Twitch is turning its considerable revenue machine to esports organizations and players.
Long-standing North American brands TSM and Cloud9 are the first organizations to partner with the platform, the company announced today. Twitch will now “act as their official sales representative to interested brands looking to reach their combined audience” (that’s either TSM or Cloud9 and Twitch, not TSM and Cloud9 together), with TSM and Cloud9’s players continuing to stream exclusively on Twitch.
“Both teams are unique, so we’ll structure their agreements with sponsors accordingly,” Twitch’s VP and Commercial Director for Esports, Kristen Salvatore, told Dot Esports.
The streaming giant is hoping to attract new non-endemic sponsors into the esports and streamer world by acting as the exclusive sponsorship sales representative for major esports organizations.
The partnership comes just a few months after TSM CEO and Founder Andy “Reginald” Dinh sparked a global conversation about revenue generation in esports. Reginald called out Riot Games and its popular title League of Legends in an interview and on Twitter, saying that the revenue ecosystem made it almost impossible to stay in League due to the costs of maintaining a team amid dwindling sponsorship opportunities. This led Riot to introduce crowdfunding via in-game items for the first time during its recent World Championship, with a percentage of the item revenue going directly to organizations and teams. This crowdfunding initiative more than doubled the Worlds prize pool this year, from the Riot-funded $2.13 million to $5.07 million.
“We’re thrilled Twitch will be representing TSM for future sponsorships,” Reginald said in a statement. “This will allow us to focus on developing long-term careers for our players and creating content for our fans.”
Since it was bought by Amazon in 2014, Twitch has rapidly expanded both its staff and its user base. The site currently brings in over 9.7 million daily active users. The streaming site partnered with Psyonix earlier this year for the Rocket League Championship Series, and has been involved in the Capcom Pro Tour for some time — the company’s first direct foray into the esports market.
“Twitch’s global sales team is nearly 100 people strong, with offices literally around the globe,” Salvatore told Dot Esports. “We’ve built a robust sponsorship sales organization within that team who’ll be leveraging the infrastructure and reach of our group as a whole on the direct sales side. And we’ve built a sponsorship operations group devoted entirely to the tactical execution of sponsorships, ensuring top-notch service to both sponsors and our teams.”
Twitch did not say how this partnership will affect TSM and Cloud9’s existing sponsorship deals, if at all.