3XP: Is It Too Early for Web3 Esports Organizations?
Mike Ovecka talks about how to build web3 esports and highlights potential industry pitfalls including excessive aggression and disregarding grassroots initiatives such as small community tournaments.
In the nascent world of web3 gaming, guilds, players and developers have recognized the potential for esports to be a growth driver for the industry. However, some critical questions have been raised: Are these games ready for competitive play? Are they games that players actually want to play competitively? Could it be too early to start esports organizations in web3?
At the inaugural 3XP Web3 Gaming Expo, Mike Ovecka, YGG Head of Esports, shared his insights on what it takes to build a successful esports organization, especially in web3. The goal of 3XP is to drive industry growth through tournaments and expos while educating mainstream gamers on web3-enabled games. The 2023 event was organized by Community Gaming, an all-in-one platform offering esports infrastructure to all key stakeholders in the industry, and Game7, a DAO focused on uniting gamers through blockchain.
The panel, “Becoming a Web3 Esports Organization,” featured speakers Andrew Campbell from Crypto Unicorns, Dan Tinh from TSM, and Gage Dubose of Nouns DAO, with moderator Evany Chang, co-founder of Community Gaming. The panelists discussed what approaches from web2 esports can translate well into web3, such as growing a huge community first before focusing on competitive aspects.
The following is an excerpt from the panel where Mike brings in his wealth of experience as a former Program Manager at Blizzard for Hearthstone Esports. Mike discusses esports market development strategies, like preparing for new games by nurturing a diverse player base focused on different genres. It also includes Zyori sharing his take on how YGG is raising the bar — not only for web3 esports, but for the blockchain gaming scene as a whole. Listen to the full recording on YouTube.
3XP: Becoming a Web3 Esports Organization
Evany (5:05): When we're building into a new space, we're uniquely positioned to make changes. And so, what would you say you're hell-bent on avoiding in your positions to build in web3?
Mike (06:36): I think from the games perspective, their approach towards esports should be measured, and the game should be ready for it. First, you need a strong player base to engage them in a meaningful, competitive way. So, I think games shouldn't rush that too much. They should focus on grassroots a lot. Yes, to just build out a strong base. And then, from then on, you can engage it further with supporting community tournament organizers, and then maybe having some sort of structured competitive circuit that's run by a white-label event.
Apart from that, I think you should just try not to be very quick to scale up when you can and not overspend in the beginning. And then, when you don't get the KPIs or the results you're looking for — it takes [time], so just be patient. Focus on your competitive strategy, how you want to approach it, and then the players will come. And they'll play it if they love your game, and then continue playing it.
Evany (13:30): But if the esports aren't there yet and we're looking to build a web3 esports org, how do you apply web3 to building this esports organization when the games are not there yet?
Mike (15:20): I think as new games are coming out, you can take the approach that Nouns DAO is taking, so you can engage with web2 games. Or you could also just focus on web3 games and just foster your own community, keep making sure that it's growing, it’s engaging, and that you have a diverse player base to choose from — so that whenever an FPS comes out, you already have FPS players, whenever a mobile game comes out, you already have mobile players. So that's one way we're looking at it.
Hosting regular tournaments for various different types of web3 games and seeing what works, what doesn't, what sticks, what doesn't. And just making sure we have a large, diverse player base to choose from that we can then scale quickly into a game, [so] that when a web3 game does come out and becomes big and popular, we're ready to go and can scale quite quickly.
Zyori (17:36): One of the dark sides to crypto is that sometimes people make too much money too quickly. And that can really cloud business models or create the illusion of a business model. Play-to-earn did that for a lot of guilds that were like, "Wow, we're an amazing business. Look at all this money we're making. And we don't really know what's going on." That was obviously very short-lived.
There were many guilds, at least in the Axie ecosystem, that did fundraising off of that. And now, I think many of those guilds are really struggling because they don't really have a business model, engagement is down, and play-to-earn isn't printing money like it used to. There is still a subset of games out there that you can earn tokens through playing, but it's certainly not going to replace any kind of full-time salary.
So, I agree with that sentiment very much. Like, experiment, get time in the game, get reps in, but also recognize we are in such an early iteration of all this. You are part of the live experiment, and very few things are figured out or, quote, guaranteed to be working as we move forward.
The guilds that I'm still talking to seem to be pretty healthy — there are some big ones, like YGG, that are on a sort of different echelon compared to a lot of the smaller ones. But I've actually seen a lot of these guilds that resisted the urge to raise money, stayed a little bit more humble, and focused on having some sort of core cultural or shared connection that's at the root of the team. I think of Team Secret Gemini — that guild exists because of their fandom around Team Secret. But it's a high concentration of Filipinos that have a shared culture and a shared passion for blockchain, web3 gaming, and this emerging technology.
That guild is going to be there whether or not there's a hot play-to-earn game right now or not. And they’re, as a group, just trying to learn and embrace. OLA GG is another one. Their mission is to stay together and actually provide value for their members — education opportunities, gaming opportunities. They see play-to-earn and this whole emerging technology as one piece of delivering on that value proposition for their players and their fans.
Those are the groups that I see as healthy and embracing this in a very smart, heads-up, lower-risk way because they're recognizing none of this is figured out but we're really excited to be part of the journey.
Mike (19:49): I think it's really important to collaborate, whether it's with games or different guilds that are like-minded. Because at the end of the day, we want to move the space forward, and it doesn't make sense to just try to take it all for yourself. It's just way too early for that, in my opinion. So, yeah, collaboration with people that you share values with and that want to move the space forward, I think, is super important.
You can listen to the full recording on YouTube.
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