FaZe Clan Reportedly Mulling Private Exit After Only 8 Months On NASDAQ

Los Angeles-based FaZe Holdings Inc FAZE, the prominent esports and entertainment organization, has experienced a significant decline in its value since its public debut in July 2022.

Established in 2010 as a gaming clan for Activision Blizzard Inc's ATVI "Call of Duty," FaZe has evolved into a lifestyle brand and now represents some of the most prominent figures in the gaming, music, sports, and entertainment industries. Notably, the organization has partnered with major brands such as Coca-Cola, Microsoft, Sony's PlayStation, and McDonald's.

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However, according to Sports Business Journal, FaZe is considering a move to go private, and facing difficulties in its effort to do so.

In its most recent quarterly filing, the company revealed it possesses $43.9 million in cash assets, which is anticipated to sustain the organization until November of this year.

Nevertheless, sources told Sports Business Journal that FaZe requires funding of between $40 million to $60 million to restructure the company. This undertaking has proven to be challenging given the esports ecosystem's current state. The industry has experienced a funding drought in recent times, with numerous companies either folding or undergoing significant layoffs.

FaZe Clan's current market cap is valued between $30 million to $40 million, which pales in comparison to the company's previous valuation of $1 billion. On August 30, 2022, FaZe Clan's shares peaked at $24.69, but the company's fortunes took a sharp turn for the worse, with its stock plummeting to $0.37 on March 10, 2023. FaZe is trading at $0.64 on Monday, down 3.71%  at the time of publication.

FaZe Clan's extended period of trading under $1 results in noncompliance with NASDAQ regulations.

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