KOVA esports’ backer Esports Media Solutions Oy, has filed for bankruptcy. KOVA had been in business for three years, but financial problems doomed the organization.
The company behind the organization was declared bankrupt on Wednesday through social media. The company’s biggest creditor, Mediatalo Keskisuomalainen, no longer wanted to finance the loss-making business.
KOVA had teams in video games such as Counter-Strike: Global Offensive, Valorant, and Farming Simulator. The organization has also won several Finnish digital car racing championships under the leadership of Tuomas Tähtelä. The company also owned eurheilu.com, an esport news website.
The bankruptcy petition was filed due to the depletion of cash resources and the company’s insolvency. According to the bankruptcy petition, the company had total debts of almost €150 000 and assets of less than €30 000, mainly computers and furniture.
If such sums needed to be raised quickly, Trustly nettikasinot, for instance, would probably be one of the addresses where players would go to raise funds. This would, of course, be a completely absurd way to fund future operations. Realistically, the sums are impossible for a small organization to conjure up in any way.
The company’s biggest creditor is the team’s co-owner, Mediatalo Keskisuomalainen Oy, to whom the company owes around €100 000, according to the bankruptcy petition.
The other company shareholders also have claims of more than €30 000 and the Tax Administration of around €9 000. In addition, there is a furniture company with claims of €9 000.
According to YLE, KOVA team manager Timo Tarvainen announced the bankruptcy filing on Tuesday evening on Twitter. Vesa-Pekka Kangaskorpi, Group CEO of Mediatalo Keskisuomalainen, the company’s largest creditor, said that Keskisuomalainen wanted to stop the accumulation of losses.
The company ran out of patience in capitalizing and financing the company. KOVA, as a company, did not perform as well as expected in sporting terms or find partnerships that would have allowed it to live profitably. Mediatalo Keskisuomalainen had to lend and support the company financially, but now they have blown the whistle. These were the circumstances that led to the bankruptcy.
From Mediatalo Keskisuomalainen’s point of view, it was about building a new media product in Keskisuomalainen’s media portfolio alongside digital media and magazines. Meditalo’s readership and advertisers have been interested in e-sports, so it was only natural to reach customer groups through this channel.
Seeing KOVA go down is a real shame for the Finnish esports markets.