Blog

  • Blog #4.0: What eSports Business should I launch?

    So you’re ready to step up to the plate and begin growing your own eSports career. Awesome! Before you take too many steps, allow me to stress a couple of lessons I wish I knew before I started! 

    Lesson #1: Unique ideas don’t mean much.

    I get a million emails at Day[9]TV in which people mysteriously allude to a brilliant idea that they just had. “We need to meet and talk,” they say. “Our idea is worth millions. We should cooperate and join forces.”

    They would like to tell me more but first require that I execute a non-disclosure agreement. Because the idea is that good. Then they warn me: the “idea” is gathering momentum. If I don’t act swiftly, the startup train will leave the station without me and I will end up crying in my beer.  

    My response to this is generally to roll my eyeballs.  I myself get about twenty fabulous business ideas in the shower every morning, staff them in my head while brushing my teeth and imagine growing them into giant monopolies over breakfast. This is enormously pleasurable to me, but has very little to do with the realities of running a business.

    So this blog is intended to challenge the notion that a start up is all about the “idea.” Don’t get me wrong: a great idea is very, very important, but far more important is how you execute that idea. How you sell it, how you grow it, how you keep it moving.

    I see too many people in eSports who have a fantasy that if they could just come up the “winning idea,” they could have a business empire.

    Pet Rocks
    Credit: Today is a good day / photo on flickr

    These folks often cite the pet rock business or the hula hoop business or PlentyofFish.com as examples of a “winning idea.” “That pet rock guy made a killing!” they say. “He did it all by himself out of his apartment! That could have been me!”

    The truth is that very few ideas in any marketplace are all that unique. I am pitched the same ideas over and over again by eSports fans, all of whom passionately believe that they are completely original in their thinking. Many of these ideas are almost identical to ones I myself dreamed up in the shower. In fact, the other day I pitched a totally unique idea to Twitch TV, and they promptly sent me to a website where someone was already doing the very thing I’d described. 

    I see some folks crumble when they are confronted with the competition. Like a guy rejected by a girl, they mourn the loss of “what could have been.” They feel like their idea has been stolen. They give up.

    Don’t do this.

    Again, the point is that a start up or a product is not as much about the “idea” as it is about the execution of the idea. Think MySpace, which was an internet sensation until Facebook came along and steamrolled it. Simply do your research on your competitors and figure out how to do things better.

    Credit: Google Trends - Myspace vs. Facebook

    Lesson #2: Keep the competition out and continually innovate.

    The corollary to this is that someone is always going to be trying to beat you at your game.  Even if you come up with a completely original idea, there may folks out there who will be trying to walk off with your market two minutes after you launch. How?  By appreciating your idea and learning from your mistakes. By doing what you already do, but doing it on a grander scale, with more money and more employees. By scaling faster. There is nothing immoral about this. Many ideas are surprisingly difficult to patent or surprisingly easy to spin off into legal variants.  Always be looking over your shoulder and staying one step ahead.

    Three innovators, working different ends of the same niche
    Credit: Solo / photo on flickr

    This leads us to another important question you should be asking yourself when formulating your business idea: how easy will it be for someone to imitate me and push me out of my own niche? What entry barriers exist to keep potential competitors out? 

    Ideally, you want to create something that is not only compelling and unique for users but also difficult for competitors to imitate. Alternatively, you want to quickly grow your user base to such a critical size that your competitors can never catch up to you.

    Remember you are working in a rapidly evolving marketplace, where the rules and the players change all the time.  You are going to want to keep reinventing your business as you grow, so that you stay ahead of everyone else. (They call it “pivoting” in Silicon Valley). 

    Did you know that YouTube started as a video dating site called Tune in Hook Up before its founders changed direction? Or that Flickr was originally conceived of as part of an MMO role playing game? Or that Shopify (which by the way, has a kickass StarCraft team in the After Hours Gaming League) started as an in-house purchasing solution for an online snowboard business?

    This means you shouldn't be wed to your original idea to the point of rigidity. Keep it fresh and keep it moving. You may launch one eSports business model and end up running something completely different within a year. That’s fine! You probably wouldn’t even have thought of business number two, if you hadn’t launched business number one. Get into the eSports marketplace now, start to meet people, and start to test your ideas until you find something that works.

    Lesson #3: Have a clear plan for gaining audience or customers.

    “How do I gain audience or customers?” This is the big question, the one many people don’t want to think about. In fact, I am always amazed by people who tell me they want to build a business but don’t want to get into sales. In fact, they get a funny look on their faces when I mention marketing and sales, as if I just farted in their direction. They hate the very idea of selling. They want to be eSports idealists, not corporate hacks. But the truth is that a great idea is worthless unless you can drive users or audience to it and unless you can generate money to cover your day to day operational expenses.

