This Reg CF Offering is made available through Dalmore.
This investment is speculative, illiquid, and involves a high degree of risk, including the possible loss of your entire investment.
Reasons to invest in velocity esports
Hypergrowth of esports globally
Proprietary Tech Stack
Omnichannel brick and mortar, and online game play model
Executive Team - highly skilled, proven track record
Expansion in key markets underway
PERKS
$250
MINIMUM INVESTMENT
Rewards
Velocity Esports jersey.
$1,000
investment
Rewards
Velocity Esports jersey
+ baseball cap
+ a gaming headset.
$2,000
investment
(Earn 10% bonus shares on your investment)
Rewards
Velocity Esports jersey
+ baseball cap
+ a gaming headset
+ be a guest co-host on our upcoming Weekly Velocity Next tournament recap show on our Twitch channel!
$5,000
investment
(Earn 10% bonus shares on your investment)
Rewards
Velocity Esports jersey
+ baseball cap
+ a gaming headset
+ be a guest co-host on our upcoming Weekly Velocity Next tournament recap show on our Twitch channel!
+VIP Experience for 2 days at our flagship Las Vegas location for up to 6 people with unlimited gaming.
why invest now?
As a guest-focused company, we have invested and intend to continue investing in developing proprietary technology around our database of guests, how they play, where they play, what they play and other ways to engage their attention in gaming and social activities. At the present early stage, we are in an investment phase with respect to this part of our technology. Over time, management believes the scale and capability of our data-driven efforts will give us superior knowledge (to the location-based industry) about how our audience interacts with each other and with the gameplay experience.
We believe the economic payoff from these investments will come in the form of a higher-than-industry rate of repeat visits to Velocity’s online and location-based properties and greater lifetime player value. The nature of technology development means that we expect to continue developing our technology for the foreseeable future; however, we will deploy it in phases that we believe will allow us to realize increasing return on investment in each operating property along the way.
As of July 31, 2022, we have opened our Cincinnati, Ohio venue; we have opened our flagship location in Las Vegas, Nevada, and we will be opening in Chicago, Illinois around the first half of 2023. Our management team intends to use proceeds of the offering to increase the number of venues beyond these initial three, to grow our online esports offerings, to continue building our technology stack including proprietary components, and for general corporate purposes.
Top tier entertainment and tech industry management team with track records of building successful concepts from zero to Nasdaq.
Focused strategy to capitalize on exciting esports category.
Strategic ability to apply technology and automation to gain superior operating leverage.
Opportunity to create omnichannel esports market leader.
mission statement
Velocity is a next-generation gaming company. Our team imagined the concept for Velocity around three simple core ideas:
People love to play games.
Game play and viewing are best enjoyed socially.
Esports offers engaging experiences that transcend place.
We offer at least three core gaming components in our venues: esports lounges, a social gaming lounge featuring billiards, shuffleboard, pinball and classic video games, and an arcade game floor.
Esports is the strategic product that allows us to create a truly omnichannel business that engages our players and guests both in-venue and online. We create a 360-degree social gaming experience for energetic gaming communities.
esports
Weekly Tournaments by Velocity
Velocity Esports hosts weekly competitive tournaments for gamers worldwide that include today’s hottest titles like Rocket League.
testimonials
HYPERGROWTH OF
esports
Like the movie and music businesses, gaming is a hits-driven business with revenues concentrated to top titles.
Hundreds of new games are released annually across PC, console, mobile, and other gaming platforms and industry total revenue well exceeds $179 Billion.
(Source: International Data Corporation (IDC))
Certain, select titles drive large esports communities. Generally, the video game publisher industry views esports as a strategic segment because those titles that become popular as esports tend to have a longer, more productive life span than non-esport titles do. Publisher support for esports and the openness of publishers to third-party activity around their titles varies depending on overall publisher strategy. The audience for esports is vast, and the target market is young and compelling, so investments continue in developing compelling gaming experiences, including several major acquisitions of game publishers by larger technology and entertainment companies since the start of 2021.
Esports can simply be defined as competitive activity around a video game. Because multiple titles are considered viable esports, esports is more akin to a decathlon featuring multiple events than it is to a single sport with a clear governing body like American football. Game tastes and which esports are most popular vary significantly across international borders, and also vary somewhat in regional, domestic consumption. Some examples of top esports include: Call of Duty, Fortnite, Overwatch, Counterstrike: Go, League of Legends, and PUBG (all registered trademarks of their respective holders).
