Esports Entertainment ‘putting cash back in the bank’ as Vie.gg closes sites

Vie.gg, an esports-focused betting site operated by international firm Esports Entertainment Group (EEG), has closed down three jurisdictions.

The company informed customers in the UK, New Jersey and Spain that the Vie.gg sportsbook webpages in these locations would close down on 1 November.

“Dear Patron. We have made the difficult decision to close Vie.gg. The site will remain open until November 1, 2022. Until then, you will be able to log in to close your account,” read the email to customers.

“Any accounts remaining open at that date will automatically be closed and any remaining balances of $1 opr more will be returned by check sent to the address registered on the applicable account.”

A US-based enterprise, EEG has maintained an international focus for the past two years, having operated Vie.gg in the UK and Spain whilst last year acquiring Malta-based betting brand BetHard for EUR €16m.

However, the company has encountered some difficulties this year, detailing ‘near term challenges’ in its Q3 2022 financial results published in May, despite recording a two-fold increase in corporate revenues of $15.7m (Q3 2021: $5.3m).

As a result of these fiscal hurdles, the firm announced its intention to evaluate its operating portfolio, with a view to improve its overall liquidity position.

At the time, Grant Johnson, EEG CEO, explained to the group’s Nasdaq investors that the ggCircuit and EGL brands were ‘two assets that we have not effectively been able to monetize due to liquidity restraints’, while the Helix business did not have a path to ‘attractive profitability’.

Five months down the line, it appears that EEG’s decision to shut down Vie.gg in three major jurisdictions falls in line with its goal of reducing costs.

In an interview with NJGamblingSites earlier this week, Johnson explained that ‘seven figures a year’ costs for operating an esportsbook in New Jersey were deemed too high for it to be worth the firm maintaining a presence in the state, citing a similar situation in the British and Spanish markets.

“Had the market not turned so radically, we had anticipated raising capital and then adding a sportsbook. But by the time we were approved, clearly, the world had changed,” he continued.

“We are restructuring to last through to more stable markets. At this time, NJ, Spain, and the UK are all jurisdictions that we don’t have the required capital to stay active in. So we are reducing our burn and putting some cash back in the bank.

“These are stressful times and companies need to make difficult decisions. This falls into the difficult but necessary category.”