FaZe Clan Went Public at a $725M Valuation in 2022. GameSquare Bought It for About $17M in 2024.

The proxy that asked shareholders to approve the merger disclosed, in its risk factors, that FaZe already expected to miss its own 2022 revenue forecast by 20% before the stock ever traded.

A creator collective that closed its public-market debut valued at about $725 million sold itself twenty months later for roughly $17 million, and the company's own filings show it told investors it would miss the projections underpinning the deal before the shares started trading.

When FaZe Holdings completed its merger with B. Riley Principal 150 Merger Corp. and began trading on Nasdaq as FAZE on July 20, 2022, the deal carried a reported valuation of about $725 million — already down from the "approximately $1 billion" implied equity value B. Riley and FaZe had announced in October 2021. By March 8, 2024, GameSquare Holdings had closed an all-stock acquisition of the whole company at an exchange ratio of 0.13091 GameSquare shares per FaZe share, a price Bloomberg put at around $17 million. Against the de-SPAC valuation, the audited sale came in at roughly two cents on the dollar.

What explains the collapse is not the sale price but a gap FaZe placed in the public record itself: between the forecast it gave the SPAC board and the miss it disclosed in the same document that asked shareholders to approve the deal.

The forecast that sold the deal

The forecast sat in the investor presentation FaZe and B. Riley filed with the SEC in October 2021. On its financials slide, it projected revenue climbing from $50 million in 2021 to $91 million in 2022, $188 million in 2023, $379 million in 2024, and $651 million in 2025. Adjusted EBITDA was modeled to swing from negative $19 million in 2021 to positive $131 million by 2025. The deck pitched the combined company at a $713 million post-money enterprise value, which it framed as revenue multiples of 3.8x, 1.9x, and 1.1x on 2023, 2024, and 2025 estimates — multiples that look cheap only if the out-year revenue arrives.

Those out-years rested on revenue the company did not yet have. FaZe's audited 2021 results, filed in the same merger process, showed revenue of $52.85 million and a net loss of $36.9 million, against a balance sheet where total liabilities of $110.3 million exceeded total assets of $37.1 million by $73.2 million [3a][3b][3c]. The 2025 projection of $651 million implied roughly 12 times the revenue the company was actually booking, built on stated assumptions of future acquisitions, international expansion, and an expanded content slate.

The miss was disclosed in the document selling the deal

In its June 2022 proxy statement and prospectus — the 424B3 that asked shareholders to approve the merger — FaZe republished the forecast table, then conceded in the risk factors that it already expected to fall short. The filing states FaZe expected "revenues for 2022 to be lower than projected in the FaZe Forecasts by 20%," and separately that it expected its "actual 2023 results to differ materially from the FaZe Forecasts," citing a reduced content slate and stalled consumer-products and international expansion [2a].

The same filing that carried the $651 million 2025 number carried the disclosure that the near-term numbers were already breaking. A shareholder who read past the forecast table to the risk factors had, in June 2022, the company's own statement that the growth curve the valuation rested on would not materialize on schedule.

The disclosure proved accurate. FaZe reported full-year 2022 revenue of $70.0 million, up 32% year over year and, in management's words, "in line with our target for the year" — but $21 million short of the deck's $91 million projection, a miss within a point of the 20% it had pre-announced. The deck's $188 million target for 2023 never came close: first-half 2023 revenue fell 30% year over year to $24.2 million, with a net loss of $28.4 million.

The capital never showed up either

The valuation was not the only number hollowed out between announcement and close. The October 2021 deal contemplated roughly $291 million in gross proceeds. After SPAC investors redeemed, the closing disclosures reported FaZe took in net proceeds of $57.8 million and held $61 million in cash. A company projecting a path to $651 million in revenue — partly on acquisitions it had not yet made — emerged from the de-SPAC with about a fifth of the capital the deal had assumed.

The market repriced fast. FaZe shares fell on debut, closed at an all-time high of $20.08 on August 9, 2022, then dropped below $1 by early 2023 [6a]. The FY2022 10-K, filed April 4, 2023, carried explicit going-concern doubt — a year before the sale to GameSquare closed. FaZe's accumulated deficit reached $280.9 million by the end of 2022, against a $168.5 million full-year net loss [3b].

The audited verdict

GameSquare announced the all-stock acquisition on October 20, 2023, and closed it on March 8, 2024, at which point FAZE and FAZEW ceased trading[11a]. The DEFM14A pegged the implied value of the consideration at $0.2108 per FaZe share, based on the 0.13091 exchange ratio and GameSquare's October 19, 2023 closing price [8a]. Against the 77,391,928 FaZe shares outstanding at the January 2024 record date, that works out to roughly $16.3 million in equity consideration [8b] — the basis for the ~$17 million figure Bloomberg reported.

What the audience was worth in pieces versus whole is sharpened by a postscript. After buying all of FaZe, GameSquare carved out a unit called FaZe Media and sold a 25.5% stake in it for $9.5 million in June 2024, a price implying roughly $40 million for that piece alone. The parts the new owner chose to keep and remarket were valued, within months, at more than twice what GameSquare had paid for the entire company — a measure less of FaZe's recovery than of how little the going-concern public entity fetched at the bottom.

For an investor pricing a creator collective, the FaZe arc is a clean dataset. A SPAC deck can model 12x revenue growth on unnamed future acquisitions, the proxy that follows can disclose the miss, and the audited transaction that settles the question can arrive at two cents on the dollar — with the forecast and its retraction sitting in the same filing the whole time.