Esports Brand FaZe Clan Announces Plans for Public Offering via $1B SPAC Deal – What Sets It Apart?

eSports Titans FaZe Clan on the Intersectionality of Gaming, Content and Brand Partnerships, Advertising Week New York 2021, Great Minds Stage presented by Roundel, Hudson Yards, New York, USA - 21 Oct 2021
AWNewYork / Shutterstock.com

Entertainment and esports company FaZe Clan, a digital content platform created for the Gen Z and millennial generations, is combining with a special-purpose acquisition company (SPAC) to go public with a $1 billion valuation. The company will be listed on NASDAQ under the ticker symbol “FAZE.”

Top 10 Most Expensive Stocks: What Is the Highest Priced Stock Right Now?
Explore: How Will Teens and Gen Z Invest Their Money? Think Low-Risk, ESG and Roboadvisors

The Pitbull-backed company said it had entered into a definitive merger agreement to combine with SPAC B. Riley Principal 150 Merger Corp. Through the proposed business combination, FaZe Clan is positioned to become one of the only digitally native, youth-focused lifestyle and media platforms publicly traded on a U.S. national exchange, according to an announcement.

The company says it has a social media reach of more than 350 million and intends to use the proceeds of approximately $291 million to fund FaZe Clan’s global multi-platform growth strategy spanning content, gaming, entertainment and consumer products, including potential acquisitions.

Jonathan Anastas, chairman of Alpha Tech, told GOBankingRates that the FaZe Clan announcement confirms several sports and gaming-led trends.

First, the shift in generational-focus, as categories such as esports and MMA over-index for Gens Y and Z versus traditional sports.

Building Wealth

More: The Top Gaming Trends for 2021 (So Far)

“As ad and sponsor dollars shift, so will their valuations,” he said. “Secondly, and related to generational preferences, streaming is expected to have a 20%+ CAGR [compound annual growth rate] with esports expanding at a an 8-10% CAGR. Organizations that focus on these high growth spaces will benefit.”

Anastas added that another factor is that overall, sports valuations and rights deals appear to be increasing at a rapid rate as we move past pandemic challenges in the West and audiences return at record rates.

“Lastly, FaZe has shown clear thought leadership, scale leadership and the highest levels of cultural impact in the category. The biggest rewards and valuation multiples always go to the clear leaders,” he said.

Lee Trink, CEO of FaZe Clan, said in the announcement that the company, in its short history, has “evolved from a disruptive content generator to one of the world’s most decorated and successful esports franchises, and now into one of the younger generations’ most recognized and followed brands globally.”

“We believe FaZe Clan is becoming the voice of youth culture, a brand that sits at the nexus of content, gaming, entertainment and lifestyle in the digital-native world,” he added.

Building Wealth

See: Enjoy Online Gaming? Turn Your Passion Into a Side Hustle With These 5 Options
Find: How Much Money Do YouTubers Make?

The company’s other big-name investors include actor Chris O’Donnell, chair and CEO of Epic Records Sylvia Rhone, and rapper Yo Gotti.

More From GOBankingRates

Last updated: October 26, 2021

About the Author

Yaël Bizouati-Kennedy is a former full-time financial journalist and has written for several publications, including Dow Jones, The Financial Times Group, Bloomberg and Business Insider. She also worked as a vice president/senior content writer for major NYC-based financial companies, including New York Life and MSCI. Yaël is now freelancing and most recently, she co-authored  the book “Blockchain for Medical Research: Accelerating Trust in Healthcare,” with Dr. Sean Manion. (CRC Press, April 2020) She holds two master’s degrees, including one in Journalism from New York University and one in Russian Studies from Université Toulouse-Jean Jaurès, France.

Untitled design (1)
Close popup The GBR Closer icon

Sending you timely financial stories that you can bank on.

Sign up for our daily newsletter for the latest financial news and trending topics.

Loading...
Please enter an email.
Please enter a valid email address.
There was an unknown error. Please try again later.

For our full Privacy Policy, click here.