Due to the outbreak of the coronavirus pandemic, the United States Treasury and Small Business Administration granted loans to more than 660,000 small businesses. Even though the exact amount of loan was not stated, they are eligible to a loan that is 2.5 times the amount of their average monthly payroll.
The Paycheck Protection Program has approved loan assistance ranging from $150,000 to $2 million for eight esport parent companies of 13 Overwatch League and Call of Duty League.
The loans are supposed to be paid within two to five years depending on the dates they borrowed them but will be forgiven if the company maintains 75% of their existing salary cost before the pandemic and at least 60% of the loan is used for employee payroll. Each loan is also expected to carry a 1% interest.
eUnited and P1 sports are renowned Esport organizations that also borrowed from the program even though they do not participate in Overwatch League or Duty League. They acquired the same amount from $150,000 to $350,000. It should also be noted that no League of Legend franchises borrowed from the PPP.
eUnited Chief Executive Officer Adam Stein spoke to ESPN, “we received PPP money within the range listed by SBA, and that the monies were used consistent with the intent of the program: to keep people working while dealing with the impact of COVID.” Indeed the program is part of the CARES Act, a coronavirus relief bill passed by the US Congress that includes assistance for businesses and individuals in these tough times.
Among the Esport team ownership groups that are sharing in the benefits of the program are;
- Envy Gaming – The parent of Team Envy, Dallas Fuel, and Empire. They borrowed from $1 million to $2 million.
- FaZe Clan – The part owners of Atlanta FaZe, took $1 million to $2 million loans.
- ESXL – The owners of Andbox, New York Excelsior, and New York Subliners took off $1 million
- Hard Carry Gaming– The organization behind NRG Esports, San Francisco Shock and Chicago Hunstmen took a loan between $350,000 to $1 million
- DM- Esports and cOntact Gaming– Parents of Paris Eternal and Paris Legion loaned two $150,000 to $350,000
- REKTGlobal– Founders of Rogue and London Royal Ravens took $150,000 to $350,000 loans
- Surge Esports– The American arm of Enthusiast Gaming and owners of Seattle Surge, took $150,00 to $350,000 loan.
A spokesperson for Andbox told ESPN that the company paid back the loan they had received in full. An Envy Gaming spokesperson confirmed that they did take a loan from the Paycheck Protection Program. “The amount received was among the lower end of the range listed. The loss of live events due to COVID-19 was a major change to Envy’s 2020 business strategy, going from an expected seven events hosted in North Texas to only a single event. The money received through PPP was used for its intended purposes, primarily to help pay for fixed costs of operation such as salaries of those in the organization.”
FaZe Clan, Hard Carry Gaming, DMEsports, contact Gaming, Surge Esports, and REKTGlobal are among the Esports companies that did not respond to the request to comment whether they had paid back or it’s still pending.
The Overwatch League had planned to hold 52 homestand events across the 20 cities that were represented in the league, some of these events were held in some cities before the pandemic, but the league had to cancel events of the remaining season and moved all games online because of the coronavirus scare.
Other sporting organizations had also received loans from the program
Apart from Esports, other sporting organizations such as National Association of Sports Car Racing and Indycar, the National Football League, Major League Baseball, National Basketball Association, boxing promotion run by Floyd Mayweather and Bob Arum and Oscar De la Hoya received loans from the program for the same just cause.
What the United States treasury administration is doing here us such fantastic work. Helping people with substantial loans to boost their business while we struggle through a pandemic is commendable. This shows that the United States governing bodies are doing all they can to bring back “the reward for a functional society,” as said by Washington Nationals pitcher Sean Doolittle.
Adding Electronic sports to this initiative means they are getting more recognition as they should, which is by far what the sports are all about for now.