Media and communications company Advance has acquired a majority stake in game and esports analytics firm Newzoo.
Newzoo joins Advance's wide variety of other business interests, including the Sports Business Journal, Reddit, Condé Nast (including Ars Technica, Wired, and GQ), the programming brand portfolio Discovery, Charter Communications, American City Business Journals, and others.
Speaking to GamesIndustry.biz, Newzoo co-founder Peter Warman said that Advance's broad interests and portfolio made it attractive as an investor.
"We already knew that a real Silicon Valley-type would not be a typical target in this phase of our company," Warman said. "So we were looking for strategic investors that had something additional to offer, just like our previous investor, Talking Data. Advance was one of the strategic potential investors that came up, and it started just as a raising capital discussion.
"A wide portfolio means we can be part of that portfolio and maintain our own brand and vision. Advance itself is the umbrella company. It's a family-owned business. But they are known to let the businesses they invest in or acquire grow on their own, and that's something that was music to my ears."
"Building a business out of data is something that we have proven, and that is where Advance sees opportunities for brands they already own"
Alongside Advance's acquisition of the majority stake, the media company will also make "a significant investment" in Newzoo. Warman says that, with this investment, Newzoo intends to amplify its presence in the US, beginning with its existing office in San Francisco. He adds that the firm plans to eventually have a presence in New York, where Advance is located, and that it will also bolster its satellite office in Shanghai.
Newzoo's past work with esports analytics and data had been a particular draw for Advance, Warman says. Advance aims to work with Newzoo to bolster and expand the Sports Business Journal's portfolio by providing market intelligence and analytics in the same way the firm has done for gaming and esports. Warman sees esports as a bridge for businesses outside of gaming to get a sense of what the industry has to offer them, particularly in terms of tech innovation, consumer engagement strategies, and business mechanics.
"There's no denying esports has raised awareness and interest from media companies and sports companies because of the eyeballs and recognizable structure it has. It has also raised awareness in all traditional media and press. Esports has definitely played a role in our visibility to companies like Advance.
"Luckily, when they looked into esports they realized this whole gaming thing behind it is what it's all about. That's where it's all coming from, and esports is only one of the directions. But I'm sure it would have taken a couple more years for Advance to notice us if it wasn't for esports.
"Predominantly, Advance is interested in us because of two things: one is, we dare to share a vision and opinion on the market. We know how to pinpoint trends in time. That's interesting for a company that's in the midst of a transition from a traditional media company to digital, as most traditional media companies are.
"Secondly, building a business out of data is something that we have proven, and that is where they see opportunities for multiple brands they already own. Sports Business Journal being the leader in pro sports and business news, they have a light data business, but of course with our systems we could build that out a lot bigger.
"We believe that the tech coming into sports is a bigger and more strategic opportunity than sports bringing something into gaming. We believe that we are more suitable to be the specialist partner for sports companies when it comes to tech innovation. To adjust their strategy and portfolio to the modern day consumer, they will need different tech and mechanics. And that's where we come in."