Riot's lec franchise model bleeds millions, but provides marketing value

Riot Games' European League of Legends (LEC) franchise model has generated significant losses for the developer since its inception, with a record-high deficit of €28.5 million in 2023. However, the esports league has seen a substantial increase in revenue, growing from approximately €7 million in 2023 to €18.4 million in 2024 – a 162% surge.

Teams feeling the financial pinch

The financial structure is impacting teams, with Riot Games significantly reducing guaranteed distributions to organizations. In 2023, teams received around €26 million, but this decreased to approximately €12 million in 2024, tied to better sporting results and marketing efforts.

Several team slots have changed hands over the years, with FC Schalke 04 selling its LEC spot to Team BDS in 2021 for around €26.5 million. The football club eventually pulled out of League of Legends altogether in 2024, ending its engagement in the Prime League.

Among the original ten LEC founding members, only G2 Esports, Fnatic, Team Vitality, and SK Gaming remain part of the league today.

Despite the significant losses, Riot continues to invest in the LEC, recognizing its value in attracting and retaining players, as well as driving brand awareness. With an estimated 100-140 million League of Legends players worldwide, the esports scene offers considerable potential for growth and exposure.