I want to start off this Dota Pro Circuit suggestion post by describing what I do and where I’m coming from. I’m the General Manager of J.Storm, an organization that competes in North America. Most of this post will be based off of my experience over the past two seasons managing the organization in the DPC, the Dota scene and practices that we’ve used and seen used.
Right now, as explained by a number of players, casters, and analysts, running teams that exist outside the top four-to-six teams in the world is wholly unsustainable, especially in North America. There’s a few reasons for this:
- Reliance on The International
- Prize pools are too top-heavy
- Lack of opportunities for teams that fail to qualify for a major or minor
- Lack of growth in the game
Let’s start with The International. The “Super Bowl of Esports” is what everyone looks to outside of Dota and the huge prize pools make it the most exciting event in esports. In my opinion, it has helped put esports on the map. The amount of money you can win at the event proves to skeptics that you can make a career out of esports. I think it has been a valuable marketing tool Valve has used to grow the game and has given a reason for pros to choose Dota for their careers. It’s been necessary to our existence in Dota. It’s at the point, however, where it will erode the scene if it continues along the same path.
Let’s review last year’s DPC total of around $39 million ($25.5 million prize pool at TI8 + $13.5 million at majors & minors). $11–12 million of that goes to the winner of TI. That’s 29% of the entire prize distribution of the season right there, going to one team. In fact, nearly 80% of the entire TI8 prize pool of $25.5 million went to the top four teams. Say the standard prize cut for organizations is 10%. That means if your org won TI8, the org makes $1.1-$1.2 million.
Running an org
In an ecosystem where the majority of organizations primarily survive off of prize money and sponsorships, that’s an extraordinary amount of money gobbled up by the top teams. Unless you’re a team that’s consistently winning — and even if you are winning — you likely aren’t making much in broadcasting rights, ticketed events and merchandise sales, three big drivers in leagues like the NFL. A lot of comparisons between traditional sports and esports are inevitable, but that’s the main difference between why traditional sports teams can be sustainable and why many esports orgs aren’t. Esports teams almost need to act as a supplement to a greater business and be a marketing engine or be willing to burn thousands of dollars a year (this is a large understatement for how much money is actually burned per year).
I’ll let you do the math, but take into consideration the expenses incurred by running an organization in NA:
- Salary for five team members + a coach
- Salary for a team manager
- Salary for staff — sales, social media, content/video, HR/admin, other support, etc.
- Team house & maintenance — the recent trend is placing team houses on the East Coast, because NA pubs are, well, NA pubs. Players want the ability to play on zero ping to NAE servers and be able to play EUW for pubs or scrims.
- Bootcamps — in addition to the team house, top teams look to travel to the region where the tournaments are to adjust to the time zone and prep against top competition. This can be quite expensive.
- Food — this is surprisingly expensive when your team is traveling constantly as it’s tough to find a chef willing to work periodically for a cost-effective wage. Teams need to eat decently so it adds up quickly when ordering or buying food.
- Top playing equipment
- Marketing expenses
- Team bonding events
- Airfare and other travel expenses
- Legal fees, visas
- Health & wellness — gym, trainers, workouts, etc
- Cable/internet/other subscriptions
These expenses, accompanied by the usual business expenses, add up to tens of thousands, if not hundreds of thousands of dollars a month.
With TI at over $30 million this year, it is actually likely that even if your team wins it all, you still won’t break-even based purely on prize money. Obviously winning TI brings a host of sponsors knocking, content/media opportunities, etc., but in this environment we’re currently in, it’s essentially another year of runway for newer organizations. You’re then tasked with paying players more, providing even more quality to retain who you have, and growing other avenues in the business. Then if your team struggles or doesn’t perform up to your expectations, you have a team that’ll likely be unhappy and overpaid, without the ability to earn any additional prize money or supplemental income.
With around 85%-95% of prize money going to players from most orgs, and 44% of the prize money at TI going to the first place team (if prize allocation stays the same from TI8), each player and coach would earn around $2 million for winning TI9 at the current prize pool amount. It is absolutely life changing for the team that wins TI. It is so life changing that every team and every player will do everything they can to get to that point. With so much money on the line, that means that no player is safe from being kicked. Teams will do whatever they can to try to find a miracle winning formula, rather than persevering or growing as a team.
We’ve seen multiple instances — our team included — of dropping hard-earned DPC points to make changes that teams hope will work. Players would rather risk finding a better formula to do well at TI, even if it means dropping points and not going altogether. With so much money on the line, you can’t blame them.
Take J.Storm this year. We made it to the first three majors, placed 9–12th twice, and placed top 8 at the DreamLeague Major. These majors are bloodbaths against the best teams in the world. We collectively made a total of $70,000 from a total $6.5 million in the DPC, or just over 1% of the prize money during the circuit. Split that seven ways for ease of conversation, the players, coach, and org made $10,000 each. There are a lot of teams out there that weren’t even that fortunate. $10,000 for each player from a total of ~$37 million and that’s for a team that made and didn’t finish last at three majors.
Until the prize money for players that aren’t in the top 4–6 teams in the world is livable, we can’t expect teams to stick together.
I want to talk about the largest driver of money for orgs in the entire ecosystem — sponsors — and what allows us to pay our players.
After hundreds of conversations with potential sponsors, the top brands willing to spend money want some mix of the following:
- Teams that win
- Quality content
- Growth of the game
If we go down the list, we can start with sponsors wanting to be associated with teams that win. To win, you need the best players. To get the best players, you need to pay them like they’re the best players. To pay them, you need sponsorship money. See where I’m going with this one?
