How Do League of Legends Teams Make Money?
The spotlight brightens up the stage as five pros lift a trophy more valuable than most people’s rent. Onstage, these players have made it past every opponent in a League of Legends tournament. But behind the highlights and confetti lies a question that separates the fans from those who work with the teams: “How does an organization afford to pay these players millions of dollars?”
Many will say, prize money! However, the answer is far different, with prize money only representing a tiny portion of the pie. Instead, modern esports teams fund their operations through brand partnerships, digital goods, and media influence, with some even evolving into full-on entertainment companies!
To truly understand their business structure, let’s run through the fundamental economics of LoL esports and take a look at the profit structure behind every successful League of Legends team.
Franchising: How Teams Gained Stability
The professional League of Legends scene used to be a gamble. Teams lived and died by promotion and relegation.
This was a harsh system where a single bad season could end an entire organization. That same uncertainty also scared off investors, as many wouldn’t want to invest in a team that could lose its place just a year later.
Riot Games knew this all had to change, so, between 2017 and 2019, they introduced a franchise model to the LCS in North America, the LEC in Europe, and the LCK in Korea. Teams that paid buy-ins reportedly ranged between $10 million and $13 million, securing a permanent spot at the table.
The rule was rewritten from then on, as franchising offered something priceless: stability. With that stability, organizations could finally plan for their future. They could build fanbases, develop talent, and walk into meetings to negotiate multi-year deals with global brands.
Sponsorships: The Biggest Source of Money
Walk into any esports stadium or watch a tournament online, and you’ll see the sponsorships. From team jerseys to the equipment each team uses, these sponsorships are the most significant revenue source for any top-tier League of Legends team.
They are also no longer limited to gaming devices and energy drink companies, either. The sponsors backing major teams are now bigger names. For example, Nike and Red Bull support T1. G2 Esports collaborates with Adidas. Fnatic has deals with BMW and Crypto. And platforms like ThunderPick are sponsoring teams like Heroic.
These partnerships go far beyond a simple logo slap, though. Deals often include social media campaigns, co-branded content series, exclusive events, and many more forms of collabs. The team becomes a media partner for a brand to speak to a whole community that traditional advertising struggles to reach. This is what pays the superstar salaries and funds the coaching facilities.
Digital Content: Fans Funding Teams
Riot Games created a system that allows fans to support their preferred teams by buying items within the game, with each purchase of team-branded icons, skins, chromas, or emotes generating funds for the team's revenue.
Riot shares up to half of the revenue from in-game items with the partner teams, and with a global player base of over 150 million, this adds up fast. In some good years, the revenue reached over $100 million for the top teams!
It’s a self-sustaining loop: the more popular a team is, the more fans buy their items. And the more revenue they generate to sign better players and create more content, in turn, makes the team more popular.
Other Important Ways Teams Make Money
Let’s check out several other key revenue streams, as no pro LoL team relies on a single source of income.
Media Rights
Riot establishes significant partnership agreements with Twitch and YouTube, distributing a portion of its revenue to franchised teams.
Merchandise
Merch no longer equals jerseys. Teams now release limited-edition streetwear and fashion collaborations that sell out within minutes. These products improve brand identity while generating steady income from fans who want to wear their allegiance.
Live Events
Nothing beats the vibe of a packed arena during Worlds or regional finals. Ticket sales from these sold-out venues, which can host tens of thousands of fans, bring in massive amounts of revenue.
Prize Money
Tournament winnings may grab headlines, but they’re more of a bonus than a foundation for success. Even a World Championship victory is a short-term payout, substantial for the fame but not nearly as reliable as other income streams.
Pro Player Salaries
With all this money flowing in, where does it go? A good portion is invested directly into talent, as player salaries in the top leagues are high, ranging from 6 to 7 figures annually. These assets can drive their brand valuations up to around $500 million.
The Professional League of Legends scene has completely blurred the line between athlete, entertainer, and entrepreneur. The teams that thrive understand they need to focus not only on winning games but also on building a brand and community.
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