) “Total addressable market” (2) Newzoo 2017 Global Esports Market report 3.
The Team INTRODUCTION
Graham Wallace Jonathan Hall Amanda Lawson
Global Chief Operating Officer Chief Financial Officer Global Head of Content Ex-MTV, IMG Media, Ex- Saracens Rugby, Ex-UFC, ITV Sport Manchester City FC, Rangers PA Consulting, Arthur Andersen Executive Producer FC
Garry Cook Executive Chairman Ex- Global Brand Officer, UFC CEO, Manchester City FC President, Michael Jordan Brand, NIKE
Paul Kent Eric Ping Bryan Healy
Global Head of Esports Solutions Chief Technology Officer Global Head of Client Services 20+ years in Esports CTO CEVO 13+ years Ex-UFC, WMG, NBC Sports, FIFA 2010 World Cup
4. Over 2bn gamers MARKET
Social Community Global Sports Fans 2.2 Bn
Global Gamers 2.2 Bn
Esports 380 Million
Source: Newzoo 2017 Global Esports Market report Watching Live Events
Gaming is what every traditional sports league is desperate to become: young, global, digital and increasingly diverse. ESPN Magazine
5. Large and growing global audience and market MARKET
2.2 BILLION 380 MILLION 588 $112 Million $1.65 Billion 38% People globally who play Global number of players The number of major Prize money broke Projected Esports Global Esports revenue video games & enthusiasts in global Esports events $100 million mark for the revenue by 2021 increase during 2017 2018 in 2017 first time in 2017
m Esports audience growth Prize money development USDm Esports revenue growth USDm 120 557 112 600 499 100 93 2,200 500 436 2,000 1,651 80 1,800 1,445 380 116 400 335 307 1,600 277 61 60 1,400 1,170 243 300 281 215 1,200 906 759 192 1000 40 655 36 800 200 160 493 231 600 19 149 20 9 13 400 > 100 193 222 250 6 121 143 165 3 5 6 200 396 0 0 0 2017 2019e 2020e 2021e 2016 2017 2018e 2019e 2020e 2021e 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2016 2018e
Media Merch & Advertising Sponsorships Publisher Esports enthusiasts Occasional viewers rights tickets fee Source: Newzoo 2018 Global Esports Market Report 6. Value chain MARKET
Players/Teams Games Leagues/Tournament* Platforms Community
play organised in distributed on to
Games Developers + Publishers Brands + Advertisers Rights Holders + Key partners
Utilise ecosystem expand Increased monetisation Reach an engaged young audience and increase value of opportunities audience products
*Gfinity is an example of leagues/tournament operator 7. Our opportunity – bridging real and virtual sport MARKET
Value of content rights per year: Revenue per Esports fan versus sports fan (2017) 2Bn ~$1.93Bn* Sports rights market and fans
USD 47bn 24m $54
fans 2.2bn 1Bn
20m
USD USD 16m
Esports market ~$260m*(1)
and fans 200m 12m
USD 0.7bn 100m 8m fans 0.4bn 50m $45m 4m $2.4
0 *UK only
Source: Newzoo (2017 & 2018), Reuters, Sportsbusiness, Esport Observer, Gfinity (1)f1broadcasting.co estimate 8. Why Gfinity – our value proposition BUSINESS MODEL
Game & Content Creation Own Esports Data, Analytics & Integrated Community Tournament and Studio Marketing Technology Platform Management Distribution Platform
PUBLISHERS RIGHTSHOLDERS BRANDS & MEDIA CONSUMERS
• Drive growth in users, • Joining physical and • Structured access to • “Powered by Gfinity” sales & retention digital world global gen Y, Z and millennial consumers • Trusted brand and path • Complete technology • Access to next to professional Esports platform & integrations generation audiences • Data, insight, analytics and advertising • Exclusive publisher and • “Gfinity Web Services” • Grow audience and monetary opportunities consumption • Bespoke Esports • Solid execution track solutions and content • Building portal for record across genres • Trusted tournament Esports, content, operator and expertise • Esports broadcasting and competitive - and social - • Expertise – Esports, branding expertise gaming media and content • Bespoke solutions 9. Working with leading Game Publishers, BUSINESS MODEL Rights Holders and Broadcasters
10. What we do BUSINESS MODEL
World Leading Esports Solutions Provider End-to-end solutions leveraging Esports expertise, technology content and broadcast capability
Managed Services Owned and Operated
Esport Solutions Content Creation Owned Content Tribe
Online & offline game and Offering world class Gfinity owned and Building service offering event management studio and creative branded leagues & access to our proprietary underpinned by leading expertise to deliver high events, including The community platform of Esports technology platform quality and valuable Gfinity Elite Series engaged consumers content
