Similar to traditional sports teams, gaming teams make money through several different channels. These mainly include prize pool winnings, merchandise sales, and partnerships and sponsors. Let’s break this down.

The primary revenue for organizations is the winnings that a team gets when they win a major tournament. This represents a significant portion of revenues. Last year’s The International 2018 for the game Dota 2 saw over $25M in prize money given to teams, for instance. The winning team, “OG,” took home $11M for coming in first place.

The second source of revenue is merchandise sales. This includes sales of branded t-shirts, jerseys, hats, accessories, stickers, etc.

Last but not least, there are partnerships and sponsors who provide financial compensation for their products to be used by the pro gamers and/or be on the players jerseys. This is increasingly becoming a huge part of being a pro team. Sponsors and partners range from gaming companies like Razer to even car manufacturer Honda. As another example, Universal Music Canada, a leading music company, has sponsored Luminosity Gaming in hopes of gaining recognition within the increasingly popular gaming industry.

There we are: three major revenue sources for gaming companies as a whole. Next week, we’ll tackle the differences between a traditional sports team and a gaming team.

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