SoloMid Corporation have agreed to terms of a pending contractual agreement that will see it receive $25 million in investment from Silicon Valley-based venture capital firm Bessemer Venture Partners, sources close to the esports company and the firm told ESPN.
Bessemer is the lead investor in an open funding round, contributing over half of what SoloMid is seeking to raise in the coming weeks and months. The specific evaluation for SoloMid was not disclosed, but its peers -- such as Cloud9 and Immortals -- have recently been evaluated around $105-140 million in total worth. SoloMid, which holds both Team SoloMid and a number of popular gaming websites like ProBuilds, is believed to be worth similar or more, according to sources.
SoloMid and Bessemer will now recruit additional investors for the round, which are likely to include other esports-interested firms or wealthy entrepreneurs, as well as the possibility of professional sports teams. The round is ultimately expected to be larger than the $25 million that Bessemer will contribute. It has not been filed yet with the U.S. Securities and Exchange Commission, but will have to be in the coming weeks, per regulations.
The funding round is for a minority share, sources familiar with the deal and SoloMid's business strategy said, lining up with previous statements that current SoloMid principal Andy "Reginald" Dinh mentioned in interviews. Reginald, his brother Dan Dinh and other existing owners will keep control over both Team SoloMid and the websites. SoloMid did not give a response to a request for comment.
The deal was started by former Bessemer entrepreneur in residence John Robinson, according to sources. Bessemer committed to fund SoloMid on Friday. Robinson has since left his position with Bessemer and accepted an operational role at 100 Thieves, another League of Legends Championship Series franchise, sources said.
Bessemer has a history of investing in large technology and gaming companies. It was among one of the early investors in Twitch in 2012, but later sold its equity as a part of Twitch's near $1 billion acquisition by Amazon in 2014. It has also invested in Periscope, Skype and other technology companies in their early stages.
Team SoloMid is the final North American League of Legends Championship Series team to receive a significant investment, be acquired or launch with a sports background. The team is the league's most successful team in history, having won five titles since the League Championship Series first launched in Jan. 2013.
The League Championship Series chose its franchise partners in October, retaining six existing teams, including Team SoloMid. New to the league are three basketball-backed franchises and one existing esports team. The NBA franchise-affiliated teams include the Golden State Warriors' Golden Guardians, Houston Rockets-owned Clutch Gaming and 100 Thieves, a sister company of the Cleveland Cavaliers. The league also welcomed OpTic Gaming as its fourth new member.
The permanent slot in the league increased SoloMid and its peers evaluations significantly due to the removal of relegation risk and introduction of revenue sharing. Money that will be given to teams include the reported $300 million BAMTech deal with Riot Games for broadcast rights, which lasts through 2023.
Disney, the parent company of ESPN, is a majority owner of BAMTech.
Bessemer did not comment by the time of publication.