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Konvoy Ventures is a thesis driven venture capital firm focused on the video gaming industry. We invest in infrastructure technology, tools, and platforms.

Gaming Trends During COVID-19

Unity's report on how COVID-19 is impacting gaming, OWL spots go to non-endemics, VALORANT launch

2020 has been a difficult year for the world, and it has been particularly challenging in the United States with the unjust killing of George Floyd, Ahmaud Arbery, Breonna Taylor and others before them. The whole team at Konvoy fully supports the pursuit of full justice and believe we stand with the majority of Americans in our condemnation of the police brutality we sadly witnessed. Black lives are important to us, and we are committed to standing up against racial injustice.

As a firm, we invest in an entertainment sector that is effective at bringing people together and fostering community, but no industry is without its limitations and shortcomings. We continue to hope for a brighter future and effective policy changes in our country. Internally, we are taking active steps to listen, continue learning, and support as best we can. Our thoughts and prayers are with our nation as we reflect on a path forward together as a society.

Unity’s Report: Gaming Trends During COVID-19

Given the increased amount of time that people are spending at home, the video game industry has been thriving. Unity, one of the largest gaming engines in the world, released a report specific to trends they are seeing across their network of games since the start of the year. Read the full report here.

The granular consumer data in their report further confirms that there has been 1) an influx of gamers, 2) more time spent playing, and 3) more money spent. It highlights the point that video gaming is becoming a more integral part of people's lives, communities, spending habits, and social interactions. Highlights below:

PC Gaming

  • PC gaming is experiencing a 46% increase in DAUs (y/y)
  • PC gaming retention is up 11% for day 1 and 8.8% for day 30.

Mobile Gaming

  • Mobile gamers are installing 84% more gaming apps
  • Mobile gaming is experiencing a 14% increase in DAUs (y/y)
  • In-app purchases for mobile gaming is up 24% (y/y)
  • Ad impressions are up 57%, and ad revenues surged by 59% (y/y)
  • Click-through-rate for mobile gaming ads is up 34% (y/y)
  • Average CPI for mobile games dropped by 33% (y/y)

Takeaway: gamers are downloading more games, spending more, playing more, watching more, and are integrating gaming into their social lives more than ever.

OWL: Endemics Offloading their Spots to Non-Endemics

This week it was announced that Guinevere Capital would be taking over logistical control of Kings Row LLC, a subsidiary of Cloud9 that operates the Overwatch League franchise London Spitfire. To be clear, Cloud9 still owns the spot, but they are now partnered with a local investment group to help run the OWL team. This is different to a complete sale of the entity, as we saw with Immortal’s sale of the Houston Outlaws spot to Beasley Media Group.

Our view is that Guinevere Capital is testing the waters to potentially make an acquisition of the OWL spot. If Cloud9 were to exit the OWL, this would make sense given that the OWL viewership is down over 60% since Season 1 (yikes).

Takeaway: endemic groups (Cloud9, Immortals) are offloading their interests in the OWL to non-endemic groups (Beasley Media, Guinevere Capital). That’s not a great sign and should signal how esports team owners truly feel about the future of the OWL. I’ve said it before, but I think the OWL disbands within the next 24-36 months.

VALORANT Launched: A Case Study in Game Releases

Last week, Riot’s new Free-To-Play AAA game VALORANT was officially released to the public. Riot, while being known for League of Legends, designed this game with esports in mind and plans on hitting the scene right out of the gate. It’s worth noting that pro-players have started switching from CS:GO and Overwatch over to VALORANT. You can watch gameplay here on Twitch.

This isn’t the first time a game was developed to be an esports title (see: Wavedash which shut down in 2018 after raising $6M), but this time it’s with Riot Games who are responsible for one of the best esports of all time: League of Legends.

What also makes VALORANT special is how it was released. We’ve been seeing publishers leverage streaming platforms to release games (i.e. Apex Legends) but Riot took it one step farther. To play the beta, prospective gamers had to watch at least two hours of streams to be put into a drawing for a key. This created virality and drove up demand for early access. It also allowed the game to be tested at scale with hundreds of thousands of keys released through April and May. This helped Riot ensure a more robust gameplay before open access.

Takeaway: VALORANT is a great case study on the evolving landscape around game development and release strategies.