Cloud9 Losing Millions in CSGO

by in CS:GO | Jan, 23rd 2020

We’ve known for a long time that CS teams aren’t the most profitable in esports, between the hesitancy of sponsors to jump on board and a lack of revenue generation for teams beyond Major stickers in-game. Now, however, we’ve gotten a glimpse into just how unprofitable a CSGO team can be, even for a big org, as Dbltap shed some light on the revenue going on with Cloud9.

Millions a Year Gone, But Siege Looks Good

In a recent interview with the team about the B Site franchise league the team is going to be participating in, Cloud9 was asked about the sustainability of owning a CSGO team, and how the finances of it worked for them in particular.

The President of Cloud9 Dan Fiden said their CSGO team is indeed bleeding money to the tune of $1-$2 million, an eye-watering sum for a team in a game as big as CS to lose. He also pointed out that this was rather common for top tier CS teams based on other orgs he’s spoken with and challenged any team in the top 20 to prove they aren’t losing similar mounts.

Most surprisingly of all, however, was his note that the team made more money from their Rainbow6 Siege team than they did CS and that the roster there was profitable despite being in one of the game’s weakest regions. While a big part of that is thanks to the in-game pilot program getting C9 skins for characters and weapon into the game, Fiden noted that the team was still profitable even without those, thanking Ubisoft for working so well and closely with teams to keep them sustainable.

Moving back to CSGO, though, Fiden noted the reason so many teams were still trying to or staying involved with the scene had to do with the recent push across esports for a move towards franchise models. This is something B Site and ESL have been working on pushing into the scene sometime this year. With the opportunity to capitalize on one of the world’s biggest esports more sustainably, many teams have been jumping in to try and get a spot in the new leagues, believing them to be the future of CS.

This is still only hoping, though. He foreshadowed money in the scene, moving on to other titles if this system doesn’t work out in the long run. He suggested that these franchise leagues could make or break for CSGO to continue growing as an esport.

Isaac’s Take: Not a Surprise

It’s not surprising teams are losing so much money on CSGO given the struggle the scene must find sponsors willing to take it on and the difficulty for TO’s in getting revenue generated. The Counter-Terrorist vs Terrorist motif has always been a taboo subject that most sponsors who would otherwise invest in the scene don’t want to touch. That’s only making it harder and harder for teams to generate income beyond merch sales.

Winnings generally go mostly to players and not teams, so there’s little money to be made there. While Valve’s hands-off approach has meant the only time we see marketable items for teams in-game is when they get stickers for making the Major. Those aren’t great monetization options. Fiden revealed that the team only got $70,000 from ESL last year (noting the revenue was not based upon performance).

Of course, many will point to just how many players C9 has signed in the last two years as an obvious answer to why the team is losing money. That doesn’t take into account anytime they’ve sold players though, which could easily offset the buying price.

Still, losing that much money and finding few sources of revenue is problematic. The fact that this franchise system is the make or break for big orgs staying in CS has got to have many in the scene sweating, especially the plethora of top tier players who may find themselves without a team if this doesn’t pan out.

That’s not to say it will, though, and likely, this will be incredibly successful. It’s going to take everyone from Valve to TOs, teams, and players to get these leagues off the ground and making money for everyone. The latter three are already on the same page. It’s just on Valve now to decide if they’ll play ball.

In-game items for teams are one of the best ways for teams to make money. It’s up to Valve as to whether they decide to implement anything from more stickers to character and gun model skins or not. Valve has a history of not playing nice in this regard, but hopefully, the desire to keep the game’s ecosystem successful will finally spur them to action.

As always, though, only time will tell. We’ll have to see what else is in store to make these league’s profitable for everyone.


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