Fnatic is in financial hot water according to reports, with the organization possibly having only 3.46 million euros left, enough to cover two more months of operation, before hitting the bottom of the well.
Fnatic is one of the longest-standing and most well-known esports organizations in the world. The company was founded in 2004, making it one of the oldest in the industry as well. Throughout that time, the team has won numerous international titles for League of Legends, CSGO and Valorant.
The European powerhouse is not solely based on the success of their esports, however. Fnatic has a number of different gaming peripherals that they sell including mice, keyboards and headsets. These are accompanied by an extensive clothing line that covers everything from jerseys to sweatpants, giving the esports giant a wide variety of revenue streams.
With 2024 on the horizon, a number of esports teams are re-evaluating their financial situations and acting accordingly. Valorant Champions winners Evil Geniuses are allegedly cutting players’ pay by 50% while teams like 100 Thieves have had to cut high-paid players and leave esports titles like Apex Legends.
According to reports, Fnatic may have to do the same. And sooner than you may think.
Fnatic struggles despite having multiple outlets for its income
Back in September, a Twitter user by the name of Express LoL raised awareness of the current financial status of Fnatic. The Commercial Registry UK report showed that Fnatic had over 20 million euros in accumulated losses with over 2 million lost in 2022 alone.
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Founder and CEO of Fnatic Sam Mathews responded to the claims that Fnatic was losing money by explaining that the organization has more ventures than just what the public has access to.
You need to understand that fnatic exists across many entities, Fnatic Gear, Deathbrush etc etc. We have a holding company the reason for this is because we have franchise assets per game held separately, for various reasons. I'm sure XL is the same. So you can look at one…
— Sam Mathews (@sammathews) September 21, 2023
“You need to understand that Fnatic exists across many entities, Fnatic Gear, Deathbrush etc,” said Mathews. “We have a holding company the reason for this is because we have franchise assets per game held separately, for various reasons. So you can look at one entity and get only 1/6th of a picture, not the whole picture.”
The auditor for Fnatic explained that the organization had measures in place to continue operating in the instance of a downturn in the economy and profits. This includes one or several rounds of fundraising, delaying the hiring of staff, the sale of certain assets and contributions by existing shareholders.
As of now, it is reported that the esports organization has only 3.46 million euros left for the remaining months of 2023 according to a report from Sheep Esports, which equates to just under two months of operating costs. Mathews has not made any additional statements regarding Fnatic’s financial situation a the time of writing this article.