What can you do if a company you love gets acquired by a company you hate?

Patrcik Ronan

This is a bit of an odd way to frame the question. Obviously, it's hard to say one can "love" a company. But surely one can love the products or brand that a company pushes out. And to say you "hate" a company probably refers more to something somewhat outside the actual company—maybe their CEO, maybe their company culture, maybe specific incidents they've been involved in—than the company itself.

Regardless, it's a question many are familiar with, increasingly so with the wave of mergers and acquisitions in the last few years as already massive companies look to get more massive, "synergize", get bailed out, or gobble up the competition.

Personally, I've been asking myself this question with the recent news of two semi-noteworthy acquisitions. First, it was Savvy Gaming Group's (SGG) acquisition of ESL and Faceit for $1.5 billion in January.[1] You probably haven't heard of SGG, but they are a fully owned subsidiary of the Saudi Arabian government's Public Investment Fund. And if you're not super into esports, you probably haven't heard of ESL or Faceit. Once competitors, ESL and Faceit have now merged under Saudi control to be the largest hosts of Esports tournaments and content in the world. They are now practically the ESPN, NFL, NBA, and MLB of Esports all tied into one. If you're a fan of Esports, particularly Counter-Strike, it is now basically impossible to watch the games you love without consuming some form of ESL/Faceit content.

I probably don't need to list the wrongs of the Saudi Arabian government for you. Whether it's their unabashed abuse toward the LGBTQ+ community or serious restrictions on open media and press, the Saudi government's track record has drawn the ire of the Esports community for the last several years as they have attempted to invest large sums of money into various platforms. Last year, for example, a partnership between BLAST, a Danish Counter-Strike organization, and the Saudi futuristic city of NEOM was terminated after it was met with intense backlash from players, talent, and fans.[2]

Another recent transaction brings up some of the same questions. On March 2nd, Epic Games, the developer of Fortnite, acquired Bandcamp for an undisclosed sum of money.[3] Bandcamp is a music streaming service, beloved by fans and independent artists alike, for their high returns for artists, stellar platform, and charitable events like Bandcamp Fridays. They've been praised for essentially being the Anti-Spotify, nurturing and promoting smaller indie musicians by pushing for livable wages.

Admittedly, Epic Games, is nowhere near as bad as the Saudi Arabian government, but fans and musicians have worried that the tech giant, partially owned by the Chinese company Tencent, acquiring the previously independent streaming platform signals the end of everything good about Bandcamp. The biggest red flag for many is Tencent's involvement, who have been under investigation for expropriating users' personal data. Further concerns come from Epic's classic money-making strategy, which involve in-app microtransactions that often exploit naive children. Naturally, when a giant company acquires an independent company, they are wanting to turn a profit. Bandcamp's growth has always put artists first, openly pushing for allowing musicians to make a living wage off their music. Whether this will continue under new management is unknown, but its fans and users will be watching closely.

In these situations, a fan of a newly acquired company or product really has only three options: Exit, Voice, and Loyalty. This idea comes from economist's Albert Hirschman's 1970 book of the same name. A fan can "Exit," by no longer consuming content from the company. Many have chosen that route, including long-time employees and influential journalists of ESL who are giving up thousands of dollars and job opportunities by taking a stand against the Saudi government. [4] A fan can "Voice," by speaking out against the acquirer of the company in an attempt to make change. Or, a fan can express "Loyalty," by just continuing to consume the content of the company, regardless of who is in charge.

Interestingly, the "Voice" option is watered down by the use of a private M&A transaction. While the Esports community was able to push back against a mutual partnership between one of the scene's largest organizations and the Saudi government, the acquisition of ESL and Faceit was able to go through without any roadblocks because, well, it was an acquisition. As long as the owners of ESL and Faceit are willing to sell to the Saudi government, or the owners of Bandcamp to Epic, they will be able to, no matter the outrage from the community that depends so much on the companies. If you're a widely hated company or government that is looking to invest in an industry driven by intense fandom and independence (like sports, indie music, craft beer, etc.) M&A is a ticket around the wave of scrutiny you're destined to face. By the time these nonpublic transactions are made public, the contracts are inked, money has passed hands, and you've already been handed the keys. Outrage becomes just another PR issue for your team to handle moving forward.


[1] https://www.dexerto.com/esports/esl-sells-for-1-billion-in-shock-saudi-takeover-1747441/

[2] https://esportsinsider.com/2020/08/blast-neom-terminated/

[3] https://pitchfork.com/thepitch/bandcamp-epic-games-acquisition/

[4] https://egamersworld.com/counterstrike/news/13143/frankie-refused-to-cooperate-with-esl-amid-the-pur-tVlCGXQN-