X7 Esports founder and CEO Josh Kingett has announced that he will be winding down the company in the coming weeks.
In a statement posted on X7’s website, Kingett explained why he “no longer sees a viable route forward” for the company, which in June 2021, six months after launching, notably secured sponsorship from the Isle of Man Government.
One of the reasons, he explained, was the current shaky economic climate, which “derailed” two seed investment raise attempts, in January and April of this year.
“Investors whom I can say we were very close to finalizing a deal with, instead chose to wait until the dust had settled amidst the new economic crisis,” he explained. “Given the circumstances, this was perfectly reasonable on their part despite the frustration with capital now unforthcoming.”
The other major reason is tied to NLC’s decision to scale down operations and become a non-accredited ERL. Sponsors are reportedly hesitant to support the league, where there has been a significant reduction in prize money and financial subsidies for teams, from €200,000 in 2022 to just €45,000.
The changes to NLC’s status “devalue the assets” X7 hold, according to Kingett, who adds that the organization’s business model, which was based on importing talent from East Asia and giving them a platform to play in Europe, is no longer viable.
“As a result, our remaining investment conversations have run dry and our runway cannot extend further,” he said. “Those who had previously made us an offer to consider, have justifiably decided not to proceed to sign a deal.
“Our players and staff who have been, or were, with X7 throughout this rollercoaster journey will know how appreciative I am of their unwavering support, cooperation and understanding. All remaining funds which the company holds will be proportionally distributed between its non-shareholding creditors in the coming weeks, and for all our current staff we will assist however we can in a transition to their next endeavours, be that provision of recommendations, company work portfolio, or other means.”
A history of success
X7 Esports obtained a spot in NLC’s first division following their acquisition of Absolved, another esports organization, in November 2021.
The Isle of Man-based organization made a number of high-profile moves in the offseason, including signing former world champion Kim ‘Haru’ Min-seung, and won the NLC Spring Split.
Haru was then transferred to Team Vitality in a move that validated Kingett’s vision for the organization.
The Summer Split team, which featured veteran support Raymond ‘KaSing’ Tsang, former DAMWON Gaming top laner Kim ‘Chasy’ Dong-hyeon, and ex-Vitality bot laner Amadeu ‘Attila’ Carvalho, finished in second place.
Following the conclusion of the European Masters Summer, where X7 placed 5th-8th, Chasy was transferred to MAD Lions.
“If you have ever tweeted about X7, supported our posts, cheered us on in Twitch chat, or participated in the X7 community in any way, please know that you are the reason we fought for so long,” Kingett said.
“You are the reason that made this journey worth it. Thank you.”
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