This 91³ÉÈË Built and Sold a Franchise for Millions. Now He's Betting Big on a $1.38 Billion — and Growing — Industry. David Graham built and sold Code Ninjas for millions. Now, he's all-in on an emerging franchise market.
By Carl Stoffers Edited by Jessica Thomas
Key Takeaways
- David Graham, founder of Code Ninjas, successfully expanded the company to more than 300 locations and later sold it to a private equity firm.
- Recognizing the rising popularity and potential of esports, Graham is betting big on the market with a new franchise.
- Graham's goal is to make the new franchise synonymous with trust, legitimacy and credibility in the esports and gaming education sector.
David Graham has already lived the entrepreneur's dream — founding Code Ninjas and scaling it to more than 300 locations before for millions in 2021. This success story is a testament to his vision and determination, yet in the wake of the sale, Graham pondered his next move.
"When I sold , I thought, I've made a career out of STEM, and those are great things, but there's another side of that coin — what are the soft skills that the kids are going to need for tomorrow?" Graham says. "The things that you would normally ascribe to soccer, football or another team sport: teamwork, camaraderie, achievement."
So Graham founded Valhallan Esports Training in Houston in 2022 to create a place where kids can not only practice gaming under the watchful eye of pro coaches but also build a community he saw as sorely lacking in gaming. The concept is a mix of Graham's love of STEM, nostalgia and seeing the potential in a rapidly growing market. "I grew up in the '80s, and the mall arcade became the quarter-eating capital of my life," he says. "We had a camaraderie that I don't think exists anymore around video games. It's a lot different than playing online."
What are Esports?
Esports, or electronic sports, transform video gaming into a highly competitive and organized spectator sport. Unlike recreational amateur gaming, played on or consoles, professional and competitive amateur gaming is played on special gaming computer consoles. Competitors from different leagues or teams face off in popular video games that range from real-time strategy and first-person shooters to multiplayer online battle arenas.
One of the key differences between traditional sports and esports is that physical maturity and stature play no role in success or potential. "We have 13-year-old kids who are the top .001% of players in a particular game," says Luke Zelon, Valhallan's VP of media and partnerships. "They could be playing with 21-year-olds; it doesn't matter what they look like or how big they are."
This nascent industry attracts a global audience and draws substantial investments from major brands, such as and , and offers career opportunities for gamers.
Esports in college and the pros
Esports in U.S. colleges are organized through a combination of formal and informal structures, reflecting its growing recognition as a legitimate sport. In this rapidly evolving landscape, the formed in 2019 to provide structure to junior college esports. The National Association of College Esports (), , provides another option for structure and governance in college gaming.
Another significant development has been establishing official teams at major colleges, such as , , and , paralleling traditional sports programs. These esports programs stand out for their competitive gaming focus and the comprehensive support structure they offer, including , state-of-the-art equipment, travel costs for competitions and other related expenses. These programs also have dedicated coaches, trainers and support staff.
There are several prominent pro leagues and tournaments, including The and the in soccer; the in basketball; and the series, an array of official tournaments organized by centered around the Madden NFL game. Lastly, , though not a traditional sports game, has carved out a significant niche in the esports world by blending elements of soccer with vehicular acrobatics and hosting the .
In 2022, the global esports market was valued at just over . Additionally, the esports industry's global market revenue was forecast to grow to as much as in 2025. Asia and North America currently represent the in terms of revenue, with China alone accounting for almost of the market.
Related: Want to Become a Franchisee? Run Through This Checklist First.
Valhallan Esports
features a training program similar to traditional sports in terms of schedule. "One day a week, they'll have practice," Graham says. "Every team is coached." He adds that colleges are interested in forming a pipeline for high-talent gamers. "Colleges are engaged with us, and we built a platform that we're testing right now that tracks grades and players' different kinds of gaming KPIs, so a school is recruiting from a better place than just watching a couple of games."
Parents frequently raise concerns about their kids spending more time gaming. Valhallan, Zelon says, focuses on the social and educational aspects of this experience. "Our answer is, 'Certainly, you're right.' This is not about them playing more. It's about them playing in a better environment. A lot of parents use us as a way to moderate screen times."
The program focuses on acquiring valuable skills and learning to collaborate effectively, Zelon says. Participants not only interact with their teammates but also engage with adult coaches, which is crucial for learning to communicate with authority figures. Valhallan gamers train on five games: , , , and .
The 'Little League of video games'
Valhallan currently has 65 units open in North America and 100 locations in the UK, and discussions are underway for an additional 70 across the Middle East. Graham, who knows something about scaling growth, is in no rush to expand too fast. "We know how to grow," he says, "My team here is the same team that grew Code Ninjas, so we're very capable. We're not going about it tactically the same way, but the world domination strategy is similar."
Graham says that several franchisees are current and former NFL players who have opened locations in their hometowns, adding that a strong connection to the community is critical for an esports franchise.
Zelon is convinced that in "10 years, maybe 20 years," esports will compete at every college. That said, Zelon has a goal for Valhallan: "To become the Little League of video games," he says. "The place where kids are getting their start in a team environment, developing their love for the games and understanding how to work with others. From a brand perspective, we want our name to be synonymous with the trust, legitimacy and credibility among players and parents."
