How Sundance DiGiovanni Built The Biggest Competitive Gaming League In America

major league gamingMLG CEO Sundance DiGiovanni welcomes the crowd in Columbus, Ohio

Photo: Major League Gaming

Major League Gaming co-founder and CEO Sundance DiGiovanni stepped onto the stage under the glaring lights as thousands of raucous fans cheered.The throng wasn’t here to see him. After all, he was only up there to hype them up and kick-off the three-day competition. He stood there grasping the microphone in his hands and swelled with pride.

They were all here to see what he had created.

“To see 5,000 people screaming during the match … it’s just great right?” says DiGiovanni. “I get a sense of amazement every time. It is becoming what we all thought it could, but there’s always more.”

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It was the Major League Gaming Pro Circuit Winter Championships in the Greater Columbus Convention centre in Columbus, Ohio. More than 2,000 of the world’s premier video game players were there to battle it out for a chunk of the $200,000 prize pool. The matches were broadcast to hundreds of thousands of viewers through six live online streams. All this to watch people play video games.

A decade prior, DiGiovanni was sketching designs on cocktail napkins for stages like the one he stood on in Columbus. Now, Major League Gaming is the world’s largest professional video game league and it’s at the forefront of America’s eSports movement — a movement which is growing by the day. 

“eSports will someday be the biggest sport in the world,” proclaimed Daryl Morey, general manager of the NBA’s Houston Rockets, at MIT’s annual Sloan Sports Conference this year. A decade-and-a-half ago, it would have been hard to believe these words were coming out of the mouth of any executive in a major sports league. 

The few professional gamers out there fought to grind out livings on the few — and small — prize purses that were available. In the late ’90s, the Cyberathelete Professional League (CPL) found success in the niche, offering hefty payouts to the best-of-the-best. eSports began to enter the consciousness of more and more people, and it became evident that this could be something big. 

MLG’s latest expansion came earlier this month when it announced a partnership with CBS Interactive. No, it’s not coming to network television, but CBS owns Gamespot, one of the largest gaming websites out there. It will now be the exclusive online broadcaster of MLG’s Pro Circuit competitions and, importantly, its advertising representation. MLG’s annual revenue is now in the $20 million range and the company employs roughly 50 people.

sundance digiovanni major league gaming

Major League Gaming

It’s time to kill the gamer stereotype

DiGiovanni looks nothing like the stereotypical gamer the public envisions. He’s not that overweight, acne-ridden boy who pounds Red Bull energy drinks like they’re the only thing keeping his heart beating. That stereotype should be long-dead, but it still lingers.Though he often wears a hoodie, today DiGiovanni’s black button-down shirt brightens the grey in his scruffy, salt-and-pepper beard, mustache and soul patch. His short, buzzed-down hair comes together in a widow’s peak. The look, and his voice, force you to listen to him.

It’s not the contrived charisma and false bravado you hear from some Internet gamers, firing off jokes and taunts over a microphone after a kill playing Halo: Reach on Xbox Live. Instead, it’s the calm-yet-decisive aura of an executive who never shies away from responsibility. DiGiovanni hasn’t forgotten his days as creative director, tasked with handling big brands like Sony and Pfizer. MLG is serious business, and DiGiovanni is a professional, through-and-through.

But though he doesn’t play the part on the surface, that doesn’t mean he’s not a gamer. Video games drive DiGiovanni’s life, not just the multimillion dollar business that he built around them. When he was a kid he was ultra-competitive and played various sports and chess. At one point, he was given an Atari 2600, and he found a new way to channel that spirit. He’d play Combat against his friends on the console, or he would head over to the arcade. But wherever he was, he would always keep the score.

“It was one of those things for me that was an anchor,” says DiGiovanni with a flourish. “I moved around quite a bit and there were two things I’d typically use as a kid in a new town to introduce myself to people: sports and video games.”

Video games came along with him as he got older. His first job in high school was managing a video arcade in a resort town, and he would hold little tournaments there with his friends. In college, he would play hockey on the SEGA Genesis with a group of friends and keep all the scores on graph paper so that they could play out an entire season with each other. Video games were always social for DiGiovanni — nothing could be more opposite than the reclusive cave-dweller stereotype that gamers still have on their shoulders.