Eyeballs. This one is particularly tricky for teams, especially in North America at the moment. Sponsors not only want a large amount of viewers watching teams with their branding, content, etc., but they want them in the correct region. There hasn’t been a single DPC event in North America this year. Why would sponsors want to sponsor a team where the times don’t make sense for their region and viewers won’t even be able to watch the team play? Sponsors realize that they may as well wait for TI and either support the team then or see how the team does going in to the next year. They also know what teams will be there, when they will play, who will be watching, etc.
On to content next. I’m not going to spend a ton of time on this, but this is where other games, for the most part, kick our ass. With the continued rise of the influencer, I think this is an area where orgs, players and Valve can do a better job on getting content from players outside of the game. Fans rightly want to know what’s going on with their favorite players and teams.
Growth of the game. Many potential sponsors we’ve spoken to have talked about the stagnation of Dota, where before the autochess spike had been plateauing or declining for months. Before sponsors jump in to a game and commit to one or two year deals, they want to know the publishers are invested in the game and that the game is growing. I think Dota’s at a point where there’s a loyal fan base that’s not going to go away, but it certainly isn’t gaining traction among the multitude of other games coming out. This also doesn’t start on the point of lack of new pro talent coming through regions like NA either. Again, we need to find a reason why kids want to stick with Dota over new games.
One of the other points we hear a lot is the lack of stability in Dota. This has already been touched upon in the race to win TI, but sponsors want to know what they’re paying for and who’s going to be on the team.
With TI9 now over $30m, let’s say there’s $35–36 million to work with over the course of the season in terms of prize money. Here are the goals I set for the DPC:
- Make the scene sustainable for teams and players outside of the top 4–6 teams
- Stabilize the scene in terms of roster stability
How do we get there?
- Establish a clear schedule where teams play a certain min. amount of games
- Make the middle (Tier 2–3) organizations an average of $350,000, or 1% of the total prize money, for the year
- Promote regionality, storylines and rivalries
- Foster growth for tournament organizers
Regional Leagues — $19.35 million
Have six leagues for six regions simultaneously going worth $3,255,000 each.
Regions: NA, SA, EU, CIS, SEA, CN
Top league — top 8 teams per region, relegation system for the bottom 1–2 teams
- 2 or 3 “seasons” over the course of the year
2 seasons per year:
- Pro league — top 8 teams per region — $1.5m per season
- 30% — $450,000
- 20% — $300,000
- 15% — $225,000
- 12% — $180,000
- 8.5% — $127,500
- 6.5% — $97,500
- 5% — $75,000
- 3% — $45,000
- Semi-pro league — next best 8 teams — $112,500 per season
- 30% — $33,750
- 20% — $22,500
- 15% — $16,875
- 12% — $13,500
- 8.5% — $9,562.50
- 6.5% — $7,312.50
- 5% — $5,625
- 3% — $3,375
- Below that, leagues of amateur teams directly in-client
OR 3 Seasons per year with the same prize percentages, split 3 ways instead of 2
*Disclaimer: I am NOT an economist. This seems more reasonable to me than the current system based on my own financial knowledge of how much it costs to run a team and what players currently make.
Majors and Minors — Stays at 5 majors, 5 minors, with DPC points implications — $6.5m
For the sake of this blog being too long, I’m going to gloss over this section. I’d like to see placements in these regional leagues lead to spots in majors and minors and get rid of qualifiers altogether. Perhaps the top teams from each regional league earn a direct invite to TI, or the top 2–3 teams make it to the major. Majors and minors can still have the same merit where the top teams qualify for TI, although the points from winning one DPC event are far too high in my opinion. I’m going to leave the weight of the DPC points earned for a later conversation.
The International — cap it at $10 million
I’m sure people will disagree with the premise of getting rid of what some people see professional Dota as: insane prize money. If you’ve read this piece, then you’ll understand why I think it should be capped. If we want this game to grow, we need people to be able to make a living playing it. I don’t want a system that’s franchised, that’s over-controlled, or one where everyone wins. In fact, I don’t care if organizations are profitable. From my side, I just want it to be somewhat sustainable for orgs, for players to be able to play, and for sponsors to want to support the scene all year, not for two weeks during TI.
Pros and cons of this format:
- Players outside of the top teams have a way to make money throughout the year.
- In unstable regions without eight top teams, it encourages teams to get together, play together and earn a living trying to do so.
- It promotes story lines and regional rivalries. When teams consistently meet with a lot on the line, it’ll be better for team and player recognition.
- It guarantees your team is playing a set amount of games, at set times, on set dates. This is very important for sponsors so they know when you’re competing and who will be watching.
- This format allows Valve to remain hands-off. A regional league lets Valve choose tournament organizers to run a league in each specific region.
- Tournament organizers win with this format if Valve outsources it. They’ll be able to get regional sponsors and build a local fan base.
- The very top teams won’t make as much in prize money.
- TI may lose some of its luster if it’s not the gargantuan prize pool we’re used to.
- How will this look like for next season’s Battle Pass and how does the money get distributed if we don’t know how much is around?
- In strong regions like EU and CN where there are many top teams, there’ll be a sense of injustice as lower tier teams in regions with less talent will make as much in prize money from their respective leagues.
- Scheduling issues. If majors and minors are already set for next year in certain locations, it’ll be tough to run a league with that many minors and majors, even if we do away with qualifiers.
Current problems in the DPC:
- Reliance on The International
- Prize pools too top-heavy
- Lack of opportunities for teams that fail to qualify for the Major or Minor
- Lack of growth of Dota
How to fix:
- Cap TI at $10m
- Redistribute $18–20m to regional leagues
I hope that some of this article is helpful to those who are wondering what it’s like to run a team, the problems that orgs and players are facing, and what I think we can do to help progress the scene. It’s a game I love and have played half of my life. I think we all want to see it grow, and if anyone has suggestions, comments, etc., please feel free to leave a comment or hit me up on twitter @chandlerdent.
Thanks for reading!