Game Publishers, Content Buyers and Our Brand, Production, Our Users, Viewers, Fans, Sport Rights Holders, Distribution Platforms Content, and Format Consumers, Data, Insight Commercial Partners 11. Managed Services MANAGED SERVICES
Esports Solutions Content creation & distribution
Everything from consultancy and strategy to execution Unparalleled Esports live production and distribution for commercial and publisher partners - State of the art Esports Studio End-to-end tournament and game management: - Experts in both video and non-video content - Focus on shoulder content and story telling - Integrated and scalable online and offline tournament platform - Strategy, marketing, commercial and execution consultancy Distribution on external and internal channels - High quality broadcast technology - Distribution on multiple linear and OTT platforms as well as - Gfinity brand: Trusted by gamers worldwide across future Gfinity Community platform Adaptable to any publisher, rights holder or partner - Leveraging rights holder existing commercial structures - Bespoke or joint solution, but normally co-branded
12. F1 Esports Series 2017 &2018 MANAGED SERVICES
2017 2018
60K Number of entrants Number of Entrants 66K
20 Number of broadcasters Viewers under 34 years old 80%
123 Number of countries Engagement (so far) 1M
Professional teams signed at 6M Views for finale event least 1 players each 9
2 live events: Semi Finals at Gfinity Studio 1 pro draft event (July), 3 schedules live and finals in Abu Dhabi November 2017 events starting October 2018
13. Premier League partnership PREMIER LEAGUE
Bridging real and virtual sport
- Esports tournament partner for inaugural ePremier League - Online qualifiers via Gfinity’s proprietary tournament platform - Live qualifiers for all 20 clubs building up to finales event at Gfinity Studio in London April 2019 - Collaboration with EA Sports and Premier League
Leverage large incumbent fan base
- Leverage existing Premier League and clubs distribution - Billions of incumbent football fans worldwide - >60m active FIFA 18 players growing >10% YoY (1) - Sky Group has reach of >100m consumers
Inflection point
- First step by Premier League into Esports - Strong validation of Esports market and Gfinity’s position - Opportunity to expand scope and monetisation in 2019
(1) EA Fiscal Q3(18) Report Transcript 13.14. Owned content: OWNED & OPERATED
Esports Solutions Elite Series is a proprietary tournament format featuring some of the world's leading teams worldwide
- Challenger league winners qualify to drafts for Elite teams - Arcade casual tournaments and play with friends * - Showcase for driving managed and co-branded solutions - Currently running in UK and Australia
Live and shoulder content are 100% owned
- Licence fee to publishers & revenue share with franchisees - Opportunity for additional and supporting content - Multi year partnership with Dominos
Flexible tournament infrastructure
- Adaptable to any competitive publisher title (BETA) - Proprietary league structure will be integrated with managed (BETA) Esports solutions to grow Gfinity Tribe - Managed solutions or exclusivity pulls consumers to owned content without committing large prize pools *top layer is illustrative
15. A Dedicated 16 Week Esports Tournament Franchise OWNED & OPERATED
6 weeks 2 weeks 8 weeks
An online competition featuring Top 30 players from each title 5 weeks of live ‘round robin’ three Esports games: qualify: competition
Every Friday & Saturday
Followed by: Quarter-final Compete to earn G-Points Each team will select 2 players Semi-final & per game to join their pro roster Grand final
16. Key Elite Series UK Season 3 Stats OWNED & OPERATED
Total Live Ancillary Live Stream Viewership Stream Content Engagement Growth Viewership Viewership SOS
12.5M 4.9M 161,560 143%+ Unique Unique Engagements Against Elite Viewers Viewers Series Season 2
17. Gfinity Tribe OWNED & OPERATED
Gfinity online Esports community
- A way fay for consumers to stay engaged and loyal - Play, socialise, track and engage - Building own platform joining all consumers touched by external or internal content and solutions
Gateway to professional gaming
- Established amateur challenger and draft leagues - The best players progress to professional “Elite Series” - Casual tournament builder in beta (Arcade)
Developing monetisation opportunity
