Esports organisations typically treat player salaries and transfer fees as well-guarded secrets in Brazil. But Brazilian organisation The Union GG has disclosed to Esports Insider the average amounts invested in hosting rosters, influencers, and employees in the local scene.
The Union GG CEO, Luis ‘LuiShow’ Felipe, spoke frankly about the organisation’s investments in its teams, salaries, sponsorship, and monetisation strategies.
Felipe told Esports Insider that the total investment planned by the organisation for 2022 is R$1.5m (~£240,000), but some changes in its plans might increase that to R$2m (~£320,000).
Founded in 2021, The Union is 50% owned by the poker team Midas, and was founded and funded by a group of professional poker players including Caio Almeida and Paulo Joanello. With a little over 5,000 followers on Twitter, The Union can be considered a modest-sized team in Brazil. While it is enjoying growth, it is still far from the size of Brazilian powerhouses such as paiN Gaming and FURIA.
Initially, the organisation gained relevance through Grand Theft Auto V Role-Playing (GTA RP) content. Now, The Union holds rosters in Counter-Strike: Global Offensive and VALORANT.
Part of the organisation’s expenses is covered by an R$800,000 (~£128,500) per year sponsorship from gambling website Betfast. Those costs include salaries for players which, according to Felipe, average R$5,000 (~£805) per month for both CS:GO and VALORANT — though some undisclosed players earn more. R$5,000 is considered a basic salary for a person living in a city such as São Paulo. However, players can also earn other sources of income through individual commercial deals.
It is also important to note that, even though it fields competitive teams (sufficient to aim for a spot in the IEM Rio Major 2022), The Union does not count on superstars on its rosters, instead signing players that it believes will have a good fit in-game.
Felipe also revealed how much the organisation invested in bringing in some of those players to its organisation. The Union paid R$25,000 (£4,024) to Leviatan Esports for signing Fillipe ‘pancc’ Martins to its VALORANT team, and R$15,000 (~£2,930) to SWS Gaming for the CS:GO player Daniel ‘DANVIET’ Marques.
Those amounts are considered low in comparison with other figures that recently came to light in the Brazilian press. The HLTV-owned news site Dust2 reported that Fluxo paid around R$1.8m (~£290,000) to YNG Sharks for Lucas ‘Lucaozy’ Neves.
The Union, however, prefers to count on players that want to come to the organisation and also come from teams interested in a transfer. “It depends on the player, on his experience, his credibility on the market, and if he will bring a big marketing impact,” Felipe said.
Even though the organisation invests in competitive gaming to grow engagement amongst passionate fans, according to Felipe another big pillar of income for The Union is through its influencers, who earn between R$3,000 (~£483) and R$4,000 (~£644) per month.
“Today the revenue of an esports organisation comes 0% from the performance of its teams,” he said. “This is a golden tip: sign influencers and sell quotas for brands to be promoted by the channels of these influencers. This is the way of monetising an organisation with modest numbers. You work as an agency of such influencers and raise earnings from it.”
Felipe says that the biggest expenses of the organisation are staff and structural costs. Currently, The Union employees earn an average of R$4,000 (~£644) per month for freelance jobs.
Felipe said he decided to speak openly about costs, earnings and investments in the scene because he wanted to inform people in the scene how an esports organisation works. “It’s to show the market that it is possible to do a good job without inflating figures. Nowadays, we’ve been seeing very high fees, with really high values, but the reality sometimes is not [like that].”
Future plans for The Union include opening a facility in São Paulo in 2023 – it currently has an office in Curitiba, in the Southern part of Brazil – and purchasing a spot in Riot Games’ VALORANT franchised league. The organisation’s VALORANT team was formed after the due date for applying to the league. An event focusing on the GTA RP community is also planned for sometime in October or November.