Esports is a fast-growing category. Velocity drives revenue from multiple demographics, as gaming is popular across a wide age range. However, we primarily target a highly valued audience: millennials, and GenZ. Our target demographic spends more on entertainment than any other generation, and by survey 78% of millennials value spending money on experiences rather than physical goods. The esports audience continues to grow among both esports enthusiasts (individuals who watch esports at least once per month) and occasional viewers
(Source: NewZoo Global Esports Market Report), and the size of the esports audience is comparable to NFL Football viewership (Source: Goldman Sachs).
The market for esports is driven by a combination of a large number of both players and viewers across a diversity of popular game titles, giving companies in the space a number of different ways to build profitable followings.
According to Grand View Research, the global esports market was valued at $2,008.4 million in 2021. It is expected to expand at a compound annual growth rate (CAGR) of 21.9% from 2022 to 2030. In terms of audience size, according to NewZoo, the global esports audience will grow +8.7% year on year from 2021-22 to reach 532 million.
Esports enthusiasts—those who watch esports content more than once a month—will account for just over 261 million. The number of esports enthusiasts will grow to 318 million in 2025, with a CAGR of +8.1% (2020-2025). In 2025, the total audience will surpass 640 million.
We view ourselves as broadly competing for the consumer’s activity dollar against any other entertainment activity that they may choose. That said, we follow the ecosystem of large, online and location-based entertainment businesses and can use the successful outcomes of others to help envision a clear, differentiated, profitable path for our own success.
Some of the large entertainment companies we track include: Netflix, Savvy Gaming Group, Callaway’s Top Golf, AMC Movie Theaters, Dave & Busters, Bowlero, Caesars Entertainment. We also track many smaller esports and location-based entertainment operators.
company at a glance
ESPORTS EXPERIENCE
Esports is the core of our imagination. We built our esports lounges to offer the latest and most popular PC and console games in a social setting. Built for the comfort of the most intense players over hours of play, the lounges are designed to allow both individual play and participation in esports tournaments. Our Velocity Next esports tournaments give players the chance to compete with their peers weekly for prizes across a popular slate of game titles that can include: Rocket League, Valorant, Smash Brothers Ultimate, Knockout City, and others. For Velocity Next tournaments, we select titles with built-in large, national gamer communities where we have a competitive advantage in building community that includes both online and in-venue components. Velocity Next live streams on leading social media channels.
SOCIAL GAMES
Bar classics like billiards, shuffleboard, foosball, pinball, and classic video games continue to offer the opportunity for lively and fun game play. In some of our current and future venues, we also offer bowling. The environment inside our venues is high energy and features esports, music and sports content that create an event-like atmosphere.
ARCADE GAMES
Arcade and redemption games continue to offer compelling experiences for nights out nationwide. Our mix of games combines racing games, sports-based titles, first-person shooters, midway games, pinball, and crane and other redemption games with prizes for all ages. Our guests can play for hours with the ease of self-service or assistance of our friendly team members.
COMPLEMENTS TO GAMING
To our players and guests, we offer a selection of craft cocktails and beer, a food menu of American and Mexican favorites, and various gaming-related merchandise for sale or for prizing. As a gaming destination, we position these items to be part of the gaming experience, increasing dwell time and actively seeking the add-on sale. We price the complementary items to high margin, along the lines of the classic movie theater popcorn.
GROWTH
Strategy
Our strategy is to offer compelling gaming and gaming themed experiences across in-venue and online, with a social element overlaying it for our target market of Gen Z and younger millennials (ages 18-27). We envision growth coming in four phases: 1) establish platform, 2) drive increased marketing and operational efficiencies, 3) grow platform, then 4) accelerate scale of operations, revenue and cash flow. By their nature, these phases overlap each other, and the Company’s management has a history of positioning their businesses to take advantage of opportunities that emerge to accelerate or to complement their baseline plan.
PHASE I
Initial Platform Strategy
Into early 2023 - As this business requires some scale to deliver superior economics to its investors, the founders of the company lined up a platform of three venues with which they had personal experience to accelerate the path to scale. By the term platform, we mean a stable, scalable business entity on top of which we can drive rapid organic growth and growth by acquisition. Both the senior and next level management team of the business has worked together previously over a period of years. We believe that combining assets we know with people we know, while continually evolving player experiences, gives us the ability to execute in an agile and efficient manner through the first phases of launching the company. A dense, higher-energy configuration within our venues has proven to be the most optimized for our target guest. We expect to continually modify our gaming mix as our concept and consumer trends evolve.
