How Magnus Carlsen turned his chess skills into a business empire


By the time Magnus Carlsen, a Norwegian chess grandmaster, was 16, he was successful enough that his parents, Henrik and Sigrun, decided to form a small business to manage his winnings. Henrik said at the time that he hoped Magnus would earn enough at age 25 that if he decided to stop playing he would at least be financially independent.

Magnus exceeded this relatively modest target.

Carlsen, the reigning world champion, will be 31 at the end of the month, just days after opening his title defense on November 24 in Dubai in a best-of-14 match against Ian Nepomniachtchi, a Russian grandmaster. The prize pool for the event is $ 2 million. Up to 60 percent will go to the winner.

Yet winning or losing the salary will only gradually add to the millions of dollars Carlsen has earned over the course of his career. He also did something that none of his contemporaries or predecessors, not even Garry Kasparov, who held the world title from 1985 to 2000, managed to do: he leveraged his fame to become one. of the greatest impresarios in the world of chess. In the process, he amassed a small fortune.

Carlsen has several private sponsorship agreements, including with Unibet, a sports betting site; Isklar, a Norwegian water company; and Simonsen Vogt Wiig, a Norwegian law firm. But the main vehicle of its business ventures is Play Magnus, a company he co-founded in 2013, when he became world champion.

Originally conceived as an app allowing users to emulate Carlsen’s playstyle and strength at different ages, Play Magnus has grown, mainly through acquisitions, to become a company with a dozen subsidiaries. It now includes an online gaming site, multiple education and training platforms, and digital and book publishing branches.

According to Andreas Thome, Managing Director of Play Magnus, the company has around 250 employees and around four million registered users of its proprietary learning products and programs. One year after its initial public offering on Euronext Growth Oslo, Play Magnus now has a market capitalization of approximately $ 115 million. It is the only publicly traded chess company in the world.

Magnus Chess, the private entity created when Carlsen was 16 to manage its earnings, owns nine percent of Play Magnus, making it the second largest shareholder. Magnus Chess, in turn, is 85% owned by Carlsen; that makes his personal stake in Play Magnus worth almost $ 9 million.

Although Carlsen plays no role in the day-to-day operations of the company that bears his name, he has a disproportionate influence on its strategy. His father sits on the board of directors and Magnus Carlsen is consulted on important decisions.

“We have very good communications with the management of the company,” said Henrik Carlsen. “We are in contact a lot. They really want to have Magnus on board for every big decision. It’s a kind of symbiosis.

Thome echoed the point. “What’s important for Magnus is to make the game more accessible for more fans around the world,” he said. “The ideas he advocates are definitely the backbone of what the company believes in.”

Carlsen’s ideas have long influenced the company’s acquisition strategy.

“He really wanted a play area when we only had the apps,” said Henrik Carlsen. Magnus therefore pushed for the merger in March 2019 with Chess24, one of the main gaming sites on the Internet.

Then last year, with the pandemic shutting down all in-person tournaments and postponing the world championship, the company decided to create its own competitions. Once again, Thome said, Carlsen has been asked to advise.

“We’ve worked a lot with Magnus on this,” Thome said. “What could be an interesting concept to engage more fans around the world? What should the format be? “

Play Magnus hosted a series of 10 mostly online tournaments with $ 1.6 million in prizes. The events featured 44 of the world’s best players, including Carlsen.

The inclusion of top players, including the world champion, helped the tour attract sponsors. Among those who signed up was Meltwater, a media intelligence firm, for which the tour has been renamed; FTX, a cryptocurrency exchange; and Mastercard. Julius Baer, ​​a Swiss wealth management bank, has become the main sponsor of a second challengers tour for emerging players.

The Meltwater Tour final took place last month, partly in an esports studio in Oslo built by Play Magnus. Unsurprisingly, Carlsen won. He also raised the largest share of the season’s purse – just over $ 315,000. Wesley So, an American, was second and pocketed $ 215,000.

This made the tour created and managed by Carlsen’s company financially lucrative for Carlsen, a result that Thome said was not a problem.

“The fact that Magnus strongly supports the tour, participates in the tour, takes it seriously, participates in the competition, ensures that other top players are playing it and is very valuable to the company,” he said. he declares. This, he argued, was good for both the company and its shareholders.

In its third quarter report to shareholders, Play Magnus said the tour had 115 million live views and 29 million hours of video watched, which puts it on track, Thome said, to reach the financial balance. Nonetheless, the company reported a loss of $ 5.3 million for the third quarter, bringing its 2021 losses to over $ 14 million. With cash reserves of nearly $ 22 million, these losses appear to be lasting for now.

Play Magnus has already announced that it will host another Champions Tour, with nine tournaments, starting in February. The company is also creating a regional tour in India.

“Over time,” said Thome, “we would like our Champions Chess Tour to be to chess what the PGA is to golf or what Formula 1 is to racing.”

Henrik Carlsen, who has always been there alongside his son throughout his career – part confidant, part support team – admitted that being the face of Play Magnus had put extra strain on his son. But he said Magnus has always been able to compartmentalize his business and competitive interests.

“Thinking about the business consequences when playing a tournament or even for the world championship is absurd,” said Henrik Carlsen.

His son is favorite to keep the world championship when he plays at Nepomniachtchi; he is better ranked than his challenger and has a lot more match experience. But even if he loses, that might not have a material effect on the financial prospects of his business interests.

“The Play Magnus group of companies is very diverse in terms of revenue sources,” Thome said. “Some of these streams are more related to Magnus than others, so it’s best to have him as the world champion. But I think Magnus has achieved status in the chess world thanks to his performance over a very long time. period, which means he will be a legend of the game forever.

Carlsen and his family believe in the company so much that when the stock price fell recently, they stepped in to buy shares – around 100,000 in the past six months, according to Henrik Carlsen.

As for the goal of financial independence that he and his wife set for Magnus at the age of 16, Henrik Carlsen now waved it aside. His son, he said, had passed him “by far, by far”.


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