Why Invest in This Canadian Fan Engagement Start-Up?

Source: Streetwise Reports   10/20/2021

Here’s why New York City investment group Long State has invested in GameOn Entertainment Technologies, an interactive media disruptor that just teamed up with Chibi Dinos.

“New research from Silicon Valley Bank and Campden Wealth reveals that the US$418 billion [venture capital] space is attracting younger investors to commit significant portions of their family fortunes to early investment opportunities,” reports Wealth Professional.

Streetwise Reports recently sat down with NYC-based private investment
firm Long State to learn why it put its money on GameOn Entertainment Technologies (GET:CSE;GMETF:OTC;9E7:FSE).

“I do believe Matt can build the company.  The business model is focused on licensing and revenue sharing.” — Jessie Chen, Director,
Long State Investment

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Long State invests in growth-oriented companies in Australia, Canada, Chile, the European Economic Area (EEA) countries, Fiji, Singapore, South Africa, the United Kingdom, and the United States.

Like many private investment firms, Long State does not publicly disclose its portfolio mix, but we heard through our network it invested in GameOn and they agreed to talk about that.

The GET Game Plan

GET provides broadcasters, TV networks, OTT platforms, leagues, tournaments and sportsbooks with B2B fan engagement technologies around sports, television, and live events. You can read more about it here.

Long State principal Philip Ho has over 25 years of corporate finance, private equity, and investment management experience. Prior to joining Long State, Ho was the senior managing director and head of global investments at a $1.5 billion U.S.-based fund manager.

“Our investors are primarily in the real estate business, and they want their first money investments into other areas,” explains Ho. “We manage that portion of their wealth, driven primarily by growth sectors around the world.”

“They already have big-name partnerships. We expect to see revenue starting Q4 this year.” 

We asked Ho what value Long State brings to the table for its portfolio companies, beyond capital.

“It depends on the sector,” explains Ho. “We invest in the battery space from the upstream side: lithium, graphite, nickel, cobalt. We can make introductions to potential offtake partners in Asia. On the pharma side we help companies navigate regulatory approvals and clinical trials as well as marketing and distribution.”

“We like the Canadian model,” continues Ho in reference to GameOn. “Typically, private placements are not related to a prospectus. We invest when we truly believe in the value of the company and the fundamentals, we can get additional considerations like warrants that will boost investment returns.”

GameOn has a dynamic management team led by CEO Matt Bailey (Brooklyn Nets, Barclays Center), Chief Product Officer Santi Jaramillo (Dapper Labs, NBA Top Shot, EA Sports), and Ryan Nowack (Madison Square Garden, New York Knicks, New York Rangers), as well as its directors J Moses (Take-Two Interactive), Shafin Tejani (Victory Square Technologies), Liz Schimel (Apple News), and Carey Dillen (YYOGA).

Why the GET Game Plan Works

Let’s take a step back for a second and look at the whole playing field. Thirty years ago, advertisers would buy time on network TV and hope that viewers didn’t nod off or go to the washroom during the 30 to 60 seconds their ad was playing.

Spoiler alert: They did.

At the end of the day, the eyeballs paid for were not the eyeballs delivered.

Enter commercial avoidance technology (PVRs), which severely disrupted the traditional advertising model.

A few years later, and you have social media platforms like Facebook and Instagram. These venues are successful in large part because the viewer is actively engaged: Reading updates. Leaving comments. Uploading photos. “Liking” other posts, etc.

GET’s fan engagement technology ramps up the concept of interactivity — converting passive users into active super fans.

“We live in an adrenaline economy,” write Bailey and Moses in a coauthored article in Sports Business Journal. “Everything we do is centered around engaging and stimulating the senses at breakneck speed whether a consumer is scrolling through curated videos on TikTok, wagering on the next play in an NFL game, or live chatting with fellow fans of ‘The Bachelor.’”

GET’s fan engagement technology ramps up the concept of interactivity — converting passive users into active super fans.

“Attention spans are short,” continues Sports Business Journal. “So it’s up to brands and content providers to quickly get their message across while evoking a response from the viewer that keeps them coming back for more, especially in today’s market that offers an endless supply of options from broad to niche for each individual.”