DiGiovanni’s creative nature also serves to balance out MLG’s other co-founder and current chairman Mike Sepso. By working together, DiGiovanni can now read income statements and Sepso knows about branding, marketing, and the creative process. The two were good friends before they started the business together, and fortunately they’re still buddies today.

“He can be pretty A.D.D. When I need to focus on a conversation or something, he’ll be doing other things,” says Sepso as he looks over to his friend. DiGiovanni’s head is down, thumbs vigorously mashing the keys on his BlackBerry. “See?”

The idea for MLG was born at, of all things, an after party at the X Games — the annual extreme sports event run by Disney’s titanic sports network ESPN. Here, DiGiovanni saw the power of a star.

ESPN held the first X Games in 1995 in Rhode Island and it attracted around 200,000 spectators. Back then, extreme sports filled the smallest of niches in the overall sports world. That year, the X Games featured skateboarding, sport climbing, an eco-challenge, sky surfing and a few other events. At the party — which DiGiovanni says he “kind of snuck into” — he saw a big guy with a huge smile on his face attracting a crowd. He asked someone who the guy was, and it turned out he had just won a medal in a street luge event. It dawned on DiGiovanni that the few fans that followed the sport loved this street luger just as much as the millions that watch their favourite players play in the world’s most popular sporting events. 

“I remember walking around and thinking, these guys are stars,” says DiGiovanni. “These are athletes. This culture exists, and they love them. It doesn’t matter what the broader community thinks. People who don’t appreciate baseball don’t care, but people who are fans of the game respect what these guys accomplish.”

Now, street luge has fallen back into its niche, having never gotten the attention ESPN wanted from the American public. But the X Games has become a spectacular success, and sports like skateboarding, BMX and freestyle motocross are far bigger and more mainstream than they’ve ever been. 

Before MLG even had its first event, DiGiovanni and his crew had signed players and got them endorsement deals. The league would rely on creating stars, each with their own unique brand, to attract the same types of crowds you see at sporting events everywhere.

major league gamingLeft to right: MLG CEO Sundance DiGiovanni, chairman Mike Sepso and EVP of operations Adam Apicella

Photo: Major League Gaming

MLG’s first event was a disaster, but the crew got a lot out of it. DiGiovanni and Sepso held it at a small LAN cafe on Manhattan’s east side close to New York University. The place was called Game Time Nation, and like many internet and LAN cafes across the country, it doesn’t exist anymore. It was completely funded out of the pair’s pockets, and featured the games Halo, Madden 2002, and Gran Turismo 3. “It was crazy how bad we did the execution side,” says DiGiovanni with a chuckle. He can laugh about it now, but at the time it wasn’t nearly as funny. “It was just me and Mike making a mess.”

MLG made one of its most important hires because of that one event. “I got an email from a kid at the time named Adam Apicella,” says DiGiovanni. “Basically, he said that he could save us from ourselves.” The kid had some experience in organising events, so they brought him into New York, took him out to dinner and hired him on the spot. Apicella abandoned his plans to go to law school to take the leap of faith with DiGiovanni’s venture.

“Sundance and Mike gave me a chance to do something probably that was beyond my expertise or experience level at the time,” says Apicella. “I’d do anything for those guys. I look at them as mentors.”

Apicella is now MLG’s executive vice president of operations. He has been in charge of running every event that the league has done since his hire, from special events at the Super Bowl and NBA All-Star Game to MLG’s pro circuit events. The gig now has far more luster — and responsibility — than it did in the early days.

“We didn’t know how to do anything, and there was no manual on how to run these events,” says Apicella. “But we had the luxury of learning in front of a small audience. If we made some of those mistakes [we made] in 2004 right now, it’d be crazy.”

The toughest fight for DiGiovanni and his fledgling company came within the first year. He and his wife had their first son and he was tapped out. He struggled to find the cash to pay rent and questioned the path he chose. He ruminated over the decision to trudge on or call it quits and go back to his old life. DiGiovanni was at his breaking point, and if he cracked, the company may have shattered with him. He set himself a deadline. If the company wasn’t stable in three years, he would pack up and leave. After all, that would be best for his family.

