The risky life of esports orgs outside the big leagues

Esports is increasingly being associated with multimillion-dollar deals, packed stadiums full of screaming fans, and overt, obvious signs of success. From the Overwatch League to the League Championship Series, there’s a vision of competitive gaming that mimics the pomp and circumstance of traditional sports.

What’s less obvious are the smaller success stories. Smaller organizations, even if they have some venture capital funding, have to throw stuff at the wall until they find things that generate revenue. Every organization is creating content, but no one has found the surefire key to success.

Tempo Storm is a smaller esports organization that started in 2014, focused on strategy games. Its fan base skews a little older than the norm in the industry, and the organization is focused heavily on streaming and ongoing digital content. It’s a largely online approach compared to your modern, big-budget esports organization — and it has built-in risks. The farther any one organization spreads, the more its priorities can conflict.

Seeing what sticks

“We started the company in 2014, and the first time that we raised a proper round was very recently, so we actually bootstrapped for a lot of years,” says Tempo Storm owner and founder Andrey “Reynad” Yanyuk in an interview with Polygon. “With other teams, their strategy is very much leaning into the whole [venture capitalism] model where they raise a pile of money, do stuff with it to try to raise much more money.”

This high risk approach has been seen in places like the Overwatch League, where team owners dropped $20 million to get in on the first wave of franchising.

“It’s not always sustainable, because your burn rate becomes crazy,” Yanyuk says “Is it worth getting a AAA sponsor who pays you a million dollars if you had to burn twenty million to get that by buying an unsustainable asset?”

Even with funding, Yanyuk says that the organization remains conservative. “For every dollar going out, we have 80 cents coming in. We make longer term bets,” he adds.

Here’s where the potential risk comes in. Tempo Storm is developing its own card game, The Bazaar, that could potentially become a big title (or even an esport) of its own. For an organization to control a game that could take off with other players or streamers is an unprecedented arrangement; usually, a developer stands independent from the organizations to participate in the game’s ecosystem. When the game gets closer to release, Tempo Storm will have to address the potential ethical concerns there.

While the organization works on developing its own game, it has signed players, streamers, physical trainers, and more. Its investment in each team depends from esport to esport, and Tempo Storm maintains “an army of contractors,” which adds up.

Andrey Yanyuk

Long-term bets, global relationships

One high-profile signing was Ng “blitzchung” Wai Chung, the Hearthstone player who supported pro-democracy protests in Hong Kong and kicked off a major controversy in the process.

“I think it was riskier for our brand to sign with Blitzchung than any other team, because we’re the only one making a game — and China is a really important thing for a game company.” Yanyuk said. “The last thing we want to do is antagonize China.”

Yanyuk said Tempo Storm put a lot of thought into the decision to sign Blitzchung, but ultimately he is happy with the decision. “It’s really easy to go on Reddit and just shit talk China’s policies and not do anything meaningful, but we wanted to take a stand and show that one of the things we look for in our players is character and integrity,” he says. “If a player comes along and shows those qualities, and we don’t sign them because of risk of repercussions from China... that would have been pretty disingenuous.”

Blizzard Entertainment via Polygon

Banking on The Bazaar

While Tempo Storm has teams across a wide variety of games, the internally developed card game could potentially be the team’s biggest venture.

Yanyuk also sees a window of opportunity in the market. “I think the last five card games or whatever that have been released by big publishers have all been just aggressively mediocre,” he says. “It’s always for the same reason and it’s just the way approval process works in their company.”

Yanyuk notes that there are layers to approval in companies, and publishers want to make bets on safe properties. Hence, with the exception of a few games like Gwent, he notes that most of the existing card games have a clear lineage back to Magic: The Gathering. Yanyuk is aiming to develop something closer to League of Legends in terms of queuing and balance. “It’s something that degenerates like myself on Twitch can play 12 hours a day and still enjoy it after a year, two years,” he says.

“It’s the people part of business I struggle with,” says Yanyuk, noting that the best parts of business are the ones that mimic the card games he plays. Sorting out office hierarchy and contractor communication was the hardest part of the process. As for the rest, he says that development is going surprisingly well. “I thought it would be a bit of a shit show, to be honest,” he admits.

When it comes to the future of Tempo Storm, The Bazaar is a large pillar, but Yanyuk — and other esports organizations — are also keeping an eye on Twitch and its competitors.

“I think a lot of people look at the rise of Twitch and livestream platforms, and they think the reason they’re blowing up is because gaming content is blowing up. But really what’s blowing up is interactive media,” he says. He notes that Twitch streams and audience participation are valuable parts of streaming.

For Tempo Storm, that started with a travel show, Game Changers, but will expand. “I want to do a dating show, a cooking show, all kinds of different formats are just up for grabs, and we lean into the interactivity part of it,” says Yanyuk. With a wide array of gamers, content creators, and influencers, an organization can take advantage of that and the parasocial relationships formed between viewer and player to branch out beyond just gaming. In 2020, the most successful esports organizations may be the ones that can best adapt beyond esports itself.