Founded in 2013 by Jack and Paullie Etienne, the esports company Cloud9 has always been a bit of a mom-and-pop operation. Once during those early days, Jack’s father, a retired lawyer, paid a visit to his son’s house, discovering a floor covered in shirts, sweaters and hoodies. The husband-and-wife team were spending their time stuffing envelopes by hand and shipping out merchandise to fans. His father wanted to pitch in and started helping ship that merchandise, and even eventually served as the company’s first legal counsel.
“At our heart, we really were a family business,” says Jack, who is also Cloud9’s CEO.
That family business just scored another big win this year, as Cloud9 announced Monday it received $50 million in Series B funding. The round was led by Valor Equity Partners, and its founder and managing partner, Antonio Gracias, joins Cloud9’s board. Other investors include TrueBridge Capital Partners, Reimagined Ventures and Glassdoor founder Robert Hohman.
The influx of equity enables the company to take some significant steps forward in 2019. According to Nielsen, Cloud9 has the broadest reach in the United States and the United Kingdom, which has helped make merchandising one of its strongest revenue segments. With an operational headcount of 35, Etienne is hoping to build out a team to make it more robust and to increase the team’s retail footprint.
And like its North American peers Team Liquid and TSM, Cloud9 has begun plans for a 20,000-to-30,000 square foot training facility and home base for its operations in Los Angeles. Its disparate teams will all practice at the facility, while also consolidating its staff of managers, a sports psychologist, a physical therapist and chef. While it’ll no doubt be finished by the end of 2019, Etienne is hoping to be up and running by the start of next year’s competitions.
These facilities aren’t just for competitive performance, either. A major focus for the company moving forward is facilitating youth esports. Many players train solo and are inexperienced in a team setting. As detailed by Cloud9’s president, Dan Fiden, the company is hoping these spaces become, “the esports analogue to a Little League diamond.”
“Your 14-year-old daughter loves Overwatch and wants nothing more than to get coached and participate in a league—this could be the place that you take her for practice on Wednesday afternoon every week,” Fiden says.
It’s a forward-looking plan that’s emblematic of its CEO, whose company made this year's list of Forbes’ Next Billion-Dollar Startups. This time last year, Cloud9 closed a Series A funding round for $20 million that was co-led by Founders Fund, who seek out companies with strong leadership already in place.
“Jack is exactly the type of founder we’re looking for,” says Brian Singerman, the partner at Founders Fund that led its investment into Cloud9. “If you know Jack, he quite literally lives and breathes C9.”
Cloud9’s 2018 has been full of wins, starting in January when its Counter-Strike: Global Offensive team became the first North American squad to take top honors at a Major tournament. Its dramatic championship win at ELEAGUE Major: Boston 2018 had a concurrent viewership peak of 1.1 million, a record for a single channel on Twitch.
In July, the Overwatch League’s inaugural season was capped off with a sold-out Grand Final at Brooklyn’s Barclays Center, where Cloud9’s affiliate, London Spitfire, became the league’s first ever champion after taking down the Comcast-backed Philadelphia Fusion. Due to the road map toward local matches in the league, Cloud9 is also planning a London facility in addition to its headquarters in Los Angeles.
As one of the new kids on the block in Rainbow Six Siege, Cloud9 entered September’s DreamHack Montreal 2018 as a significant underdog, yet carved a dramatic road toward victory against the team, Rogue.
And in line with its focus on developing younger players, its League of Legends team has brought three rookies to its sixth-consecutive appearance at the World Championships going on right now, the longest streak of any team in the esport. With so much going on this year, its CEO is eager to get started with all of its new initiatives planned for next year.
“I am so excited for the future of Cloud9."
