Frisco-based Complexity Gaming said Wednesday that it has sold to GameSquare Esports, a publicly traded esports firm, for $27 million, and both companies say they want to build a global esports powerhouse.
Toronto-based GameSquare acquired Complexity in an all-stock transaction that values it at $33 million. GameSquare trades on the Canadian Securities Exchange.
Dallas Cowboys owner Jerry Jones, an investor in Complexity, said he hopes the deal will “fast-track” revenue growth for the esports company he and real estate mogul John Goff acquired in 2017.
The combined company expects to see $28 million in revenue in 2022.
As part of the deal, Jones and Goff will increase their stake in GameSquare, and the two are leading investors in a $13.7 million nonpublic stock offering for the Canadian company. Dallas Cowboys chief financial officer Tom Walker and Goff Capital president Travis Goff will gain seats on the GameSquare board of directors.
The Jones family, Goff family and Jason Lake, Complexity’s founder and CEO, will collectively own 47% of the combined company. GameSquare also entered into a marketing partnership with the Dallas Cowboys.
Lake will also become the global head of esports for GameSquare and continue to lead Complexity, the company said. In his expanded role, Lake will seek to grow GameSquare’s footprint globally.
The company will remain at The Star in Frisco, operating out of its headquarters, which was completed in 2019 with a seven-figure investment from Jones and Goff. It’s also extended its lease on the space in Frisco for several years, Lake said.
“We get to be sister companies alongside other esports verticals, marketing, merchandising … and other companies that [GameSquare is] looking to acquire, which provides us diversification in an industry that can be difficult to monetize at times,” Lake said.
Lake described the impact of the pandemic as a “double-edged sword” for esports organizations.
“On one side, we had skyrocketing viewership and all-time highs and engagement with gaming and esports. But on the other hand, as you know, sponsorships are a large part of an organization’s revenue,” Lake told The Dallas Morning News. “And a lot of these companies were struggling, or they were kind of on pause and waiting to see how this was going to play out. So they weren’t super eager to necessarily execute larger deals or new deals.”
The acquisition combines Complexity’s winning track record in competitive esports with GameSquare’s content creation, sales, marketing and branding expertise.
Complexity prides itself in its esports competition and fields teams in powerhouse gaming titles including Counter-Strike, Apex Legends, Valorant, Fortnite and FIFA. Prize money for esports continues to balloon, and the Complexity Apex team recently competed in a global tournament with a $2.58 million prize pool. The company has won more than 140 championships and, at 15 years, is one of the longest-standing esports organizations in the country.