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Largest Fantasy eSports Website Raises $12 Million

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The phenomenom known as eSports (short for "electronic sports") is growing at a rapid pace, and a new $12 million Series A round of financing for a company entrenched in the space is a great sign for the industry as a whole.  In fact, it only took the company Vulcun a total of eleven weeks of existence to secure the $12 million raise, which was assisted by Vulcun's new partnership with venture capital firm Sequoia Capital.

The raise by fantasy eSports website Vulcun is one of the largest to date in the eSports industry, which is quickly becoming a real area of focus for venture capitalists.  An eSports competition, also referred to as competitive gaming, matches individuals against each other in a variety of video game genres with cash prizes awarded to those who prevail against the competition.  The eSports industry has become so popular that many of the competitions are now live-streamed for supporters of the participants and fans of eSports gaming to engage in the events as spectators.

Vulcun launched in January 2015 and has already paid out $760,000 in prizes.   Its prize pool has grown from $250,000 to $4 million in only three months of existence .  The top winner on the platform has earned over $30,000 in that limited time-span.

Those numbers led to a host of investors taking interest in Vulcun.  The company's Series A round of financing of $12 million included the following participants: Matrix Partners, Universal Music Group, Battery Ventures, Creative Artists Agency, Crosscut Ventures, Naval Ravikant (Angellist), Mark Pincus (Zynga), Kevin Chou (Kabam), Lars Buttler (Trion), Joe Kraus (Google Ventures), Steven Fan (Yahoo), Kevin Moore, Edward Fu and other angel investors.

The industry as a whole is showing signs of progress as fantasy operator Vulcun accepts an influx of capital to keep building out its platform.  Research firm Newzoo has released a report stating that the eSports industry is currently worth roughly $200 million and revenues are predicted to grow to $465 million within two years.  According to Vulcun co-founder Ali Moiz, industry estimates indicate that more than 120 million people will tune in to an eSports competition in 2015.  Moiz's position is that eSports is already the second most-watched sport in North America after the National Football League.

Vulcun does not host competitions.  Instead, it is a fantasy league for eSports, including the popular games League of Legends and CounterStrike.  The service allows users to draft their favorite eSports players and compete against others for cash prizes, which have increased as the platforms user base has been strengthened and solidified.  Both free and paid contests are offered on Vulcun's platform.

"We really believe in the long-term potential of eSports and Fantasy Leagues," Sequoia partner and Vulcun board member Omar Hamoui.  "Vulcun allows fans to really participate in the thrill of competitive gaming at the highest levels, without the need to go pro.  Vulcun founders Ali & Murti have a strong background in running a successful eSports team, and passionately believe in what they do."

Darren Heitner is a lawyer and the Founder of South Florida-based HEITNER LEGAL, P.L.L.C., which has a focus on Sports Law and Entertainment Law.