On­line gamers’ fans are the new re­al­ity

‘This is se­ri­ous busi­ness’ as hun­dreds of es­ports afi­ciona­dos at­tend watch party at west Hous­ton ware­house

Houston Chronicle - - BUSINESS - By Ileana Na­jarro

ONE hun­dred video game afi­ciona­dos were ex­pected to at­tend an on­line tour­na­ment watch party at a ware­house in west Hous­ton. By the end of the night, more than 700 fam­i­lies and friends from across the city packed the venue.

To party hosts, the turnout de­liv­ered a clear mes­sage: Build an elec­tronic sports, or es­ports, hub and the fans will come.

Hous­ton-based ven­ture cap­i­tal firm, Work Amer­ica Cap­i­tal, which funded the watch party, is de­vel­op­ing the city’s first es­ports arena. Spec­ta­tors will be able to pay to watch teams play com­pet­i­tive on­line video games live on stage and on jum­botrons. The build­ing, just north of In­ter­state 10 and west of Belt­way 8, is slated for com­ple­tion by the mid­dle of the year.

The arena marks Hous­ton’s deep­en­ing in­volve­ment in the mul­ti­mil­lion-dol­lar es­ports in­dus­try, and is part of Work Amer­ica Cap­i­tal’s larger de­vel­op­ment of a tech hub called the Founders’ District.

The ware­house, where hun­dreds of fans on Thurs­day cheered for an es­ports team called the Hous­ton Out­laws, will be con­verted into a $70 mil­lion 120,000-square-foot co-work­ing space called The Can­non.

It will fea­ture 50,000 square feet for a startup in­cu­ba­tor with re­main­ing tenants com­pris­ing com­mu­nity banks, lawyers and in­vest­ment ad­vis­ers of­fer­ing ser­vices to the in­cu­ba­tor’s star­tups un­der one roof, said Mark Toon, co-founder of Work Amer­ica Cap­i­tal.

The rest of the more than 20acre site will in­clude tem­po­rary hous­ing for in­ter­na­tional tech en­trepreneur­s, a gym, a foot­ball field, re­tail, restau­rants and the arena, Toon said.

For Toon, es­ports pro­vides a strate­gic in­vest­ment source for com­pa­nies look­ing to at­tract younger, tech-savvy con­sumers.

Last year, the es­ports econ­omy was val­ued at $696 mil­lion ac­cord­ing to in­dus­try anal­y­sis com­pany New­zoo.

Rev­enue gen­er­ated from es­ports is ex­pected to reach $1.5 bil­lion by 2020, much of it driven by cor­po­rate spon­sor­ships and fans buy­ing up mer­chan­dise and ticket sales.

“Es­ports is here to stay,” Toon said.

At the Founders District, es­ports will serve as a perk for young tech en­trepreneur­s look­ing for of­fice space and ac­cess to men­tor­ship and ven­ture fund­ing, said Chris Buckner, founder of Hous­ton tech com­pany, FanRe­act, a port­fo­lio com­pany of Work Amer­ica Cap­i­tal.

Buckner views es­ports play­ers and fans as en­trepreneur­s them­selves, hav­ing built up an in­dus­try through word of mouth and a love for dig­i­tal games. It’s an in­dus­try that now has the at­ten- tion of the In­ter­na­tional Olympic Com­mit­tee.

“There’s no jok­ing around any­more,” Buckner said. “This is se­ri­ous busi­ness.”

Buckner founded FanRe­act in 2014 as a sports so­cial me­dia app. Shortly af­ter be­ing ac­quired by Work Amer­ica Cap­i­tal in 2016, the com­pany piv­oted over to es­ports.

Last year, FanRe­act ac­quired Hous­ton-based GamerWall and South Carolina-based Pubg On­line, two video game tour­na­ment or­ga­niz­ers.

Un­der the ac­qui­si­tion, GamerWall and Pubg On­line com­bined into Main­line, which will launch a new es­ports site on April 1 where fans can get all the lat­est news of their fa­vorite teams and tour­na­ments with­out the need to search in­di­vid­ual Twit­ter or Face­book ac­counts.

Main­line also pro­moted the Thurs­day night watch party. Af­ter only post­ing a few tweets on­line the week be­fore, and fac­ing chilly, rainy Hous­ton weather, the com­pany ex­pected a mod­est turnout.

But word of mouth spread, con­vinc­ing hun­dreds of fans in­clud­ing Kristina Bell, 30, and Mar­celle Martin, 31, to brace the cold and holler at the big screen when­ever their fa­vorite Hous­ton Out­laws player vir­tu­ally gunned down an op­po­nent.

“Let’s go Out­laws, let’s go,” Bell and Martin chanted along with the crowd.

Last year Op­tic Gam­ing, a Dal­las-based es­ports com­pany, bought the Hous­ton Out­laws team to en­ter a city-based tour­na­ment called the Over­watch League.

Thurs­day night marked the Hous­ton team’s first tour­na­ment match.

“It’s great to have a home team to root for,” Bell said.

Sev­eral watch party at­ten­dees echoed Bell’s sen­ti­ment, and spoke of John Sha­ef­fer’s vi­sion for Hous­ton.

When Sha­ef­fer founded GamerWall in 2016 he didn’t con­sider him­self a gamer and knew lit­tle about the es­ports com­mu­nity. He didn’t ex­pect his small com­pany to later get in­vest­ment from the lo­cal Gow Me­dia group, own­ers of Cul­tureMap and ra­dio shows, and he didn’t count on FanRe­act’s ac­qui­si­tion of­fer.

But watch­ing fans of all ages and eth­nic­i­ties min­gle to­gether Thurs­day night fur­ther con­vinced Sha­ef­fer he needed to be a part of the team that would build the first phys­i­cal gath­er­ing space for es­ports fans in Hous­ton.

“It’s a sub­cul­ture that’s beg­ging to break on to the scene,” Sha­ef­fer said.

Brett Coomer pho­tos / Hous­ton Chron­i­cle

Hous­ton Out­laws fans cheer dur­ing a watch party for the es­ports team Thurs­day night at a ware­house that will be con­verted into a $70 mil­lion 120,000-square-foot co-work­ing space.

Hous­ton Out­laws fans Bren­dan Mo­rales, left, and Chris Aguirre en­joy the Out­laws game.

Brett Coomer / Hous­ton Chron­i­cle

Hous­ton Out­laws fans play Over­watch on a side ta­ble dur­ing the watch party for the es­ports team. The sport is look­ing to at­tract younger, tech-savvy con­sumers.

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