Esports and gaming production company Wisdom Gaming has let go of 17 staff in a round of layoffs, former employees told Esports Insider.
The layoffs are the fourth round of cuts by Wisdom in about a year as the company faces financial hardship.
Former staffers told Esports Insider that the layoffs were a cost-cutting measure, as Wisdom Gaming has struggled in what is widely considered to be a difficult time for the industry.
However, two former employees alleged that mismanagement and poor leadership had contributed to the difficulties the company is facing. Nepotism, inexperienced hires and a lack of understanding of the esports space were cited as examples.
The cuts follow around 10 layoffs made in February, which themselves followed further cuts in both November and the summer last year, former staffers said. According to the company’s LinkedIn profile, Wisdom Gaming has 83 workers, though it is unclear how many of those actually work full-time at the company.
A Wisdom Gaming spokesperson told Esports Insider in an emailed statement: “After a comprehensive evaluation process, Wisdom Gaming has developed a streamlined structure to better position itself as it continues to navigate a turbulent market.
“Unfortunately, this process results in several difficult but necessary organisational changes, including the elimination of 17 positions. As a startup, this reduction is felt deeply across the company, and we are forever grateful to those employees who have contributed to our mission of creating spaces where everyone can experience the joy of gaming.”
Ashley Pinney, Wisdom Gaming’s Vice President of Marketing Communications, had earlier confirmed the layoffs in a tweet on Tuesday. “Today was rough with many talented and outstanding people being laid off from their jobs [at Wisdom Gaming],” she wrote. “Will be signal boosting as many as I can in the hopes that they can find their next adventure soon.”
The Esports Advocate reported in its coverage of the layoffs that if Wisdom Gaming does not raise capital soon, it could be out of business or bankrupt within a few months. The outlet also reported that the layoffs were a product of ‘systemic mismanagement issues’.
Based in Minnesota, United States, Wisdom Gaming is a media, production and marketing company. It offers white-label tournament production and organisation, broadcast services, marketing and events. The company has notably worked with Riot Games on its North American Teamfight Tactics tournament series.
Wisdom also operates an esports venue-cum-production studio in Minnesota. The company has raised $14.2m (~£11.5m) to date over two funding rounds, according to Crunchbase.
Wisdom Gaming has expanded its remit significantly in the past few years from its initial focus on digital media and marketing, which may have contributed to its current difficulties. Wisdom previously operated an esports team, Torrent Gaming, but shut its operations down in February.
The layoffs come amid broader financial difficulties across the esports industry, as companies and teams of all sizes have contended with a downturn in confidence and investor sentiment in esports combined with wider macroeconomic challenges.
Teams such as Copenhagen Flames, eUnited, X7 Esports and CLG, amongst others, have all shut their doors in the past 12 months.
UPDATE 01/06/2023: This article has been updated to include an emailed statement from Wisdom Gaming.