TAMPA — As a mutual fund wonder-boy, hedge fund manager and real estate investor, Jeff Vinik has long displayed a sense for knowing when to put money into the next big thing, and his latest bet on e-sports may be no different.
Vink recently bought nearly 887,000 shares in Turtle Beach, a San Diego company with a big share of the market for video game headsets, according to a new filing with the U.S. Securities and Exchange Commission.
With a company slogan promising, "hear everything, defeat everyone," Turtle Beach this spring reported first-quarter net revenue that was more than triple what it saw in the same three months of 2017. The growth was fueled largely by success of hit video games Fortnite and PlayerUnknown's Battlegrounds to attract new players, younger players and women.
At Turtle Beach's trading price on Monday of $20.58 per share, Vinik's 6.4 percent stake in the company amounts to about an $18 million holding, though the stock price was more than $1 per share lower in mid-September.
Though Vinik is best-known locally for owning the Tampa Bay Lightning and developing (with Cascade Investment, a Bill Gates company) the 50-acre Water Street Tampa project, Turtle Beach is not his first foray into e-sports.
Last year, he invested in and became one of four co-chairmen at the gaming and e-sports company aXiomatic, based in Los Angeles. The company is the majority owner of Team Liquid, with a roster of professional gamers who have broken records and won championships in a variety of online games.
"I've watched the growth of the e-sports industry for a number of years, and the opportunity to become involved with the impressive group already assembled at aXiomatic is the ideal way for me to make an impact," Vinik said in an announcement of his investment. One of Team Liquid's partners is the Amazon-owned website Twitch, whose livestreams are watched, at any given moment, by an estimated average of nearly a million viewers.
In an interview with Barron's last year, Vinik mentioned his investment in aXiomatic and, separately and more generally, talked about sports media rights as an opportunity worth tracking.
"We're coming into an interesting five to 10 years," Vinik said. "Sports continues to be the only content that people really have to watch live. That gives it the ability to be commercially sponsored in ways no other media can.
"Obviously, people are watching less traditional TV and watching through other media like laptops or smartphones or tablets, and more is being watched digitally," he added. "The delivery mechanism is changing. It's not only major networks bidding on sports rights. Now Amazon is a distributor of NFL Thursday Night Football in the country. There's potentially a great new source of demand for sports media. It's tough to handicap: I'm bullish, though I don't want to be pinned down to a specific number" on the upside investment potential.
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