    Start thinking about all the ways you are going market your business from Day One. (We will give you more detailed advice on this in future blogs).

    I had a business mentor once tell me that a lot of businesses are by necessity 60-80% sales effort and 20-40% production effort. In other words, money is needed—lots of it—on the front end in order to drive the engine which operates the company on the back end. This was a real eye opener for me. Until then, I’d had a kind of naïve “build it and they will come” attitude.

    The Bottom Line.

    I’ll say it again: business is like StarCraft. You need to know your opponents’ strategies, you need to know your build orders, you

    Terran eSports entrepreneurs
    Credit: Dunechaser / photo on flickr
    need to have your timings down. You need to practice and learn. You can talk a good game, and still suck on the ladder. You have to implement your strategies in a real world environment. You have to understand that for all your careful preparation, your opponent may pull a cheese rush and totally kill you off before you even get started. Don’t play StarCraft competitively unless you want to seriously study the game and do your homework. What’s one of my favorite sayings? Probes and pylons! That’s the simplest way to say “it’s all in the execution!”

    Likewise, don’t gamble on an eSports business until you learn the ropes. Be prepared for lots of setbacks. Be nimble and flexible about changing your tactics. Understand your own shortcomings. Don’t quit your job tomorrow, run up debt on your credit cards, and chase an eSports dream without a solid game plan, a lot of skill, and a coach or two. Start small, gain experience, and make calculated bets that slowly raise the stakes.

    As Steve Jobs said: “Follow your heart, but check it with your head.”

    Next up:  Producing eSport Tournaments 101

  • Blog #2.5: Your responses to Blog 2.0

    I was so intrigued by your responses to Blog #2 (“Getting a Job in eSports”) that I decided to bump back Blog #3 and jump into the current discussion.  I’m calling this Blog 2.5.

    Frankly, some of your feedback is almost better than the blog, itself.  I am especially grateful to Guardian504, Eagles8908, entropyfails, alexpenn, robzgod, Sk-aBhorsen, Furyio, and striderstone for their real world anecdotes and advice about working in eSports. This is exactly the kind of dialogue I wanted to stimulate when I created the blog.  Please continue contributing!  In fact, if ANY of you have useful anecdotes, resources, or corrections which improve the original post, please, please comment away so that they’re permanently available for future readers.  :>

    The remarks and questions I am referring to can be found in the comments section to the original blog post, as well as in this  thread on /r/Starcraft and in this thread on /r/LeagueOfLegends.  (Welcome Summoners! I am delighted to see gaming communities outside StarCraft jump into this eSports conversation!) 

    Credit: Hogan "kamRA" Carter

    Ok, back to the actual blog.

    It was suggested in the scReddit thread that the success I have had in eSports is a result of:  

    1. My personal acquaintance with an “old boys' club”
    2. The fact that I “got in early” before the eSports market organized and streaming was widely established
    3. Dumb luck.  

    This leaves readers wondering: “How can I do it if I don’t have #1, #2 or #3 like you?”  The answer is that the road, while hard, is much more straightforward than it looks. :D 

    1) Dat “old boys' club.” 

    Yes, there are figureheads already established in eSports.  They have a jump on you.  You will be competing with them.  So what?

    Any newcomer trying to penetrate ANY market will always have to contend with the status quo.  Always.  You are the newb.  They are the old timers.  They paid their dues.  They earned their spurs.  They helped build the industry.  They are now profiting from it. That’s the way it works.  They don’t “owe you” a place at their dinner table.  (Although they’d probably welcome you there.)  

    So, let go of them conspiracy theories!  That kind of mentality is an unhelpful crutch that will keep you from making progress.  It’s like screaming “imbalance!” every time you lose a game as a result of your own ineptitude.

    The fact there is a status quo does not preclude you in any way from coming in and disrupting what those “old boys” have built or from working alongside them or erecting something new of your own.  

    The key is to innovate and carve out your own niche.  This is a well established principle in business. There is a cycle of innovation and disruption that is happening continually in every industry out there, but which is especially vigorous at present.  New people are constantly coming to the table with a new angle on old marketplaces.

    For example, Apple disrupted the long-established music publishing industry with iTunes.  ITunes is now itself being disrupted by Spotify.  Netflix disrupted Blockbuster.  Netflix is now being challenged by Hulu, Amazon, Time Warner and others.  In our own eSports world, Riot and Valve are challenging Blizzard.  It’s called market dynamics.   I will point out that none of these players wrung their hands and whined that they weren’t being invited to the dinner table by the “old boys club.”  They just figured out an angle and moved in.

