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As the esports industry continues to develop, one thing that has become apparent is the growing urge for brands to diversify their operations — whether that be an esports organisation developing a lifestyle brand alongside competitive ventures, or tournament operators shifting their events into other titles such as mobile gaming.
Diversification has always been fairly common in esports. Take FaZe Clan, for example — an organisation which recognised that competitive success doesn’t have to be, and probably shouldn’t be, the only option. NRG Esports recently announced the ‘NRG Castle’, a 20,000-square-foot content house in LA. OverActive Media’s recently announced plans for an esports venue buttress the point.
Another company that has branched out is merchandise company We Are Nations. Despite being one of the largest apparel firms in esports, over the last couple of years We Are Nations has diversified its operations, strengthened its position in the sector, and looked to bolster other markets, despite most of this period being marred by a pandemic. In May 2020, the firm launched Nations Ventures, a venture capital fund focused on early-stage companies. Since its inception, the fund has gone on to invest in Aggregated Media, Obsesh, HyprCarry and Smerf.
The Esports Journal spoke with Patrick Mahoney, Co-founder of We Are Nations and Nations Ventures’s General Partner, about why the fund invested in those companies — as well as the company’s other verticals.
Investing in a community, for the good of esports
Almost any company wants to make money, and We Are Nations is no exception. But the team also has a conscience. Mahoney, a former punk rocker who cut his teeth in music merchandising, wants to invest in companies that are rewarding — financially and morally.
“The thinking was, any time you can tap into a community, you’ve got a good place to market,” Mahoney said when asked about Nations Ventures’s investment in Smerf. “If we can get involved in building communities, it will allow us to understand them and ultimately sell to them.”
Smerf is a gaming-focused social platform that helps people find, and create, communities. As of right now, the platform focuses on the League of Legends and VALORANT communities. However, the additional funding from Nations Ventures will see the introduction of more titles in the future.
Nations Ventures’s investment in Smerf last September was the fund’s first. Mahoney’s intention as to why the platform came first soon became clear: to him, creating a better, more inclusive community in the gaming space, particularly for females, is crucial.
“We have to make sure this community is safe and welcoming,” he said. “You should want to be here. No one wants to go to a place where they’re being harassed. Smerf is hitting all the right buttons. In the late 80s, I was playing in a punk band, and we thought we were woke as hell, but we had no girls in the band. It’s insane that we thought we were so progressive.”
Following Nation Ventures’s Smerf investment, the firm then went on to invest in more familiar grounds — the apparel sector.
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Back when Nations Ventures first launched, the firm announced its intention to invest in companies that don’t compete with We Are Nations’s core business. So, it came as a surprise to see that the fund’s second investment was in HyprCarry, an Australian influencer-merchandise and media company.
“Every rule is made to be broken,” Patrick Mahoney said.
To read the rest of this article, go to The Esports Journal Edition 8, page 26