When Jason Lake left the law business in 2003 to form a professional competitive gaming team, friends and family told him it would never amount to anything.
Today, Lake is CEO of Complexity Gaming and global head of esports for GameSquare Esports Inc., the sister esports team to the Dallas Cowboys. Millions of fans worldwide compete and watch teams in tournaments for games like Apex Legends and Counter-Strike: Global Offensive. They also follow players who earn millions from tournament winnings and by broadcasting their games, strategies and entertainment content on live streaming platforms like Twitch and YouTube. When Lake thinks What the Future, he’s focused on maturing the industry and making it more inclusive and professional.
Kate MacArthur: How has the pandemic affected the growth of esports?
Jason Lake: There are data firms called Streamlabs and Stream Hatchet. They determined that Twitch viewership has more than doubled in the space of a year, Twitch being one of the primary outlets for streaming video games. That type of growth I don’t think would have been possible without the unfortunate pandemic and quarantine situations.
MacArthur: How do you expect that to trend going forward?
Lake: It’s only logical to believe that the esports spike will have a correction from the past year’s explosive growth. But we’ve permanently increased the ecosystem’s overall economic and cultural relevance. That changing of the cultural relevance and the melding that we’ve seen across sports, entertainment, movies, music and now gaming on the digital level will continue to accelerate.
MacArthur: Our research finds that 76% of American adults on average are not fans of esports. However, younger adults, people with kids in the household and Black and Hispanic consumers are much more likely to be fans.
Lake: Our core demographic [people under the age of 35] is arguably the most valuable demographic for marketers. Marketing departments in many companies are constantly asking themselves, “How do we market our services and create brand loyalty with the coming generations?” More and more, esports and gaming are a big part of that solution.
MacArthur: What do you have to change to grow the diversity of players and teams?
Lake: Just making sure that you have a level playing field that is safe and inclusive. You have to combat the toxicity of those that would hate on other gamers, whether it be for their sex or their nationality or the color of their skin. There has to just be zero tolerance for that type of behavior.
MacArthur: You just signed a women’s team. How will this advance your agenda?
Lake: By enabling these players to have a platform to share and support their perspectives and be leaders in the industry.
MacArthur: Where does gambling fit in esports?
Lake: Institutionalized and regulated esports betting will only increase the integrity and professionalism of what we’re doing. But we also have a duty to be sure that we do so in a way that’s regulated and done thoughtfully, so it’s a benefit to mature adults that want to engage with gambling in our world, but not allowing it to become a problem for people that might be too young to understand what that choice might mean.
MacArthur: How might sports and esports merge in the future?
Lake: I believe each will still maintain their own identity because esports is different in many ways from going outside and throwing a football with your friends. But in many ways they will merge into the social consciousness.
MacArthur: What is the promise of the metaverse for esports?
Lake: There’s already an online world called Decentraland where you can go in, walk around this metaverse in your avatar. You can buy property for thousands and thousands of dollars inside the game, and you secure those property rights via a decentralized blockchain ownership, similar to the backbone of Bitcoin.
MacArthur: Can you riff on what you think could happen there?
Lake: We’ll see digital sporting events, we’ll see digital concerts. We’ll see digital property where you can have a fancy house that you’ve bought and you own, and your friends can come in their avatars and watch sporting events together. It’s incredibly logical to assume that esports [competitive gaming] will definitely have a piece of that action.
MacArthur: In our survey there’s a contingent that thinks it’s boring to watch esports.
Lake: As you know, the youth of today are not interested in traditional cable television. They’re going to consume their content on YouTube, on Twitch, on TikTok, maybe on Netflix.
As far as how esports has presented on the competitive platform, that’s constantly in flux. Will esports be for everyone? Absolutely not. But will it garner a large enough global viewership and fan base to be a sports and entertainment juggernaut for the next 50 years? Absolutely.
MacArthur: Should we expect more activity with non-fungible tokens (NFTs) for esports?
Lake: We have an agreement with a trading card company called Epics. They make trading cards out of our players and they sell them, and we get a small commission and the player gets a small commission. Then a year, year-and-a-half later, you see them on eBay and they’re drastically marked up and the person who [initially] bought them makes a good profit.
The beautiful thing about NFTs is, if I sell an NFT of one of my star players or our logo, and then in two years that person decides to sell it and the value greatly goes up, I get a commission again. In 50 years, if that thing sells for a thousand times its original price, I get a commission again. It’s a game changer for that revenue stream in our business.