PHASE II
Marketing and Operational Efficiency
2Q 2022-late 2023 - We take a data-driven approach to both marketing and operations. Overlaying compelling creative work, our marketing emphasis is on performance based online platforms such as social media, search, and games. We expect to continually evolve and improve our performance with marketing across omnichannel. We focus marketing within communities that align our gaming mix with our target demographic of Gen Z and younger millennials. However, we drive revenue from multiple demographics, as gaming is popular across a wide age range and we are building an inclusive culture. Management is always seeking opportunities to improve operating efficiencies. We believe, based on management’s experience, that we can achieve greater than incremental operating efficiencies in areas like procurement, labor-saving technology, and price optimization that will drive profitability improvement across the platform.
PHASE III
Grow from Base Platform — 2023
Our business has the opportunity to expand both organically and through acquisitions. In considering organic growth of our venue-based platform, we seek locations that are either dense urban or near-in suburbs, have concentrations of our target Gen Z and younger millennial guests, the ability to achieve excellence in space utilization and activation, above-median income, potentially areas in a cycle of refresh and renewal, and potentially featuring concentrations of mixed-use. We can either take an existing entertainment or large format restaurant site and convert it to the Velocity concept or we can take a white box space and create a venue from scratch. The former allows better capital efficiency while the latter has a space optimization advantage, so we seek either. Regarding potential acquisitions, management would consider complementary opportunities that accelerate our business plan and are forecasted to be accretive, keeping discipline around readiness and ability to execute.
PHASE IV
Accelerating Scale
2024 and beyond – Our objective for the next phase of growth is to scale both linearly with respect to venue count and with significant operating leverage with respect to earnings. At the same time, we believe we will be in position to potentially take on an additional technology-based opportunity that leverages the power of our growing player database and experience in creating compelling gaming experiences. In addition to being a distribution channel for game companies to reach the most passionate players, skill-based video game contests, tournaments and peer-to-peer competitions with cash prizes and other prizes is a high margin area of interest and experience for the company’s founding team and there are a number of routes to become involved with it. Our focus for later-stage growth will be on delivering rapid and consistent earnings growth while improving the power and reach of our brand.
EXECUTIVE
LEADERSHIP
Mr. Kaplan has 30 years of experience in driving enterprise growth, with specific expertise around delivering innovative digital experiences. Mr. Kaplan has a track record of successful company exits for investors.
In addition to his role at Velocity, he also serves as co-CEO & President of Artemis Strategic Investment Corporation, a $200 million NASDAQ-listed SPAC. Additionally, he served as Chairman & Chief Executive Officer of esports and entertainment company GameWorks from 2018-2021. Mr. Kaplan was also the co-founder and President of VitalStream, a global network for delivering streamed video content that listed on NASDAQ.
Mr. Kaplan has held C-Level management positions in the following four Nasdaq listed companies: Artemis Strategic Investment Corporation, Quality Systems, Inc., Internap Network Services Corp, and VitalStream Holdings, Inc.
Mr. Wanger is an experienced entrepreneur with a track record of success. His expertise is in software-based systems. Mr. Wanger formally served as Chief Technologist for Impossible Objects and served as technology sector analyst and portfolio manager of the William Harris Investors Technology Fund.
Mr. Wanger is the founder and co-founder of several technology companies, including Interactive Simulations, Patra Corp and now Velocity Esports. Mr. Wanger also has extensive experience with both private and public companies as an investor and advisor.
Mr. Rosenbaum is an entrepreneur, founder, capital markets advisor and marketing expert with a focus on helping startups and emerging companies accelerate growth. He has strong experience in the health and wellness, consumer brands, and esports and technology sectors. Mr. Rosenbaum has 25 years of experience as an investor and advisor for both public and private fast growth companies, working on structuring cross border listings, public listings, M&A, turnarounds, and corporate development. He was also President of a multimedia marketing firm for 15 years.
Mr. Rosenbaum also serves as President of Mindshare Holdings, Inc., where he advises start-ups and emerging growth companies. He was also recognized with three Telly awards as a media producer.
Mr. Deane has nearly 30 years of leadership experience across multiple industries with high-growth companies. His extensive experience is evidenced by scaling early-stage companies with combined revenues of over $820M. Mr. Deane guided many emerging companies to raise capital, go public, and other related financial matters.
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