Two college friends made one game. That game became the most played video game on Earth. League of Legends has been the #1 PC game globally for over a decade — 150+ million monthly players, $2 billion+ in annual revenue, and the biggest esports ecosystem in the world. Riot Games was acquired by Tencent for an estimated $400 million when it had one game and one revenue stream. Today it would be worth $25+ billion easily. Brandon Beck and Marc Merrill built the company that proved free-to-play gaming could generate more revenue than any $60 boxed game. The best $400 million Tencent ever spent.
Founded
2006
HQ
Los Angeles, USA
Total Raised
$100 million
Founder
Brandon Beck, Marc Merrill
Status
Owned by Tencent (acquired 2011-2015)
Website
www.riotgames.comTHE ORIGIN STORY
Brandon Beck and Marc Merrill were college roommates at USC who loved playing Defense of the Ancients (DotA), a mod for Warcraft III. They thought: what if someone built a standalone, polished version of this game with its own company supporting it?
In 2006, they founded Riot Games with seed money from investors. They spent three years developing League of Legends.
It launched in October 2009 as a free-to-play game — players pay nothing to play but buy cosmetic items (skins). The game was an instant hit, growing from 500,000 players to 12 million monthly active users within a year.
WHAT THEY ACTUALLY DO
Free-to-play with cosmetic microtransactions. Players never have to pay — the game is completely free.
Revenue comes from selling character skins, battle passes, and cosmetic items. This model generates $2 billion+ in annual revenue.
Riot also earns from esports broadcasting rights, merchandise, and media licensing. They've expanded to multiple games (Valorant, Teamfight Tactics, Legends of Runeterra, Wild Rift) using the same model.
THE PRODUCTS
League of Legends — the flagship MOBA with 150M+ monthly players. Valorant — tactical shooter competing with Counter-Strike (10M+ monthly players).
Teamfight Tactics — auto-battler game. Wild Rift — mobile version of League of Legends.
Arcane — animated series on Netflix (won multiple awards). League of Legends Esports — the biggest esports league globally.
HOW THEY GREW
One game, perfected. Instead of releasing new games every year like other studios, Riot spent a decade making League of Legends better.
Weekly patches. Constant new characters.
Rotating game modes. Massive esports investment.
They treated one game like a living product, not a disposable release. This created a community with incredible loyalty.
THE HARD PART
Tencent ownership raises geopolitical concerns. As a Chinese-owned company, Riot faces scrutiny about data privacy and content censorship.
Competition from Valve (Dota 2) and Epic Games (Fortnite) is real. Employee culture issues surfaced in 2018 when Riot faced lawsuits over gender discrimination and toxic workplace culture.
The company paid $100 million to settle.
MONEY TRAIL
Series A
2008 · Led by Benchmark Capital
$8M raised
Acquisition (majority)
2011 · Led by Tencent
$400M raised
$400M valuation
WHO BACKED THEM
Tencent purchased a 93% stake between 2011 and 2015, eventually reaching 100% ownership. Earlier investors included Benchmark Capital and FirstMark Capital.
The Tencent acquisition valued Riot at approximately $400 million — a fraction of what it would be worth today.
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