Top legal tips for eSports start-ups – Part 1: incorporation, investment, IP and employees

ESports is a growing sector with a great deal of excitement surrounding it. Newzoo estimated that revenues in the eSports industry would reach US$696 in 2017, increasing to US$1.5 billion by 20201, which shows the sector presents a real opportunity for start-up businesses.

The sector looks like it will continue to grow as mainstream media giants are now broadcasting eSports to millions of viewers (for example Sky and ESPN both have their own dedicated eSports content) and entertainment platforms are increasingly turning to eSports to capitalise and tap into the growing revenue streams that eSports’ companies offer2. Outside investment from international enterprises is also more common in recent times3.

As lawyers working within the eSports industry, we frequently have meetings with entrepreneurs and eSports industry veterans who have fantastic ideas for start-ups, like new competitions, teams or eSports services. As well as developing their breakthrough idea, we also work with these on the more practical and less glamourous side of setting up a business. The purpose of this article (Part 1 of 3) is to provide eSports start-ups with a rundown of some of these practical considerations that will allow them to build a sturdy base for their start-up to flourish. Specifically, it examines the following key areas:

• Incorporation

• Investment

• Intellectual Property

• Employees and Consultants

Parts two and three will move on to consider topic including advertising, sponsorship, data protection, events, and regulations.