Trading in shares of the Skillz mobile esports platform has started today on the New York Stock Exchange. The company went public bypassing the IPO procedure, choosing an alternative in the form of a merger with SPAC.Skillz is a platform that allows you to compete with other players and win real money in mobile games.
Users pay for participation in the tournament, and the winner takes all the bets of rivals.
“We operate at the intersection of mobile gaming and esports — perhaps the two most attractive areas in terms of growth in the next decade,” Andrew Paradise, CEO and founder of Skillz, has repeatedly stated.
In the case of Skillz, its method of entering the stock exchange is interesting. Most companies go public through an IPO, i.e. through the initial issue of new shares. However, some choose alternative ways. One of them is the merger with the “special Purpose Acquisition Company” (SPAC). This process is considered simpler and usually takes less time compared to an IPO.
And yesterday Skillz completed a similar merger with SPAC Flying Eagle Acquisition.
The president of Flying Eagle Acquisition is Harry Sloan, who previously served as a member of the board of Bethesda. This year, his company has already raised $690 million and helped the American fantasy competition operator DraftKings enter the stock exchange.
Despite the fact that Skillz has not made a profit for three years, as part of the transaction, its valuation was $3.5 billion. More than 3 million tournaments are held on the platform every day, and in total for 2020, users must pay $ 1.6 billion to participate in them.
As part of the takeover and entry into the stock market, Skillz received private financing in the amount of $158.5 million. The investors were Wellington Management Company, Fidelity Management & Research Company, Franklin Templeton and Neuberger Berman.
As of Wednesday, the consolidated balance of the esports platform had $250 million in cash and no debts.