Financial Indicators and Growth Forecasts of the Ukrainian Esports Market

Where the Money Comes From: Funding Sources

Esports in Ukraine became an official discipline in 2018. By that time, the country already had several serious teams and even a professional esports organization, NAVI. The funding sources for the industry are quite classic - they can all be roughly divided into four groups.

First: Sponsorship and Advertising

Classic or, if you prefer, fundamental. Sponsorship plays a leading role in sports, and esports is no exception. Major brands actively sponsor esports teams and events, seeing it as an opportunity to attract a young and active audience. In 2023, the volume of sponsorship contracts in the Ukrainian esports market exceeded $10 million. And this is during wartime...

It's important to note that more and more global brands are willing to support Ukrainian esports players. Previously, it was mostly companies related to computer technology: Logitech, Intel, Samsung, but now advertisers from other markets are coming: Red Bull, Coca-Cola, KFC.

Second: Tournaments and Prize Funds

This part of the income is also straightforward. Teams participate in tournaments and compete for prize money. The winners take it all. A striking example is the esports organization of investor Maksim Krippa, NAVI, which has already made history in world esports. NAVI has earned over $10 million just from playing Counter-Strike.

Third: Media Rights and Broadcasts

Selling rights to broadcast esports events is also an important source of income. Streaming platforms such as Twitch and YouTube Gaming pay for exclusive rights to show popular tournaments.

Fourth: Merchandise and Ticket Sales

Sales of team merchandise and tickets for offline events also contribute to income. In 2022, the sale of merchandise for Maksim Krippa's esports organization NAVI brought in over $1 million, even during the pandemic year.

A Few Words About the Role of the Investor:

Sponsors, prizes, merch, etc. – all of this is, of course, very good. But how do you reach the level where all these "perks" become available? The answer: no way without an investor. Start-up and working capital have never been canceled in any industry. In simple terms, money makes money.

The already mentioned NAVI organization is a prime example in this regard. It was founded in 2009 by young and enthusiastic esports players who wanted more. But the dream would hardly have come true without the support of philanthropist Murat Jumashievich, known as Arbalet. After some time, the philanthropist lost interest in NAVI, but the money was still needed.

At the peak of a severe lack of financial support, in 2018, the proposals of NAVI were responded to by the well-known Ukrainian entrepreneur and investor Maksim Krippa, who already had an esports asset in his portfolio in the form of a stake in the Maincast broadcasting studio. Maksim Krippa became the majority owner of NAVI in 2018.

And in 2020, Maksim Krippa signed an agreement to obtain full rights. It is unknown what motivated the investor, but from NAVI's side, it was a lucky ticket. Maksim Krippa signed an agreement that involved fulfilling several conditions. Interestingly, NAVI representatives do not disclose the list of conditions, but it is known that it took Maksim Krippa two years to fulfill them and an unknown amount of money.

Of course, not every team or esports organization is as lucky with an investor as NAVI was with Maksim Krippa. And for this reason, not all Ukrainian esports teams show such results.

Where They Spend: The Expense Side of the Industry

Despite significant revenues, esports organizations also incur large expenses. Among the main expense items are salaries and fees for players. Top players earn significant amounts, which requires large investments from teams. For example, top NAVI players cost Maksim Krippa $500,000.

Also, the costs include the amounts spent on organizing and holding tournaments. Holding major tournaments requires significant investments in venue rentals, equipment, marketing, and other expenses.

And, of course, training bases and infrastructure cost a lot of money. The time when a team could live and train in a three-room apartment on the outskirts of Kyiv is over. Now, the same Maksim Krippa is buying the Parus business center, rumored to be for the purpose of creating an esports hub.

As can be seen, despite decent revenues, the esports industry also spends a lot. Which is generally good, as the market loves the movement of funds.

Forecasts for 2025

If you believe the analytics and expert community, the Ukrainian esports market will be in good shape in 2025.

The expected income from sponsorship contracts will be about $20 million. With good play, prize money could bring teams about $5 million a year. The same amount will come from selling broadcasting rights. Another plus/minus $3 million can be earned from merch and ticket sales.