“By having that drop-dead date, you force yourself to make good decisions,” says DiGiovanni as he leans forward, elbows propped and hands squeezed together. His dream had almost died back then.

In 2006, three years after he made that vow, MLG raised its first round of venture capital funding. It received $10 million from Ritchie Capital and the league was on its way to the big-time. DiGiovanni and his crew made it through the quagmire, but now ran into a new set of problems.

major league gaming

Major League Gaming

The crowd at MLG’s Pro Circuit Winter Championship in Columbus, Ohio

If MLG was to succeed, it would first have to be accepted by those who mattered most: the gaming community. You are what the community says you are, and if you don’t remain authentic to the community, they won’t accept you, says DiGiovanni.In MLG’s case, each game has a community attached to it, so the brand has to make sure that it’s looking out for each of their interests. “I have a relationship with them, and I have to think about them and what’s important to them and the value that we’re bringing them,” says DiGiovanni. “If you lose a community, it’s hard to get that trust back.”

Support from the gaming community is required for MLG, because its goal is to become the “de facto standard” of video game league. If you’re the league that everyone believes is the pinnacle of the sport, you will win, says DiGiovanni. That’s an impossible feat to accomplish without the trust of the gaming communities.

As for the mainstream, video games still have a negative stigma. The debate about video game addiction has raged on ever since the arcade game Space Invaders sparked political controversy back in the late 1970s. Now, with lots of money being thrown around and kids choosing competitive gaming as a real career path, it has become a never-ending struggle. Still, DiGiovanni thinks that his side will win out.

“Whenever you do something that’s not traditionally accepted or understood, there’s questions around it,” he says. “I think that the pushback from parents has lessened over the years as they see more of us and see snippets on TV of how big this thing is. Video games are healthy in moderation and competition is healthy. You’ve got to have balance.”

major league gaming dr pepper bottle tom tsquared taylor

Major League Gaming

Tom “Tsquared” Taylor on a Dr. Pepper bottle

MLG has found stars, and a decade into its lifetime, it has helped propel eSports as close to the mainstream as it has ever been. Tom “Tsquared” Taylor was initially attracted to MLG events because of its guaranteed prize pool for Halo in the 2003-2004 season. He was already involved in the competitive gaming scene.”I met with Sundance in Dallas at my first event,” says Taylor. “He said keep doing what you’re doing and stay dedicated and you can be a star.”

That seemed like an impossibility at the time. Taylor showed up to that event crammed into a minivan with a bunch of buddies from college. It was a 22-hour drive and he spent the night trying to sleep on the floor of the van, wedged in between the middle and back seats where the side door was. On the way, they got pulled over, but the police officer let them off for what would have been a $400 speeding ticket because he played Halo too. 

“It was just so much fun,” says Taylor. “I just wanted to compete and I just did it for the love of the game.” Though it wasn’t glamorous, things would change fast. Taylor started winning, and he had the personality to attract a large fanbase. He became one of MLG’s early stars, and he is now as mainstream as any professional gamer in America. 

In 2005, Taylor was featured on MTV’s True Life reality series in the episode “I’m a Professional Gamer.” A film crew shot him for six months, and his life was broadcast out to millions around the world. Three years later, Taylor appeared on a special edition Dr. Pepper bottle. More than 175 million of them were distributed around the U.S. as a promotion for MLG. He has made it a cause to kill the gamer stereotypes that exist, and show the world what the sub-culture is really like, he says.

As stars like Taylor grew, MLG grew right along with them. MLG is now viewed in more than 200 countries across the globe and it has been televised on cable networks in the U.S., though DiGiovanni still isn’t sold on using that platform for eSports. “We need to stop comparing ourselves for the sake of comparing ourselves. Right now we’ve got to worry about making it grow and keeping it healthy,” says DiGiovanni.

“I don’t think that there’s any limit for where it can go,” he continues, curling his lips into a mischievous smirk. “Maybe eSports will get big enough that we’ll have a lockout.”

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