Why Research: E-Sports Events Highlight the Need to Be Active Industry Participants

 In Market and Investment Insights

Technology Portfolio Managers Brad Slingerlend and Denny Fish believe that, to be successful it’s important to understand the entire ecosystem, which means going beyond management meetings and becoming deep industry participants. Attending events such as the Overwatch League launch in Burbank, California, helps with their research into the video gaming industry.

Key Takeaways

  • Active research means going off the beaten track of company meetings and becoming deep industry participants by attending in-person events such as the launch of the Overwatch League e-sports franchise
  • 2018 may be the first year more people watch video games than actually playing them
  • Participating in such events and talking to end users, customers, engineers, researchers and others involved in the technology field, helps generate a more accurate picture of the likely impact of innovation

Brad Slingerlend: We’re here in Burbank for the first match of the regular season of the Overwatch League, which is an e-sports gaming league that has just started.

Denny Fish: It’s people that spectate and watch other people play video games. I think to get comfortable with just the idea of the value that something like this could potentially add, we have to get into the middle of it. Because I think it is the only way you can appreciate it.

Slingerlend: My name is Brad Slingerlend. I am the Co-Portfolio Manager of the Janus Henderson Global Technology Fund.

Fish: Denny Fish, I am a Co-Portfolio Manager on the Janus Henderson Global Technology Fund.

Slingerlend: At Janus Henderson investors, we are very focused on becoming deep industry participants. In order to do that, we need to go off the beaten path. We’re not just talking to management, we are not just meeting with other investors or other financial industry participants. We’re really meeting with the people who are building the businesses, the competitors, the customers, the users, the R&D engineers, the software engineers, the salespeople to duly try to understand that whole ecosystem of what will make a company successful for the long term.

Fish: The Overwatch League is currently the first of its kind if North America. It has been built from the ground up around a game called Overwatch.

Slingerlend: It is really the first attempt at creating a true full league and professional e-sports franchise.

Fish: Many speculate that this year will be the first year that people actually spend more time watching video games than playing video games.

Slingerlend: The Overwatch League really creates something akin to more like an NFL or Major League Baseball or the NBA where you have got teams and players, team owners, sponsorships, fans, merchandising, tickets, the whole thing. And it’s really built around cities. It’s the first e-sports league built on cities, which is the way most professional sports leagues are built.

Fish: It’s interesting, because it is very much like major league sports, but in some respects it’s even more intimate, because the players aren’t completely protected from the fans, they can come through, they can high-five, and people are going to line up around the corner of this building later, so that they can get in on a first come, first serve basis and actually get the most attractive seats.

I think what’s most important about it is you can’t appreciate what is really going on with these sports until you actually come here and participate in an event.

Slingerlend: This is an early-stage development for the video game world and ecosystem.

Fish: That’s why we are here. You know, we just like to validate in terms of how we are thinking about things, we like to get to things early, we like to participate just like anybody else would in the industry to really learn what’s going on on the ground floor.

Slingerlend: I think much like rock ’n’ roll developed in the ’60s, we are seeing a real new culture emerge around gaming. And e-sports is a big element of that and I think to extend the rock ’n’ roll analogy, that was a very difficult thing for the parents of those teenagers’ generation to understand. I think just like that, the e-sports is a difficult thing for current people to understand, including investors. So what we want to do is try to understand this hopeful shift as much as we can and really immerse ourselves in that culture the best that we can.

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