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FaZe Clan Announces New West Hollywood Pop-Up Shop
Kristin Snyder
Kristin Snyder is dot.LA's 2022/23 Editorial Fellow. She previously interned with Tiger Oak Media and led the arts section for UCLA's Daily Bruin.
Though it’s not an invite to FaZe Clan’s Burbank mansion, fans of the Los Angeles-based esports and entertainment organization will soon be able to plug themselves into its hype house vibes with the launch of a new pop-up store.
Founded in 2010, FaZe Clan has grown from a small group of gaming YouTubers into a conglomerate of professional esports games, celebrity investors and brand partnerships.
Open during select times and days from May 14 to June 10, The Armory—located at the primo L.A. retail coordinates of Melrose and Fairfax—will be FaZe Clan's first-ever immersive gaming lounge and retail store, the company said in a statement Monday. Livestream shopping platform and FaZe Clan partner NTWRK will oversee the store, designed by FaZe's newly-appointed creative director Jay "JVY" Richardson.
Operating in both physical and digital realms, The Armory will sell FaZe Clan’s custom gaming products and merchandise. Some of the drops will necessitate actually being physically present at the store—a page taken from the playbook of its new retail neighbor, Supreme.
The Armory will also host tournaments and events for the length of its installation, giving fans an opportunity to experience the events that FaZe Clan is known for. Different showrooms will host retail offerings, esports gaming setups and a central screen for console gaming.
“Our approach with this pop-up is showing the fans what's next and where we're at in the future already,” Richardson said in a statement. “The store itself is essentially the vortex entry point and it's being conveyed through the graphics of all the featured items you'll see.”
While this move is set to get the blood of FaZe’s millions of young fans pumping, it may be a smokescreen masking legitimate concerns about the financial state of its business. After announcing plans to go public in a merger with a valuation of $1 billion last year and jumping the gun by adding Snoop Dogg to its board of directors, Sports Business Journal reported last week that SEC filings revealed FaZe to be operating under heavier losses than they’d originally claimed.
The amendment showed FaZe’s EBITDA (earnings before interest, taxes, depreciation, and amortization) currently sits at an adjusted loss of nearly $29 million. (The brand’s original estimated EBITDA showed a $19 million loss.) And since the December 31 deadline for its merger with special purpose acquisition company (SPAC) sponsored by investment bank B. Riley has blown by, FaZe will be unable to access the 75% of proceeds from the SPAC’s $173 million trust account and a planned $118 million private investment in public equity (PIPE) investment it was counting on, SBJ reported.
Meaning: FaZe isn’t making anywhere near enough money to sustain its costs—and with no way to tap into investment funds, the only thing it’s managed to raise is skepticism that FaZe is esports first real unicorn.
Whether or not a flashy pop-up like The Armory can generate enough money to keep a household of gaming influencers in their accustomed lifestyles—let alone sway a market that’s seen scores of SPAC mergers terminated amid bearish market conditions—is anyone’s guess.
Kristin Snyder
Kristin Snyder is dot.LA's 2022/23 Editorial Fellow. She previously interned with Tiger Oak Media and led the arts section for UCLA's Daily Bruin.
https://twitter.com/ksnyder_db
‘We’re Building a Product in a Hot Market’: How Betty Labs CEO Built a Clubhouse for Sports Fans (Exclusive)
03:31 PM | March 30, 2021
Photo by Joshua Hoehne on Unsplash
Things are moving rapidly these days in startupland, particularly in the suddenly crowded red-hot audio space.
Just six months ago, Betty Labs pivoted for a third time – from sports gambling to live audio – and the third time proved to be the charm, as Spotify announced Tuesday it was buying the Los Angeles company for an undisclosed sum.
Betty Labs' Locker Room app is often likened to a sports version of Clubhouse, the much-hyped live audio app that has hosted conversations with the likes of Elon Musk and Bill Gates. But Betty Labs co-founder and CEO, Howard Akumiah, says he actually first saw the appeal of audio conversations after he realized users were more interested in talking to each other than wagering on games.
"The major thing we learned building products around sports betting is that the most important thing you can do for sports fans is facilitate communication between them," Akumiah told dot.LA in a wide-ranging interview before the sale was announced.
Still, he does not deny Clubhouse, which recently raised new funding led by Andreeson Horowitz at an eye-popping $1 billion valuation, has been helpful.
"We're building a product in a hot market," Akumiah said.
He admits people being cooped up inside all day unable to go to sports bars — much less games themselves — has also been beneficial, but he does not think Locker Room's appeal will diminish when life returns to normal.
"People want to talk regardless of whether it is pandemic or post pandemic," Akumiah said. "I think that will continue to be true."
Akumiah started Betty Labs in San Francisco in 2018, when he was still a product manager at Pinterest, as a way to make sports wagering more accessible to a wider audience, hence the name Betty Labs.
