Challenger Video Game Betting App Backed by Former MGM Resorts CEO Jim Murren
Posted on: March 16, 2022, 10:42h.
Last updated on: March 16, 2022, 02:12h.
Jim Murren, who led MGM Resorts as CEO for a dozen years before departing the casino giant to head up Nevada’s private-sector COVID-19 task force in 2020, is investing in a software firm that seeks to revolutionize video gaming.
Challenger is a Windows-based software application that video game players can download and install to their computer hardware. The software allows players to compete against one another for actual cash.
San Diego-based Challenger announced this week that it has secured and closed its seed fundraising round. Investors, a company statement revealed, include Acies Acquisition Corp., a blank-check special purpose acquisition company (SPAC) Murren co-created in 2020.
The mass market of video game players still have no option to participate in skill-based contests at scale,” said Challenger founder and CEO Chris Slovak. “In North America and Europe alone, there are more than 300 million gamers over the age of 18 who play regularly and have no solution to complement their gaming experience with cash-based contests.
“Challenger was launched to overcome this problem,” Slovak added.
Murren has been on an investing blitz since departing MGM. Through his SPAC and personal investments, the former casino executive has stakes in Challenger and predictive gaming app developer Boom Entertainment.
But Murren’s biggest play to date came last June by taking Playstudios, Inc. public through a merger with his Acies Acquisition Corp.
Challenger is currently only available for Counter-Strike: Global Offensive being played on Microsoft Windows. The company plans to soon add several other popular titles, including Fortnite, Call of Duty: Modern Warfare, and Valorant.
The Challenger software, the company says, is a passive installation that allows for in-game betting between players. The application coordinates players competing for money in a variety of ways, such as credit per kill and last player standing formats.
Gamers of all skill levels can participate, as players are grouped based on their recent performance in real-money competitions. Challenger autonomously facilitates the exchanging of credits, and players can convert those credits into cash.
New accounts are given a small allotment of credits. Players additionally receive a first-time deposit match. To satisfy potential concerns that the software isn’t facilitating unlawful online gambling — something Challenger argues it is not — the platform deems the contests as skill-based endeavors. Players are also limited to depositing $1,000 a month.
Challenger plans to use its fundraising round to implement new titles to the software and bring the app to Xbox and PlayStation. SeventySix Capital and Revel Partners are additional private equity investors in the Challenger seed round.
Data research firm Insider Intelligence says the esports industry, or competitive video gaming, currently has 30 million monthly esports viewers in the US alone. The industry is expected to generate more than $1 billion in revenue this year for the first time.
The budding market has attracted much investment.
“As competitive video games continue to integrate into popular culture, global investors, brands, and media outlets are all paying attention,” the Insider Intelligence esports review said.
Challenger’s business model has less to do with the facilitation of peer-to-peer video game wagering, and more to do with the data the app will gain from its installations. Challenger automatically monitors a gamer’s gameplay and possesses the ability to translate that data into behavioral insights.
Challenger says its patented AI technology will provide the video gaming industry with invaluable intelligence.
“[Challenger] is positioned to have the most unique and expansive dataset on gamer behaviors, as it expands to cross-platform, cross-game, and cross-studio esports wagering,” said Wayne Kimmel, managing partner of SeventySix Capital.
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