- Supports B2B Esports solutions - Broad user data, analytics and insight - Cross promotion, merchandise, affiliate etc. - All Esports solutions drive traffic to Gfinity sites 18. Growth strategy STRATEGY AND OUTLOOK
Drive profit share and community monetisation by leveraging Redeem Rewards our strong brand and publisher partnerships
Upgrade Broaden publisher and rights holder partnerships and community scope to drive audience and user growth
Unlock potential Integrate B2B managed Esports solutions with B2C solutions to drive monetisation of owned & operated properties
Build Gfinity brand position and Secure key publisher and Level-up content production capability rights holder partners
19. Financial Ambition STRATEGY AND OUTLOOK
Revenue Opex LTM = Last 12 months LTM = Last 12 months Fiscal year end June Fiscal year end June
£10-12 £7.0 £4.6 £2.8 £3.3 £2.1 £1.4 £2.4 £0.7 £0.2 £0.6
2014 2015 2016 > 2017 H1(18)LTM Medium 2014 2015 2016 2017 H1(18)LTM Medium term term Financial characteristics Financial ambition
- Scalable business model driven by content value • Target of break-even next few years - Contracted revenue base with strong partners • Target group gross margin of 30-40% - Upside driven by number of partnerships, content value • Target EBITDA margin of 15-25% and community monetisation - - Opex driven by number and scope of publisher and Revenue: Initial pick-up in growth driven by EA and Premier rights holder partnerships League managed services and content creation - - Asset and Capex light as per partnership model Growth: Further growth driven by integration with owned and operated leagues and content for monetisation - Margin: range driven by long term mix of third party versus Gfinity solutions and content 20. Revenue model STRATEGY AND OUTLOOK
P A R T N E R S
ADVERTISING R Rights holders Commercial E Community E-COMMERCE V Publishers Media SUBSCRIPTION E N TERM FEES Esports U Solutions FIXED FEES E LICENSE M
SPONSORSHIP O Influencers Teams D Content ADVERTISING E Casual gamers Competitive gamers RIGHTS FEES L
A U D I E N C E
21. Significant Recent Activity STRATEGY AND OUTLOOK
• Gfinity appointed Tournament Operator of inaugural ePremier League (“ePL”) Tournament
• Partnership with Arup to design leading Esports facility for 3rd parties
• Signed Domino's as presenting partner – 3 year escalating deal
• Appointed F1 Global Esports Partner
• Signed exclusive partnership with Facebook for Gfinity Elite Series
• Acquired CEVO, a leading Esports technology and gaming company
• Won NVIDIA account for Esports strategy and management
• CEVO appointed to manage Turner ELEAGUE CSGO
• Launched Elite Series Australia in partnership with HT&E
• Microsoft Global Tournament operator for Forza Racing
• Managed COD & HALO European Championships
• Acquired and integrated RealSport, a leading online Esports community builder and content creator 22. Competitive Landscape STRATEGY AND OUTLOOK
Casual online Integrated Main competitor Event operators communities publishers
Events
White label offering
Proprietary offering
Offline platform
Online platform
Broadcasting
Content creation
Online community
Main business offering End-to-end Owned events White label events Online tournaments Own games
Mainly competing on: Online users & events Event operations Online users Content viewership
Source: Gfinity 23. Summary STRATEGY AND OUTLOOK
World Leading Esports Solutions Provider 1 Connecting brands and publishers with a growing and engaged Esports community through world class content production capabilities, world leading tournament platform and leading community portal
Preferred and trusted independent Esports partner 2 Leading publisher, rights holder and commercial partner position drives Gfinity media brand and proprietary, scalable and global Esports community platform
Unique B2B and B2C position 3 Uniquely positioned to capitalise on fast growing media sector due to mission critical end-to-end Esports solutions and community audience
Solid foundation to grow 4 Investing to build and capitalise on partnerships with leading rights holders and publishers(B2B) – driving monetisation of proprietary Gfinity user community & content (B2C)
24. APPENDIX
Appendix
25. P&L SUMMARY & FINANCIALS
Dec- 15 Jun - 16 Dec - 16 Jun - 17 Dec - 17 Fiscal year end June P&L H1(16) H2(16) H1(17) H2(17) H1(18) 2014 2015 2016 2017
Revenue 0.62 0.82 0.90 1.47 1.83 0.21 0.56 1.45 2.37
COGS -0.96 -0.65 -0.99 -1.78 -5.04 -0.62 -2.00 -1.61 -2.78 Gross Profit -0.33 0.17 -0.09 -0.31 -3.21 -0.41 -1.44 -0.16 -0.40 - gross margin (%) neg. 0.21 neg. neg. neg. neg. neg. neg. neg.