“Regardless, consumers will want what they want, when they want it, and without having to search for it. It’s a never-ending stream of engagement and adrenaline.”

How GameOn Is Playing for Keeps

One of GameOn’s most important features is that it is “zero lift” for its partners.

“The production teams of our partners don’t have to do anything,” explains Bailey. “Being programmatic and automatic is a powerful selling point to the partners we’re working with. Our engine writes, results, and distributes prizing, requiring no human production.” This of course also means no overhead costs incurred.

“GameOn can create a community around any content,” confirms Ho, “whether it’s a TV show or a sports event. It’s a very vibrant business model and we also like that they can white-label the product, as they did with Indian cricket.”

Cricket is the #1 sport in India and accounts for almost 85% of the Indian sports economy, and it is the #2 most watched sport in the world.

On June 17, 2021, GameOn Entertainment Technologies announced an exclusive partnership with India’s entertainment super app MX Player that will introduce cricket prediction games for mobile. Exactly four months later, GameOn’s predictive technology roll-outed for the ICC Men’s T20 World Cup, which hit the pitch on Sunday October 17, and MX users were front and center to all the action.

Cricket, the second-most watched sport in the world, is the fifth most popular sport in Canada (after baseball), and in India, it is the #1 sport.

“Cricket accounts for almost 85% of the Indian sports economy with IPL (Indian Premier League) being a major contributor,” reports Exchange4Media. “The bulk of Indian sports revenue comes from broadcast and sponsorship, contributing 65% and 30%, respectively, while ticketing revenue accounts for only 5%.”

GET’s free-to-play game will be available to MX Player’s large and diverse user base for domestic and international cricket events, tournaments, and leagues.

“MX Player is an entertainment super app that integrates all forms of entertainment on one platform — including video playback, streaming video, and gaming (in select markets),” states GameOn.

“It hosts a wide library of premium content across 10 languages, including a critically acclaimed slate of MX Originals/Exclusives, movies, web series, and TV shows.

MX Player has now spread its footprints across 12 markets including United Arab Emirates, United States, Canada, United Kingdom, Australia, New Zealand, Bangladesh, Nepal, Afghanistan, Sri Lanka, Maldives, and Bhutan.”

GameOn has secured distribution and white-label projects with several partners.

White-labeling is less sexy than branding but often more profitable — since it comes without the expense and operational drag of marketing and distribution.

GameOn’s value proposition is significantly de-risked by a partnership
with Victory Square Technologies Inc. (VST:CSE; VSQTF:OTC-US) — a tech incubator that “builds, acquires, and invests in promising start-ups, then provides the senior leadership and resources needed to fast-track growth.”

VST targets the Fourth Industrial Revolution with a portfolio of 20 global companies using AI, VR/AR, and blockchain.

“With real skin in the game, we’re committed to ensuring each company in our portfolio succeeds,” states VST. “Our secret sauce starts with selecting start-ups that have real solutions, not just ideas.”

“Victory Square owns about 22% of GameOn,” confirms Jessie Chen, a director at Long State, “and they have a very strong record. We also see Matt Bailey bringing a lot of intelligent people to the team and board.”

“I do believe Matt can build the company. The business model is focused on licensing and revenue sharing. They already have big-name partnerships. We expect to see revenue starting Q4 this year,” says Chen.

“The Family Offices Investing in Venture Capital Report reveals that the average family office venture portfolio comprises 17 direct investments and 10 fund investments, and within the next 24 months, family offices expect to make 18 new investments,” states Wealth Professional.

Last spring, GameOn closed a $5.8 million oversubscribed financing.

Long State’s investment in GameOn is an example of a U.S-based boutique investment office backing a young Canadian technology company.

GameOn has a market cap of CA$18.8 million, and it trades in a 52-week range of $0.225 and $0.98 with 61,696,536 million shares outstanding.

Want more information about getting in on the game? Read the full story here.

Disclosure:
1) Lukas Kane compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. He or members of his household own securities of the following companies mentioned in the article: None. He or members of his household are paid by the following companies mentioned in this article: None. His company has a financial relationship with the following companies referred to in this article: None.
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