"Betty was a personified sportsbook," Akumiah said. "The idea was that you could text this number and Betty would text you back to make bets that were related to what was happening in the game that you were watching live."
Akumiah, who was the one texting people back, soon started getting more action than he could handle.
"I went from hacking this fun thing during the NBA playoffs to basically being an illegal bookie with 500 people on my book," Akumiah remembers. "So I quit my job, shut the product down and I raised a little bit of money to start exploring what was possible."
Akumiah moved to Los Angeles and began hiring.
Betty Labs co-founder and CEO Howard Akumiah
"I moved to L.A. to get closer to the people who would ultimately use the products that we built," Akumiah said. "When I was talking to people about what I was wanting to build in San Francisco, I was met with a lot of confusion."
Betty Labs launched an app called Sideline in 2019, which offered live in-game predictions for sports betting. The predictions aspect did not take off but the social features did.
"People were coming to the Sideline app to talk to other fans about games that they were watching on television," Akumiah said. "If we wanted to take it to the next level, we needed to add audio because we needed to create a medium that is endemic to sports like sports talk radio and podcasting," Akumiah said.
The company raised a $9.3 million seed round last October, with backing from Precursor Ventures, Chapter One Ventures, Maveron, Amazon Alexa Fund, Lightspeed Venture Partners, MaC Venture Capital, and M13. NBA stars Kevin Durant, Andre Iguodala, Baron Davis also participated in the round.
The same month, Betty Labs released Locker Room so users could talk to each before, during or after games. And in this case, talking is what users really wanted to do, a throwback to a time before online chatting, texting or e-mailing.
"I think of the growth in audio not from the consumption side, but actually from the creation side," Akumiah said. "The average person is realizing that they don't have to prepare any materials. They don't have to convert their thoughts to type. They don't have to create a video. They can just begin speaking what's on their mind."
It's not just fans talking to each other. Andre Iguodala and Indiana Pacers center Myles Turner have hosted live Q&As. Mark Stein, the well-sourced New York Times NBA writer, signed a deal with Locker Room last month.
"Instead of doing a podcast, he's going to do regular rooms on Locker Room where answers people's questions about the league and shares his insights," Akumiah said.
Spotify's acquisition is not only a large shift for Betty Labs, but also for the Swedish audio giant. It's Spotify's first major foray into live audio. Interestingly, the company said it plans to soon expand Locker Room well beyond sports to offer conversations focused on music and cultural programming.
"Creators and fans have been asking for live formats on Spotify, and we're excited that soon, we'll make them available to hundreds of millions of listeners and millions of creators on our platform," Gustav Söderström, Spotify's Chief Research & Development Officer said in a statement.
Akumiah added this is an email Tuesday: "Joining Spotify unlocks the ability to grow quickly and deliver that same platform and experience to other communities of passionate fans, whether they want to talk about music, culture or sports."
Spotify is not alone trying to take on Clubhouse. Twitter recently launched a live audio feature, Spaces, and Facebook is reportedly at work on a similar function.
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Ben Bergman
Ben Bergman is the newsroom's senior finance reporter. Previously he was a senior business reporter and host at KPCC, a senior producer at Gimlet Media, a producer at NPR's Morning Edition, and produced two investigative documentaries for KCET. He has been a frequent on-air contributor to business coverage on NPR and Marketplace and has written for The New York Times and Columbia Journalism Review. Ben was a 2017-2018 Knight-Bagehot Fellow in Economic and Business Journalism at Columbia Business School. In his free time, he enjoys skiing, playing poker, and cheering on The Seattle Seahawks.
https://twitter.com/thebenbergman
ben@dot.la
The Lithium Race Takes Shape in the Salton Sea
05:00 AM | November 01, 2022
Located roughly a hundred miles east of San Diego, the Salton Sea is California’s largest landlocked body of water, for now.
Measuring 5 miles across and 35 miles long in its current form, the lake was created by diverting water from the Colorado River into the region for agricultural purposes. Once a vacation destination renowned for its wildlife and wetlands, a series of environmental mishaps and mismanagement have left the lake toxically salty, shrinking and often malodorous. Conditions have gotten so bad that Palm Springs Life Magazine called the region’s transformation “the biggest environmental disaster in California history” in March of 2020.
But against this unlikely backdrop, new life—or at least new industry—is scrambling to set up shop in the region. The Salton Sea, it turns out, is rich with lithium, an element that has taken center stage in the world’s transition to clean energy and its ever-growing demand for batteries. From smartphones to electric vehicles, there’s a pretty good chance that the last battery you used had lithium ions inside. Prices for the metal reached an all time high in September, and futures are up more than 400% since the start of 2021. With Biden’s new economic policy outlined in the Inflation Reduction Act, there are strong financial incentives to move battery production back to North America.
