VSPN, a Tencent-backed Chinese esports solutions provider, announced on Friday the completion of a Series B+ funding round of $60 million as the esports industry continues to clock significant growth as more people resort to online entertainment amid the COVID-19 pandemic.
The fundraising attracted capital injections from China-focused growth capital fund Prospect Avenue Capital (PAC), Chinese financial services provider Guotai Junan International, and Hong Kong-based property developer Nan Fung Group.
Lighthouse Capital acted as the exclusive financial advisor for the deal.
Proceeds from the new round will help VSPN step up investments in developing innovative technologies used for esports production, widen its business layout in esports-related intellectual property (IP), and explore markets outside of China.
Shanghai-based VSPN, established in 2016, is primarily involved in organising esports events, esports content production & distribution, esports commercialisation, and provision of offline esports venues.
VSPN claims a 70% market share of premium esports events in China and a 50% market share globally. It has over 700 employees and operations across four offices around the world, according to the firm’s website.
“The esports industry is going through its nascent phase and is entering a new era,” said Dino Ying, founder and CEO of VSPN, in a statement. “We are counting the days until the pandemic is over and we hope that we can make fast and steady progress in expanding VSPN internationally, participating in the making of global esports standards, and supporting the development of a sustainable esports ecosystem worldwide.”
The Chinese esports upstart is betting big on the global market where the total esports revenues are estimated at $1.1 billion in 2020, with a year-on-year growth of more than 15.7%, according to games & esports market researcher Newzoo. Globally, the number of esports audiences reached 495 million in 2020, up 11.7% from 2019.
While China topped as the world’s biggest esports market, emerging markets like Southeast Asia, India, and Brazil are at the forefront of the industry’s burgeoning growth. In an interview with the Chinese outlet National Business Daily last October, Ying said that VSPN has placed Southeast Asia as “a primary battleground” for its international foray.
VSPN is well-funded in its march into the global esports market.
Three months earlier, the startup had closed $100 million in a Series B round led by Chinese social networking and gaming giant Tencent. Tiantu Capital, a Chinese equity investment firm focusing on the consumer sector; Susquehanna International Group (SIG); and Tencent-backed short video platform Kuaishou had participated in the fundraising.
In its latest move to enrich offerings, it announced in mid-January the acquisition of domestic counterpart Banana Gaming & Media.
After the acquisition, Banana Gaming & Media maintains its original operations as an independent subsidiary of the group. Wang Sicong, the founder of Banana Gaming & Media and the only son of Chinese tycoon Wang Jianlin, serves as the vice-chairman of VSPN’s Strategy Committee.
Before these more widely known funding rounds, VSPN had completed several investments from a group of investors largely from mainland China. In July 2016, VSPN had raised a combined 640 million yuan ($98.7 million) in its initial funding round. In a filing with the Shenzhen Stock Exchange (SZSE), Shanghai-based display-advertising provider Focus Media disclosed its role as the deal investor of the round with a transaction of 300 million yuan.
The firm’s early backers also include Sequoia Capital China, China Media Capital (CMC), China Jiansheng Sports Industry Fund, Guangdian Capital, and Averest Capital.