Melbourne’s ORDER Esports Enters Voluntary Administration

Melbourne’s ORDER Esports Enters Voluntary Administration

Melbourne esports team ORDER has entered voluntary administration.

A new report from The Australian has detailed the popular team’s seeming financial collapse, which comes after it raised $5.3m in private funding in 2021, the largest captain raising for an ANZ esports org at the time. Former Melbourne Demons executive Marc Edwards was appointed as CEO. CPS Capital managing director Jason Peterson and Gemelli Group chairman Harry Karelis led the charge on raising that capital, and Karelis was appointed to ORDER’s board of directors. The company’s ASIC records show that it is currently under external administration.

The news comes only weeks ahead of Dreamhack Melbourne, an international esports tournament launching its first Australian event. ORDER was expected to have a significant presence at Dreamhack Melbourne. ESL Australia Marketing and Sales Head Graeme Du Toit says it is currently unknown if ORDER’s teams across Counter-Strike: Global Offensive, League of Legends, Valorant, Fortnite and FIFA, will still be represented at the event.

“We’ve been working with ORDER’s LCO team and can confirm that they will still be attending DreamHack Melbourne to compete at the LCO Split 2 Finals Delivered by Menulog with their full roster, so fans who’ve already booked their tickets won’t be disappointed,” Du Toit confirmed to Kotaku Australia via email. “With regards to ORDER competing at ESL Challenger Melbourne at DreamHack, we’re still identifying how this is affected by the recent news.”

As news of the company’s fate began to spread online, many in the OCE esports space responded with disbelief. Industry observers quickly expressed concern that the shadow ORDER casts over the local competitive scene could drag other orgs down with it.

As the morning wore on, players from ORDER’s teams began to announce their departures.

As gloom about the industry’s fortunes in Aus began to set in on social media, other industry corners remained positive about the future of esports.

“Feeling for the tough time many good people in the ORDER staff and teams are going through,” said CouchWarriors and BAM organiser Dan Chlebowczyk. “We don’t believe it reflects the state of the wider esports scene, however.”  Chlebowczyk points to BAM’s recent record-breaking attendance as a sign of industry health. After we experienced a record breaking attendance at BAM, our last major event, and ongoing CouchWarriors League, it shows there’s a strong groundswell of community support for esports and competitive play.”

This sentiment was echoed by Kanga Esports CEO Hayden Sheils. “It’s always sad to see any company go into administration, although we don’t believe this has anything to do with the local esports industry,” said Shiels via email. “We have seen that with the correct business model and team, you can achieve similar goals in Australian esports without massive capital cost.”

“Although today’s news comes as a shock, 2022 is still on track to be the biggest year for Australian esports to date,” said ESL Australia’s Graeme Du Toit. “As we mark the return to live, stadium-scale esports events this year with DreamHack Melbourne, the industry is coming out of COVID-19 strong, and has never had more commercially successful teams operating in the space as there is today. Teams that continue to operate sustainable business models will be rewarded with the continued growth that we’ve seen in the space over the last few years.”

However, despite The Australian‘s assertion that ORDER has fallen, conflicting stories are emerging about where the company currently stands. ORDER’s chief gaming officer Chris Orfanellis wrote on TwitLonger that the business was not dead, but was, in fact, for sale.

This is a perfectly reasonable assertion to make. Under the rules laid out by ASIC, a company can be placed into voluntary administration and still seek a buyer.

When a company is placed into voluntary administration, the goal is to figure out what its future looks like with speed. Management of the company’s assets is turned over to an external party, or ‘administrator’. The administrator’s goal is to find a way to save the company, including its potential sale to interested parties. It will do this by investigating the company’s business, property, affairs and financial circumstances, and reporting the details to its creditors. From there, decisions will be made on how to resolve the company’s debts, and, if it can be saved, return the company to its directors. If it can’t be saved, the administrator will begin to close the company down and turn it over to a liquidator.

Kotaku Australia has reached out to representatives from ORDERincluding its CEO Marc Edwards for comment. We have also reached out to parties in the wider OCE esports community for comment. We will update this piece as they come to hand.

ORDER defeated Encore in the CS:GO RMR closed qualifiers just last night.

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