We're opening up the esports industry as a new revenue stream for mobile game publishers.
- $500k investment in the last 3 years*.
- Global traction and validation by gamers over past 12 months.
- $1m in transaction volume and $100k+ in revenue*
- Applying for Future Fund, conditional - see Key Info
Learn more about convertible loan campaigns.
We are an esports service provider for mobile gamers and a new revenue stream for mobile game publishers.
MOBILE ESPORTS AS A SERVICE
We provide an esports experience for mobile gamers where they compete with one another to win real money prizes. Players are required to deposit before playing on Gamerpro, and winners can quickly and easily make withdrawals. Gamerpro only works with mobile games which are both skill-based and have a PvP gameplay mode.
ESPORTS AS A NEW REVENUE STREAM
Because of the challenging economics of the free-to-play model, most developers struggle to monetise their games effectively. That’s why, at Gamerpro, we've developed a new revenue share model for mobile game publishers, focused on integrating our esports service.
The more publishers we partner with, the more revenue we will generate. In summary, our vision is to create a sizable new, consistent revenue stream for the mobile games industry, helping it to become more diversified.
*Figure is based on information in unaudited management accounts.
Substantial accomplishments to date
After several iterations, we launched our service to ensure global traction by running ads on social media in 2019. The +500k of mobile gamers who registered were evidence of our belief that there is significant demand out there for the Gamerpro service.
In the last year, we reached the following milestones without any partnered publishers, nor direct connections within mobile games:
+$1M transaction volume*.
+500k app installs.
+20K paying customers.
+160 countries, TOP 3: USA, Mexico, and Argentina.
*Based on unaudited management accounts.
With the lack of direct connections in this period, we pinpointed three key challenges in the Gamerpro user journey. These will need to be eliminated in order to scale up our business model:
1. Identifying the users’ profile in the game.
2. Matching opponents in the game.
3. Obtaining an unbiased, accurate and certified match result.
We will do this by partnering with mobile game publishers. Such a partnership has two main components; our own API, and a revenue share model.
We launched an awareness drive via outreach to a number of mobile game publishers globally in late June 2020. The interest was considerable, and we signed LOIs with the selected early adopters after four weeks. From our own calculations, our potential partners have a combined 500M+ app installs on their mobile games in the Google Play Store alone.
We are now furthering the partnering processes by organising a series of webinars and offering pre-registration for our API.
We help to solve a key problem suffered by multiple mobile game publishers; monetization. We do this by providing a new revenue stream in the form of easily accessible, competitive PvP gaming. In return, publishers connect their games with Gamerpro and permit us to remove the main three frictions of our user journey.
We charge a 10% service fee based on the total prize, and charged only to the winner, and only after a game is completed. As such, the more completed games delivered the better, meaning automation is particularly important. For this reason, we will share a portion of the revenue generated with our partnered publishers based on their users and games.
It is planned that 60% of the generated revenue will be shared with them based on their users and games, for as long as they are using our service.
Use of proceeds
Gamerpro will use the funds raised to accelerate the API development for its consumers and business partners.
TECH DEVELOPMENT - Accelerating API development for Gamerpro users and business partners.
ONBOARDING TOP TALENT - Expanding the team with highly skilled experts from the video games and gaming industries.
PRODUCT DEVELOPMENT - Optimising the skill-based matchmaking algorithm of Gamerpro with more data secured by partnered publishers.
Please note that any discounts, rewards and/or offers listed by a company in its campaign are subject to the terms and conditions applied by that company and listed above. It is the company’s responsibility to honour such discounts, rewards and/or offers and Seedrs does not take any responsibility for them.
Gamerpro has the following debts outstanding:
1) A PayPal working capital loan of £26,676.15 (as of 31/12/2020). This loan accrues no interest, but has a fixed fee of £7,400. This loan will be repaid from the volume of Gamerpro service fee through PayPal.
2) €35k owed to creditors for subcontracting fees from the last financial year. This debt accrues no interest and is intended to be repaid from revenues.
Outstanding Convertible Loans
Gamerpro has two convertible loans totalling $150,000 outstanding ($100k and $50k), with the following key terms:
- Interest rate: 8% p/a (non-compounding), to be repaid or converted with the principal loan.
- Discount: 30%.
- Maturity Date: 30 June 2022 for $100,000, and 30 November 2022 for $50,000.
- Conversion trigger(s): Parties agree that all other terms shall be the same as the terms of the convertible loan agreement to be signed with Seedrs and/or Future Fund.
- Share class: Most senior shares in the company or issued in any triggering funding round.
- Repayment: the loan, together with interest, is to be repaid (i) on the Maturity Date at the election of the company, (ii) an event of default (which includes insolvency) or (iii) a breach of the loan agreement at the election of the investor majority. The company may also redeem all or part of the loan (together with interest) at any time prior to the Maturity Date.
Please note, Gamerpro currently has two share classes outstanding; Ordinary shares and Preference Shares.
Preference shares have the following additional rights as compared to Ordinary shares:
Liquidation Preference - if the Company is liquidated or wound up for any reason, Preference share holders shall be entitled to receive any distributions first, up to the amount they invested, plus a yield calculated using a 20% p.a. internal rate of return (‘IRR’).
Yield Preference - if the Company's shares are sold to a third party and dividend payment takes place, Preference share holders shall be entitled to a dividend in respect of the amount invested before any dividends are paid to Ordinary shareholders, up to a yield calculated using a 20% p.a. IRR.
As this is a Future Fund raise, Seedrs investors will convert in to the highest class of shares on conversion of the Future Fund CLN. This is currently the Preference shares.
