Fandom Sports Takes Important Step Towards Becoming A Major Esports Betting Player

We have recently started coverage on Fandom Sports Media (CA:FDM – $0.41 & US:FDMSF – $0.30 & GER:TQ43 – €0.28). We are very excited about this new investment opportunity in the Esports space. The Company is giving us good reason for our excitement as it came one step closer to being a major player in the growing Esports betting industry this past week.

It commenced the wagering license application process in the small Caribbean island of Curaçao. The Company created a subsidiary in the island nation called Fandom Esports Curaçao N.V. This subsidiary will be applying for the Esports gaming license to enable Esports wagering and 18+ iGaming on Fandom’s platform. This will include the ability to accept fantasy, pools, fixed odds and exchange style wagering on Esports events in a licensed, regulated and secure manner for the global Esports audience.

This license will enable Fandom to accept wagers in 149 jurisdictions, including places like Japan, Germany and South Africa. If everything goes to plan, this license will be granted in late August or early September. Fandom is assessing other iGaming license jurisdictions to have a truly global reach for its iGaming offerings, but we believe the Curaçao license is already a very good start with plenty of growth opportunities in the available jurisdictions.

Fandom anticipates to receive its gaming license within 45-60 days, which will enable the Company to accept wagers from residents of over 149 jurisdictions.

Beta Testing Is Ongoing For The All Ages Esports Application

Fandom is not sitting on its hands while waiting for the gaming license to be granted. In the meantime, it continues to develop its app for its rewards-based Fancoins platform. This platform does not require users to put in their own money. Instead, they are provided with their own cryptography secured wallets with Fancoin balances in order to wager with other members. Therefore, this platform will not be required to be licensed and will be available for all ages.

The platform is currently in beta testing with the Company’s strategic advisors. Fandom has recently created its Advisory Board, comprising of gaming industry veterans Mr. Guy Ben-Dov, Mr. Yuanhua Fei, Mr. Neil Duffy and Mr. John Armstrong. These men come from different parts of the world and have different backgrounds, but all bring a tremendous amount of expertise in the Esports world to Fandom. If they are taking part in beta testing, investors can be assured that they will be doing a thorough and accurate job. It is very important that Fandom has a fully functional app that will have engaging features that users will want. The Company was right to bring these advisors on board and to engage them in the beta testing process to analyze the technology, features and user interface.

Fandom Is A Ground Floor Opportunity To Take Advantage Of The Exploding Esports Industry

Fandom is in the very early stages of its Esports business plan. But that plan is quite extensive and unique with multiple near term positive catalysts. While it is trading at $0.41 on the Canadian Securities Exchange in Canada, it has less than a CAD$13 million market cap. Purchasers of the stock can look forward to quickly growing their investment upon successful execution of the business plan.

The risk factor is rather high like it would be for any startup, but that is baked into the low valuation with high upside potential. The main challenge for any startup company would be surrounding itself with the right people. We think that Fandom has done so with its Advisory Board mentioned above and leadership team. Chairman Philip Chen has an impressive Rolodex in China that will serve as the initial launch point for user growth. CEO David Vinokurov has the ability to communicate this investment opportunity in a concise yet complete fashion as evidenced by our recent podcast with him.

Since Fandom is working on multiple fronts, this naturally offsets some of that operating risk. For instance, if Fandom were to experience some bumps in the road in getting the gaming platform licensed, it can still move ahead with the non-licensed platform. The stock price would not take a hit like an all-or-nothing kind of business plan would. In fact, we think that at a $13 million market cap, the non-licensed tokenized platform would be more than enough to support that valuation. The successful deployment of the licensed gaming platform would be the blue sky potential. That’s why we have a target price of more than 3x upside to current market prices. Smallcaps Recommendation: BUY. Advice: BuyPrice Target: $1.26Latest Company Report (pdf)
For important disclosures, please read our disclaimer.

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