27 November 2023

Blue Star Capital plc

("Blue Star" or the "Company")

Dynasty Update

Blue Star Capital plc (AIM: BLU), the investing company with a focus on esports and blockchain and its applications within gaming and payments, provides the following update following information received from its investee company, Dynasty Gaming & Media Pte Ltd ("Dynasty").

Dynasty advises that it has recently completed a fundraise by way of a Convertible Loan of US$3 million which, in conjunction with its move from technology supplier to operator and significant cost reductions, should fund it to breakeven with free cash flow generation by no later than July 2024. In addition, Dynasty also announces a proposed merger with Googly Media Pte Ltd ("Googly").

Operational Highlights

Dynasty's original business plan was to provide its gaming platform to large telecoms companies, for which it initially had much success, contracting with large telecoms companies including STC, Maxis and Spark which generated fixed monthly licence fee income. However, Dynasty advises that operational complexities, including the need to support several different and highly customised platforms, led to a pivot to focus on launching B2C platforms with more strategically aligned and complementary partners and in the process, maintaining control of its products and contact with the end users. As a result of extensive technology development during the period since, Dynasty's platform has now moved to a single code base, meaning time to launch in new markets has been reduced from at least nine months to one month.

Dynasty has stated that their management team believes it has built the leading and most comprehensive gaming/esports platform globally, which combines the following features, licences, and accreditations in one single platform:

·    Enterprise grade international esports tournament engine accredited and endorsed by major international games publishers including Riot, Activision and Supercell to run professional leagues and mass market grassroots esports feeder leagues.

·    The only enterprise grade esports platform and gaming shop:

o  that supports international standard professional esports tournaments for both PC and Mobile games, the world's fastest growing gaming sector;

o  that is optimised for key hyper-growth 'mobile first' markets. Dynasty optimised its mobile experience to 30MB, perfect for mobile first markets such as India, Africa, SEA and LATAM;

o  that incorporates a payment wallet, subscription engine, digital voucher and top up shop, with full security accreditation;

o  that can deliver and launch a fully branded, fully functional partner platform within 4 weeks. This has been enabled by a single code cloud-based code structure.

·    Full customer relationship management campaign engine to increase monetisation and engagement.

·    Unique User Generated Tournament engine (UGT) that allows users to create entry fee and prize pool tournaments, sharing in platform monetisation. Patent pending.

·    The only enterprise grade esports and gaming shop with an AI Academy, allowing players to improve in game performance.

Dynasty now has live B2C platforms in several key gaming markets including Googly in India, Lets Play Live in Australia and New Zealand and Paidia Gaming in North America. Further details on these platforms are summarised below:

·    Googly: Dynasty advises that India is the world's fastest growing gaming market, with over 750million gamers forecast in the country by the end of 2026, spending more than US$6.7billion. By most metrics, the rate of growth in gaming in India is more than double the average of the rest of the world - this includes more mature, slower growth markets like North America and Europe, but also accelerating regions such as Latin America and Southeast Asia. The future growth of gaming in India will continue to be almost entirely driven by mobile, fuelled by a young population of digital natives, increasing wealth, and mass smartphone adoption. Googly's platform offering provides India's gamers a diverse, immersive experience, catering to all levels of casual and competitive gaming, including - leaderboards, live broadcasts, engaging content, unique user-generated prizepool tournaments, and a market leading games shop. Initial traction has been encouraging and discussions are progressing with a number of strategic partners.

·    Lets Play Live: The platform was launched in June 2023 with the Company's 50/50 JV partner Lets Play Live, the region's leading tournament organiser and gaming content creator. Within the first six months of operation, the platform has already become Oceania's largest and most successful gaming platform with over 420,000 users. Major official publisher-led national and regional tournaments secured with an extensive calendar scheduled throughout 2024 for leading games titles including Valorant, Fortnite, and Clash Royale.

·    Paidia: is a female focussed gaming platform with a highly engaged and fast-growing community. Major strategic partnerships have already been signed with leading brands including e.l.f. Cosmetics, Razer, and Xbox.

Outside of these live platforms, Dynasty have also announced that they are on schedule to launch in the Philippines in early December 2023 under the platform brand "Lightning Dragon" with a major media conglomerate as its partner. The Philippines is one of Southeast Asia's largest and fastest growing gaming markets, and like India, predominantly favours mobile gaming. With significant partners already secured, Lightning Dragon is set to become the default home of gaming in the Philippines. Dynasty is also progressing further platform opportunities in Indonesia, Africa and the Gulf.

Prospective merger with Googly

Dynasty further advises that, as a result of working increasingly closely with Googly on opportunities in India during the last 12 months, and with the prospects of extending the collaboration into further countries, the boards of both companies consider their prospects are best achieved through an equal merger.  Further details of this potential merger will be disclosed as the transaction develops, with shareholder approval anticipated before the end of 2023.

Dynasty Fund raise

As part of the US$3 million fundraise undertaken by Dynasty, the Company has invested $75,000 immediately and has an option to invest a further $75,000. The Convertible Loan has a two year expiry period, is non-interest bearing and converts at a discount of 50 per cent to Dynasty's next funding round. The fund raise was supported by existing shareholders with two new strategic investors participating.

Blue Star has been an investor in Dynasty since 2019 and has a shareholding of 13 per cent pre conversion of the Loan note. Additionally, the Company holds 0.6% of Googly. 

Tony Fabrizi, Executive Chairman of Blue Star Capital said, "Like many early-stage businesses, Dynasty's management have needed to adapt their business model as the opportunity and market conditions have evolved. We are fully supportive of the Company's recent decisions and believe Dynasty's dual focus on building a highly scalable business in India, the fastest growing gaming market globally, as well as partnering with strategic partners in other regions will optimise the value of Dynasty's tech platform."

This announcement contains inside information for the purposes of the UK Market Abuse Regulation and the Directors of the Company are responsible for the release of this announcement.

For further information, please contact:

About Blue Star

Blue Star is an investing company with a focus on new technologies. Blue Star has two principal investments: SatoshiPay Limited, an incubator and service provider to de-fi businesses using blockchain technology; and Dynasty Gaming & Media Pte. Ltd.,

About Dynasty

Dynasty is widely recognised as the industry leader in the development of digital platform ecosystems for mass-market gaming. With over 8,000 tournaments completed, 500,000 tournament participants, and over US$10million in platform-related revenue generated, Dynasty has significant momentum and a global presence.

Forward looking statement disclaimer

Certain statements made in this announcement are forward-looking statements. These forward-looking statements are not historical facts but rather are based on the Company's current expectations, estimates, and projections about its industry; its beliefs; and assumptions. Words such as 'anticipates,' 'expects,' 'intends,' 'plans,' 'believes,' 'seeks,' 'estimates,' and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties, and other factors, some of which are beyond the Company's control, are difficult to predict, and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. The Company cautions shareholders and prospective shareholder holders not to place undue reliance on these forward-looking statements, which reflect the view of the Company only as of the date of this announcement. The forward-looking statements made in this announcement relate only to events as of the date on which the statements are made. The Company will not undertake any obligation to release publicly any revisions or updates to these forward-looking statements to reflect events, circumstances, or unanticipated events occurring after the date of this announcement except as required by law or by any appropriate regulatory authority.