New Convertible Loan Note (This Investment)
Seedrs is supporting companies who are intending to apply to the Government backed Future Fund. You can read more about the Future Fund here: https://www.seedrs.com/learn/blog/the-future-fu...
In order for a company to be eligible to seek matched funding from the Future Fund, this investment round must be on the convertible loan terms that have been prescribed by the Future Fund for this purpose. These terms differ to our normal ‘advanced subscription agreements’.
Given this product differs from most campaigns on Seedrs, we urge all investors, including regular Seedrs investors, to read the information below and ensure you understand the terms in full before making your investment.
1. Key terms
You will see a term sheet attached to this Campaign in the Documents section which sets out the key terms of the convertible loan and you can see the full document prescribed by the Future Fund here: https://www.british-business-bank.co.uk/ourpart...
A summary of the key terms is set out below, but should be read in conjunction with the term sheet:
Interest: 8% per annum, non-compounding. On conversion events, the company can choose to repay the interest or convert it to equity (generally without the discount). See the Term Sheet for more details.
Redemption Premium: An amount equal to 100% of the principal loan amount.
Qualifying Equity Financing. The convertible loan will automatically convert on an equity financing raising at least the total loan amount, at the lowest share price of equity financing less the Discount.
Maturity Date: 36 months from signing convertible loan agreement.
The default position is on the maturity date is that the loan will convert to equity unless the investor majority elect to redeem.
If redeemed, the company will repay the principal together with the Redemption Premium.
If converted, the conversion price will be at the most recent funding round share price less the Discount, provided that funding round happened after 20 April 2020 and was at least a quarter of the size of the convertible loan investment. If no such funding round has occurred, conversion will be at the share price of the last funding round prior to 20 April 2020 (no Discount).
Other events of default or conversion: There are various other scenarios in which the convertible loan may convert or be repaid and investors should reference the term sheet:
Non Qualifying Funding Round: The convertible loan can convert on an equity financing round which does not meet the size criteria of a ‘Qualifying Equity Financing”, at the election of the majority of investors under the loan. Please see the term sheet for how this conversion is priced.
Exit: The convertible loan will automatically convert or be redeemed on an Exit, whichever would give investors the higher cash return. Please see the term sheet for how conversion is priced and payments on redemption in this scenario.
Events of Default: The convertible loan is to be repaid on the events of default, such as liquidation or winding up. See the term sheet for more details.
2. Government matched funding
The company intends to apply to the Future Fund for matched funding on the total eligible amount invested in this funding round. Subject to eligibility criteria and the Future Fund's approval, the Future Fund will “match” the funding raised via Seedrs or other eligible sources, subject to a minimum investment of £125,000 and a maximum investment of £5m.
This campaign is conditional upon receiving matched funding from the Future Fund. Seedrs will not complete the investment and transfer the funds raised until we have confirmation that the Future Fund matched funding application has been approved and that the Future Fund is ready to make the investment. If the application is denied, the campaign will be cancelled and funds will be returned to investors.
Because this campaign is conditional upon the matched funding, you will see that we have reflected the Future Fund investment as part of the round. This is to give investors an indication of the potential total size of the funding round (and potential dilution on conversion).
Seedrs does not charge any fees in relation to the Future Fund matched funding, application process or for acting as lead investor with respect to applications.
3. Conversion to equity
The convertible loan agreement prescribed by the Future Fund is equity focused and favours conversion of the loan to equity as the default position.
Redemption is only available in certain scenarios and is often subject to the vote of majority of the investors. Where a vote of investors is required, Seedrs will vote on behalf of any investors it represents as nominee.
There is a possibility that the convertible loan will convert in some scenarios without the consent of Seedrs (if we do not make up a majority of investors). It is also Seedrs’ position that this is primarily an instrument for investing in the equity of the fundraising business and our default position would be to vote in favour of converting the loans to shares in the company, unless there is a clear or compelling reason not to.
As always, investors should be aware of and accept the risks involved in investing in early stage and growth focused businesses: https://www.seedrs.com/pages/risk-warnings
In addition to the usual risk warnings included above, investors should be aware of and accept the following with respect to convertible loans:
The convertible loan agreement is intended as bridge funding to a future funding round, but there is no guarantee that a company will be able to secure further funding.
The Future Fund is to be allocated on a ‘first come, first served basis’ and there is no guarantee that a company will be successful in its application to receive the Future Fund matched funding.
There is a risk that the Company may not have sufficient funds to repay the loan on the maturity date, pay interest when it becomes due or pay the redemption premium included in the terms.
Convertible loans are unsecured obligations and in the event of a winding up or liquidation event will rank behind secured creditors of the Company.
5. Secondary market
Investors will not be able to sell their interest in the convertible loans on the Seedrs Secondary Market unless and until they have converted to shares in the company (and then only subject to eligibility and the terms and conditions of the Seedrs Secondary Market).
6. EIS Relief - past, current and future
As noted above, the convertible loan instrument is not compatible with EIS requirements, so no EIS applications will be made with respect to investments in the convertible loan.
The government has confirmed that investing in the convertible loan will not impact EIS relief previously claimed on investments in the fundraising company:
“The government has confirmed that such previous investments will not be affected where the convertible loan converts into shares. Where the convertible loan note redeems, we have been alerted that the government intends to make changes to the rules to clarify that this is compatible with such previous investments.”
However, investing in a convertible loan could impact your ability to claim EIS relief on future investments into the same company. The government has not clarified the position on this and has said it is a matter for HM Treasury and HMRC.
Seedrs is unable to provide tax advice. Tax treatment depends on individual circumstances and is subject to change.
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