If that’s going to happen the Salton Sea could very well become the lithium capital of North America, or to paraphrase Governor Gavin Newsom, the region could become the “Saudi Arabia of lithium,” and the players are already starting to assemble.
Currently, there are three companies attempting to set up plants in the Salton Sea for direct lithium extraction: EnergySource Minerals, Controlled Thermal Resources and BHE Renewables, a branch of Berkshire Hathaway. All three companies have similar business strategies from a high level, all of which involve geothermal power plants. These plants, which are common in many parts of the world, draw hot, salty water from deep in the ground to create steam which drives a turbine to produce electricity. What makes the Salton Sea so special is that its geothermal brines just happen to contain lithium.
In a 2017 study, researchers from the U.S. DOE Office of Energy Efficiency and Renewable Energy analyzed more than 2,000 samples of geothermal fluid from U.S. sources and found that only 1% had significant lithium concentration. This rare confluence of geothermal activity and lithium presence provides an opportunity for companies to generate electricity and mine lithium simultaneously.
Beyond their marriage of geothermal energy and lithium extraction, the three companies begin to diverge.
According to former dot.LA engagement editor Luis Gomez — whose newsletter Lithium Valle, is essential reading on this topic — EnergySource seems to be out in front early.
“They claim to have the technology that’s patented, they claim to have done the research, they claim to have the funding, and they claim they're ready to go and start production,” says Gomez. “They are kind of considered the canary in the coal mine.”
According to a report from the United States Department of Energy, EnergySource plans to eventually scale production up to over 20,000 metric tons of lithium hydroxide per year using its proprietary Integrated Lithium Adsorption Desorption technology.
Construction on the plant was slated to start earlier this year, but has been delayed. EnergySource has said publicly that lithium production might begin in the second quarter of 2024, but it’s unclear whether this date will also be pushed back. The company has a long history of operating in the region, having run the John L. Featherstone geothermal plant since 2012. The new venture into lithium would leverage that same plant, but without more details about how their proprietary technology works, there’s not much to do but wait and see.
One potential problem facing all three lithium extraction companies is that the Salton Sea geothermal brines are not the same as the brines in evaporation ponds similar to those in Argentina, Chile and Bolivia, where more than half of the world’s lithium is produced. Specifically, the deep geothermal brines in the Salton Sea contain more silica and transition elements, which may complicate the chemistry of purifying the lithium. Still, many researchers are extremely bullish on the prospect of tapping into these reserves. Alex Grant, The Principal at Jade Cove, a research organization focusing on direct lithium extraction technologies, says that much of the skepticism surrounding the technology can be attributed to competing financial interests that are trying to squash the nascent tech’s potential in favor of an established method.
Lithium Mines in the Atacama Salt Flats, Chile from an altitude of 15km via Google Earth. The facility is about 10km wide.
Google Earth
For its part, BHE Renewables, operating as CalEnergy, runs a fleet of 10 geothermal plants in the Imperial Valley. The company had previously announced its intent to set up a direct lithium extraction demonstration plant sometime before the end of 2022 to assess the viability of lithium extraction. If that pilot program goes well, the company could build a commercial-scale facility as early as 2026 with a projected annual capacity of 90,000 metric tons of lithium.
Obviously, having the backing of Berkshire Hathaway comes with advantages and capital. Add into the equation another $15 million in DoE grant money obtained last winter, and BHE appears to be well positioned as a major player in the long term.
Finally, there’s Controlled Thermal Resources. As the only company not already operating a geothermal business in the region, CTR is something of an outsider and dark horse. By 2024, the company hopes to build both a geothermal energy plant and a direct lithium extraction plant to operate in parallel, projecting a capacity to extract 300,000 metric tons of lithium carbonate equivalent annually by 2030. As dot.LA previously reported, Controlled Thermal Resources has partnered with Statevolt, a company that intends to build a $4 billion gigafactory nearby that will run on power from CTR’s geothermal plant and make batteries from the lithium it extracts. It’s a beautiful closed-loop business model. But again, all of this relies on the direct lithium extraction technology, and details are scant.
According to Gomez, despite the typically cut-throat nature of the energy industry, the relationship between the three upstarts in the Salton Sea is often surprisingly cooperative at the moment.
“They want the others to succeed because it kind of gives them the confidence that their technology is also eventually going to succeed,” he says. “It gives confidence to investors.”
Which is all to say, there may well be space for all three companies if the technology is as solid as they claim. If that’s the case, the Salton Sea and its surrounding region may have yet another miraculous transformation up its sleeve.
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David Shultz
David Shultz reports on clean technology and electric vehicles, among other industries, for dot.LA. His writing has appeared in The Atlantic, Outside, Nautilus and many other publications.
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