Twitter and gaming, fintech in gaming and esports, gaming as a leader in interactive media
Copy Link
In 2019, Twitter saw 1.2 billion tweets about gaming (+20% y/y). The gaming community spends quite a bit of time on Twitter as well as other platforms like Discord and Twitch. For Twitch, viewers spent 9.6 billion hours watching content on the platform in 2019 (+13% y/y).
Going forward, generic platforms (Twitter, FB, Reddit) will continue to be used by the gaming community, yet in the past few years we’ve seen the rise of dedicated solutions for this digitally native audience. Current examples include companies like Discord (chat/voice), Twitch (streaming), or Kotaku (news). I expect this to continue.
We are actively watching how the theme of how fintech is being applied in gaming. It is clear that the monetization per minute for the video gamer is highly under monetized when compared to other entertainment sectors. Also, the esports fan is also under monetized at around $2-4 per fan (annual) vs a traditional sport like the NFL (~$200/fan annually). To close both of these gaps, this not only means that the value prop has to continue to expand but consumers will be increasingly monetized in new ways going forward. To facilitate this healthy innovation and progress, fintech has a key role to play in a global cross-boarder gaming environment.
In startups, there are large market opportunities for the companies that can further enhance the gamer/viewer experience while also creating the reasonable expectation that not everything is free. Within the gaming community especially, this is a difficult balance. Even so, many companies have succeeded at striking this balance and we expect the volume of companies who succeed at this to increase going forward.
According to Earnest, in a survey done in 2018, 64.6% of gamers in the US have at least a bachelor’s degree. Also, according to the US Bureau of Labor, the median income for individuals with a bachelor’s degree is ~$61k per year. In 2018, the St. Louis Federal Reserve showed that the individual median income in the US at ~$33k. Following these statistics, ~65% of gamers make roughly 2x the median income.
We are watching this data very closely as we continue to invest in the video gaming space.
We came across this quote on a Hacker News post recently and thought it was interesting:
“Games are just the forefront to interactive media. Apps are getting "gamified" and pretty much anything that can be interactive will be because it's the next level as far as creative and communication medium. At first it was just paintings etc, then photography, then film, and now games which is really interactive digital content.”
Games are special because when you play them, you're largely in control. Your actions determine the outcome and the experience you have. It's slightly different and more nuanced when you introduce multiplayer formats, but the core fact remains that whatever you do influences what happens.
That level of interactivity makes for an extremely engaging experience, which doesn't exist elsewhere in media. It's so compelling that other mediums started "gamifying" their content, mimicking the lessons learned in video gaming.
This is most famous in mobile apps and tools (as the quote above mentions), but does anyone remember the Choose Your Own Adventure (www.cyoa.com) books? These were children's books where the reader had to make decisions for the main character along the way. These were a great success.
Within the gaming space, we're even starting to see audience interactivity take hold, which is a main reason why we invested in Muxy (you can read here why we invested in this team). We're excited to see how this trend in interactive media continues to unfold not only in gaming but also in other industries across the board.