    Credit: CNN Money Bytes beat bricks.

    So get disruptive!  Stop making excuses, get on the competitive business ladder, and start climbing. 

    Most of the personalities you know in the StarCraft community began by pushing an idea with persistence, not by having special connections.  Ben “MrBitter” Nichols, perhaps best known as a caster at NASL, began by creating a show 12 Weeks with the Pros. Chris "ChanmanV" Chan began by creating his show ChanmanV's Pro Corner and securing a sponsorship from Razer.  Hell, when I began the Day[9] Daily, the ONLY thing I had was a sub-par webcam and StarCraft experience.  I didn’t know anything about encoding, production, lighting, talking in front of a camera, or even any people at any of the major eSports organizations (except perhaps my brother).  But, I showed up every day, kept pushing, and after 150 episodes, finally received an invite to my first live event. 

    Did knowing people in the StarCraft community help me?  To a degree.  TeamLiquid did send me some traffic, for which I was grateful. Keep in mind that I spent a decade building relationships over there, and for a long time I, too, was just another new kid on the block, starstruck and tongue-tied by the likes of community heroes like Nazgul and djWHEAT and Sir Scoots. But those connections were no substitute for the hard work of churning out content.

    Could knowing people in the gaming industry help you?  Yes.  It’s called “networking.”  It is an important business skill.  I’ll try to do a blog on that, as well.  But there are no magic keys to the kingdom, no gatekeepers who are going to “make” or “break” you.

    2)  “Getting in on the ground floor.” 

    Yes, I was lucky to get into live streaming and casting early. 

    Credit: Norlando Pobre/Flickr CC BY

    But note that I got into streaming and casting after having failed at any number of other opportunities.  I never became an admin on TL, I never flew to Korea as a pro gamer, I failed as a podcaster, and I gave up on blogging before I ever started.  These were all emerging opportunities available to me as a result of Web 2.0, and I failed to take advantage of them.  And before I knew it, others had succeeded in my place. 

    But we live in exciting times.  Technology is rapidly evolving, and I realized that there were new opportunities cropping up all the time.  I just kept looking for my niche.

    I eventually seized upon live streaming not because some community crony whispered in my ear, or because I realized I was getting in on the ground floor of something big, but just because I wanted to talk about StarCraft.  I’m lazy, and I thought it would be faster and easier to talk than write, and since it was live, if I f***ed up I would have an excuse not to go back and fix my commentary.  (This was important because I was busy with grad school).  

    In short, I stumbled into streaming and had no idea it was going to become as successful as it did.

    I started out with 57 viewers.  After a while, I noticed the Daily was ranked as one of the top streams on LiveStream.  At first, I was baffled by this.  In fact, for the longest time, the two most popular shows on LiveStream were the Day[9] Daily and the Arab news service Al-Jazeera.  Since the news agency had more than 500 employees (I looked it up) and I only had me, broadcasting from my room with my grainy webcam, I figured this was an aberration, and the Daily couldn’t really be all that special.  Later, when I moved to UStream and then Twitch.TV, I received frantic e-mails from LiveStream asking me to come back.  Only then did I realize the scope of the Daily’s influence.

    Husky, Himself   Credit: www.waytaoshing.com

    The Daily led to casting opportunities.  But even after I got in on the ground floor of live streaming, and started churning out content, I continued to screw up and not clue in to important opportunities.  

    For example, I had no idea that YouTube was going to be as an important a marketplace for video content as it is.  (I thought it was for cat videos and machinima.)  I had no idea there was an explosion of smart video content creation going on over there. I completely ignored YouTube as a content platform.  Meanwhile Husky saw that opportunity, ran with it, and quickly earned his place in the community.  He now has a second popular YouTube channel.  I will probably never catch up with his YouTube success.

    Does this bother me?  No!  I have other fish to fry.  Besides, even YouTube will not last forever.  Already, there are murmurings that YouTube content creators are moving elsewhere, lured by the potential of other disruptive technologies and platforms. Put another way:  there are opportunities to get in on the ground floor of something new every day.   ESports is in its infancy.  There are people right now, jumping on board emerging technologies, who will be the “old boys' club” of tomorrow.  It could be you. 

    How will you know about these opportunities?  Because you will do your homework. You will do a ton of market research (I will suggest how in the next blog), so that you understand what is coming down the pike technologically, and how it might work for you. 

    3)  Dumb Luck.  

    Have you seen me play Magic the Gathering?  I never draw land ever.  Ever.  I am totally unlucky.