Kitamen targets US$510k fundraising via ECF to grow its eSports presence
By Kiranjit Kaur Sidhu March 22, 2018
- Rapidly growing fanbase, 1.8 million in 2016 expected to grow to 2.4 million in 2018
- Funding to be used for physical gaming epicentre, technology and marketing
WITH its community hubs focus and with 17 e-sports outlets in Malaysia, Kitamen Resources Sdn Bhd is seeking to provide a more comprehensive and communal based approach to e-sports compared to the conventional cybercafes ubiquitous in Malaysia.
From its beginnings, offering gamers console games from a serviced apartment in KL, Kitamen has recently launched an equity crowdfunding (ECF) campaign on Ata Plus, a licensed ECF platform in Malaysia. The company is seeking to raise US$510,000 (RM2 million) for a maximum equity of 9.6%, thereby valuing it at US$5.3 million (RM20.8 million).
The funds raised will be used to build an epicentre inclusive of event space, e-sports specialised zone, the Kitamen Dojo and a coworking e-sports space expected to be built within a few years. The funding will also be used for working capital, improving their platform as well as branding and marketing. On this front, Kitamen has partnered with brands such as Sony Interactive Entertainment, Riot Games, Intel, Acer and Lazada.my.
With a rapidly growing fanbase, estimated at 1.8 million in 2016 and expected to grow to 2.4 million in 2018, a growth rate of 33%, Kitamen hopes to quickly capitalise on this opportunity within the local market. But, it is not the only one eyeing the market. In a crowded market where various players are aiming to grab a piece of the fast growing e-sports market, how is Kitamen planning to differentiate itself?
Its chief marketing officer Chua Ken Jin acknowledges that traditional cybercafes are catching up by slowly realising the extent of the e-sports market. However, Kitamen differentiates itself by appealing to gamers, both casual and serious players, by promising a more holistic gaming environment by providing a one-stop gaming community.
What it means is that Kitamen offers more than just a physical space to play by promoting a more complete gaming ecosystem through the concept of Dojos and the introduction of a national e-sports leaderboard. A Dojo is conventionally a space known for immersive learning which Kitamen hopes to bring across to the Malaysian e-sports scene.
In terms of their targeted investors, Hazman Hassan, chief executive officer and founding partner says the primary aim is to gain support from users within the e-sports community itself. Besides the expected return on investment that any investor will expect, Kitamen will offer tangible rewards such as tournament tickets and community membership.
The rewards are designed to encourage engagement, which happens to be a challenge in the Malaysian gaming ecosystem. “The Malaysian market is not so participative in terms of engagement,” Hazman acknowledges.
Hazman is not just targeting Malaysian investors but is also open to gamers from around the world to invest in Kitamen. Furthermore, director and co-founder of Ata Plus Kyri Andreou adds that investors are becoming increasingly aware of the booming e-sports market. “The general profile of people who participate in ECF tend to be a little bit older than gamers but comprise of tech-savvy individuals who can relate to the offering,” he says.
Incidental to Kitamen’s goals of growing the e-sports community, it also anticipates an increase in job creation within the market. Over the past year, Kitamen has created over a 100 job opportunities with 80% being part-time roles. Kitamen targets university students who are e-sports enthusiasts to take up these part-time positions for its e-sports events.
While the majority of roles are part-time, nonetheless, it is pushing towards more sustainable jobs within the industry. One current approach taken is to create awareness among students of future job opportunities within the e-sports industry. In the current gaming ecosystem, while professional gamers can take home millions in earnings, these careers are only for elite gamers. For everyone else, Hazman hopes to create high paying job opportunities in the next five to 10 years.
These roles include e-sports commentators, analysts and simulation experts which Kitamen hopes to bring to the table in the future.