YOUR BUSINESS AUTHORITY
Springfield, MO
YOUR BUSINESS AUTHORITY
Springfield, MO
No one can say Springfield-based esports franchise company founder Brett Payne doesn’t have high aspirations.
Payne, along with his wife, Kristi, co-owns Contender eSports LLC, an umbrella company formed in 2018 to sell numerous video gaming center franchises across the United States. The centers, including one in Springfield that opened in February 2020, provide spaces for customers to participate in the competitive multiplayer video gaming industry. The Queen City was the fourth Contender eSports franchise location, a total that has grown to 10 in nine states, including Florida, North Carolina and Texas.
“We’re essentially trying to be the Starbucks of esports,” Payne said, adding he’s the franchisee of the Springfield center. “There’s a general connotation when people talk about coffeehouses or coffee places, instantly they think Starbucks. We don’t have many locations, but we’re the biggest franchise out there.”
A couple of local higher education institutions also are part of the burgeoning industry, which exceeded $1 billion in worldwide revenue last year. Drury University debuted a competitive esports program in 2019 and will be followed this fall by Ozarks Technical Community College. It marks the first sports team fielded by the college in its 32-year history.
Most esports titles are first-person shooters, fighting games, real-time strategy or multiplayer online battle arena contests. Fortnite, League of Legends and StarCraft II are among popular games that individuals and teams participate in worldwide through tournaments, seasons and leagues. Dedicated esports venues even have emerged around the country in recent years, including Blizzard Arena in Los Angeles and ELeague Arena in Atlanta.
By 2024, the global revenue for the esports industry is projected to reach over $1.6 billion, a roughly 49% increase, according to Statista. The market research company reported China was the largest market by revenue in 2021, earning $360.1 million, followed by the United States at $243 million.
According to gaming research platform Newzoo, esports sponsorships were estimated to account for $641 million worth of revenue in 2021. Industry sponsors include Coca-Cola, BMW and Red Bull.
Drawing attention
Payne said the busy intersection of South National Avenue and East Battlefield Road likely draws a lot of eyes to his gaming center. Quite a few people still wonder what esports are, he said, but added general awareness of his company has “gone up exponentially” over the past few years.
At the gaming centers, players can pay by the hour, purchase day or night passes or sign up for monthly memberships. Member rates range $5.50 for an hour to $24 for six hours, and non-members pay $10-$40 for the same time periods. Passes range $12-$35, and individual memberships run $10-$225 per month.
Payne said memberships in Springfield number around 300, noting roughly 10 new members sign up weekly. It averages around 100 first-time customers every month, a number he said is slowly climbing. While promotions such as ladies’ nights are held weekly, Payne said 90% of Contender’s customer base is male.
“It’s a culture and it’s going to take time to overcome that,” he said of the discrepancy between male and female players. “But we’re very attentive to it.”
Year-over-year company revenue grew roughly 20% in 2021, Payne said, declining to disclose figures. He expects that percentage to at least be matched this year as new gaming centers launch.
Estimated initial investment for a franchise range between $170,100 and $265,740, including a $39,000 franchise fee, according to the company’s website. Franchisees pay an ongoing royalty fee of 6% of weekly sales with 2% of the total paid toward additional advertising expenses.
Despite the coronavirus pandemic, Payne has ambitious growth goals for the near future. He wants to have at least 100 locations both in and out of the U.S. by the end of next year.
Sports first
As Springfield’s lone esports gaming center enters its third year of operations, OTC is on the cusp of making its competitive sports premiere. The college is putting finishing touches on its new esports Computer Lab and will begin its first season in the fall semester. OTC invested $450,000 to remodel and equip existing lab space with computers, gaming consoles and furniture, according to spokesperson Mark Miller.
Tiffany Ford, department chair for computer information science, said adding esports on campus has been a goal of hers for about a decade.
“There aren’t a lot of two-year schools that are in the esports space, and that kind of is what held us back a little longer than other four-year schools that jumped in earlier,” she said.
One of those four-year schools is Drury, now in the third year of its esports program. The school also hosted the Unified Esports Conference, a two-day event earlier this month that had thousands in cash and merchandise up for grabs in games such as Mortal Kombat and Street Fighter V, according to the event website.
Ford, who also is OTC’s esports program manager, said she was contacted last year by Provost Tracy McGrady to start the process.
“We decided let’s see if we can pull this together,” she said.
The computer lab has been open for about a month for recreational play. Competitions will start in the fall as OTC joins the National Association of Collegiate Esports. At more than 170 members, NACE is the largest association of collegiate esports programs in the country.
Students must be enrolled full time, have a 2.5 grade-point average and commit to weekly practices to be eligible for the team. Ford said OTC is actively recruiting players for League of Legends, Rocket League and Super Smash Bros., with the squad comprising 16 students.
Interest was immediate when the school sent out a survey to students at the start of this semester, she said.
“We had about 200 people sign up overnight, which is a little intimidating,” Ford said, adding tryouts will be held after spring break as well as in August for incoming students. “There’s only good opportunities here. I really see a lot of room for growth.”
Payne also is anticipating growth for his company, which has its headquarters in the Efactory at 405 N. Jefferson Ave. In addition to its 10 centers in operation, he said Contender eSports has 13 more franchisees that have signed agreements to open by 2023. Two of those are in Canada and Saudi Arabia, marking the company’s first centers to open outside the U.S.
Another new center will be in Canton, Ohio, home of the Pro Football Hall of Fame. The franchisee group is led by former NFL player Kenny Peterson, who played seven seasons in the league with the Green Bay Packers and Denver Broncos.
“We’re excited about that because that’s going to open us up to professional athletes,” Payne said.
He said the franchise center total would be larger if not for the pandemic, which emerged just weeks after the Springfield center opened in 2020 and essentially halted expansion plans for over a year.
On the international front, he said the company has received a lot of interest in Europe and Australia, noting representatives from South Africa plan to be in Springfield next month to sign deals for centers in the country.
“You have to drive to get somewhere,” he said of expansion plans. “However, I’m not going to cry if we don’t get there.”