Opex -1.48 -1.33 -1.51 -3.10 -3.88 -0.67 -2.08 -2.82 -4.61
EBITDA -1.82 -1.16 -1.60 -3.42 -7.09 -1.07 -3.52 -2.98 -5.01
D&A -0.07 -0.11 -0.12 -0.20 -0.49 0.00 -0.04 -0.18 -0.32 EBIT -1.88 -1.27 -1.71 -3.62 -7.58 -1.08 -3.56 -3.15 -5.34 - margin (%) neg. neg. neg. neg. neg. neg. neg. neg. neg.
Net Interest 0.01 0.01 0.00 0.00 0.00 0.00 0.00 0.02 0.00
Share of Profit/ (Loss) in Associate 0.00 0.00 0.00 0.00 -0.15 0.00 0.00 0.00 0.00
Profit before tax -1.88 -1.26 -1.71 -3.62 -7.72 -1.08 -3.55 -3.14 -5.33
Tax 0.10 0.00 0.00 0.10 0.00 0.00 0.00 0.10 0.10
Net Income -0.05 0.06 -0.03 -0.07 -7.72 -0.01 -0.05 0.01 -0.10
Weighted average number of shares 79.40 81.50 149.33 157.21 203.16 31.79 59.90 81.50 157.21 EPS (pence) -2.24 -1.54 -1.15 -2.24 -3.80 -3.38 -5.93 -3.73 -3.33 26. Balance sheet SUMMARY & FINANCIALS Fiscal year end June
Balance sheet 2014 2015 2016 2017
Property, plant and equipment 0.01 0.22 0.88 0.29
Intagible fixed assets 0.00 0.00 0.07 0.12
Investments in associate 0.00 0.00 0.05 0.00
Non-current assets 0.01 0.22 1.00 0.42
Inventories 0.00 0.00 0.00 0.01
Trade and othre receivales 0.14 0.57 1.66 0.44
Cash and cash equivalets 0.59 2.73 4.52 0.83 Current assets 0.73 3.31 6.18 1.28
Total assets 0.75 3.53 7.18 1.70
Total equity 0.31 2.92 5.43 0.84
Borrowings 0.33 0.00 0.00 0.00 Non current liabilities 0.33 0.00 0.00 0.00
Trade and other payables 0.11 0.60 1.75 0.85 Current liabilities 0.11 0.60 1.75 0.85
Total Equity and Liabilities 0.75 3.53 7.18 1.70 27. Cash Flow SUMMARY & FINANCIALS
Dec- 15 Jun - 16 Dec - 16 Jun - 17 Dec - 17 Fiscal year end June
Cash flow H1(16) H2(16) H1(17) H2(17) H1(18) 2014 2015 2016 2017
Operating cash flow -1.94 -0.56 -1.72 -3.71 -6.36 -0.37 -3.43 -2.50 -5.44
Additions to PPE 0.01 -0.24 -0.03 -0.56 -0.24 -0.01 -0.24 -0.23 -0.60
Additions to intagibles -0.22 0.07 0.00 0.00 0.00 0.00 0.00 -0.15 0.00
Other investments 0.00 0.02 0.01 -0.01 -0.77 0.00 0.00 0.02 0.00
Total capex -0.21 -0.16 -0.02 -0.58 -1.01 -0.01 -0.24 -0.37 -0.60
Issue of equity share capital 0.97 0.00 3.64 6.31 7. 0 0 0.68 5.81 0.97 9.95
Share issue costs 0.00 0.00 0.00 -0.23 -0.21 0.00 0.00 0.00 -0.23
Loan 0.00 0.00 0.00 0.00 -0.03 0.00 0.00 0.00 0.00
Net financing cash flow 0.97 0.00 3.64 6.08 6.76 0.68 5.81 0.97 9.72
Net cash flow -1.18 -0.72 1.89 1.79 -0.62 0.29 2.14 -1.90 3.69
Opening cash and cash equivalents 2.73 1.55 0.83 2.71 4.52 0.30 0.59 2.73 0.83
Closing cash and cash equivalents 1.55 0.83 2.71 4.52 3.90 0.59 2.73 0.83 4.52
28.