Astralis wants to delist from Nasdaq

It seems that what the critics have been saying for the last several years is true: Most esports teams are not investable. Not for now at least. FaZe Clan tried the experiment of listing the company on the stock market and failed miserably, losing 95% of its value in a very short amount of time.

Now, it seems that Astralis is preparing to admit defeat. The company’s shares plunged to less than 15% of their original values. They were listed at 8.95 DKK per share and now they’re worth almost 1 DKK.

Family photo on media day ❤️ pic.twitter.com/UsOskd0wf1

— Astralis Counter-Strike (@AstralisCS) July 13, 2023

An industry problem

We keep hearing it but nobody wants to believe it. Richard Lewis recently said that winter is coming for all esports organizations because they are all losing money.

Just several days ago we learned that BLAST, one of the biggest tournament organizers in CS:GO, reported a loss of 11.5 million Euros for 2022. That’s a massive amount to lose in a single year.

And let’s not forget that BLAST is perceived as being highly successful. The company practically has its own circuit inside CS:GO’s professional circuit, called BLAST Premier. The last CS:GO Major, which took place in Paris, was also organized by the Danish firm. But despite all of these achievements, the company lost millions of Euros. Why?

The answer is simple: esports events are not properly monetized. If you want to watch MMA or football or just about anything else, you need to pay money.

But in esports, you can just open Twitch or YouTube and watch a Major from start to finish without spending a dollar. Some have come to believe this is normal, but the business model of the entire industry is unsustainable.

Some will say that Astralis lost so much of its perceived value because its CS:GO team went from being the best in the world to being just an average team. That might be one of the reasons why investors stopped believing in the club. But the problem is a lot more complicated than that.

FaZe Clan had their best year ever in CS:GO in 2022 and they still went bust. Even after winning the Intel Grand Slam and getting all the attention of a community of 20 million people, on the stock market the company failed miserably.

Astralis and FaZe Clan are just two examples of the economic failure experienced by esports because of how it functions.

Header: Astralis