TL;DR: It’s been a few months since we announced the beginning of our process to choose the new NA LCS member organizations. While we’re not quite at the finish line, we wanted to give you an update on how the process has gone so far, what’s next and when you can expect to hear more.

Back in June, we introduced a couple of key changes to the NA LCS – the biggest of which was the announcement that we’d be moving to a member organization structure for 2018. As we talked about at the time, this is an important step forward for the league for a couple of reasons:

• It eliminates the uncertainty of relegation, which means that organizations and sponsors can take longer-term bets and unlock deeper investment
• It creates opportunities for teams and pros to share in the upside of the league long-term by creating and sharing in league-based revenue
• It creates a league in which pros feel the benefits of a stable NA LCS with a larger voice and better protections

Here’s some more details about what’s been happening behind the curtain since we announced the process.

One quick note before we get down to it – because we’re still in the middle of a closed process, and we want to respect teams currently in and out of the process – there’s a few things we won’t be able to disclose. First of all, we won’t be able to name names as to which groups are still in the process or who’s going to join the league. This isn’t *that* announcement (read on for more details about when that one will land). Equally, we won’t be confirming the number of applications we received or teams who aren’t joining us for the later stages.

PHASE ONE – COMPLETE

During Phase One, we received applications from interested groups. As we talked about in our article The Evolution of the NA LCS, in these applications we asked for a deep dive on several key things that would make a team successful in the NA LCS, including:

• Team Strategy – How will they be supporting the pros that work with them? What’s their plan to be competitive? How do they want to grow and support upcoming pros/NA talent? What opportunities will they provide to pros post-playing career? What support staff are they bringing on to support pros?
• Brand Plan – How do they plan to interact and acquire new fans? What’s their plan for creating content? Why should fans care about them over a different team? What makes them unique?
• Business Plan – How will the org be funded? How will they compensate pros and attract sponsors?
• Owners – Who will be working directly with pros, and what is their experience with esports?

After reading through all applications carefully, we began the work of narrowing them down. To do this, we partnered with an external consultant, Daniel Barrett and his team at Barrett Sports Group. Dan and his team have an extensive background in valuation and strategic planning across multiple traditional sports and they were instrumental in helping us evaluate the Phase 1 applications and prepare for Phase 2 based on their experience of what makes a successful long-term team and league partnership. Their clients include MLB teams (including the Giants and Blue Jays), NFL teams (including the Raiders, Seahawks, and Broncos), NHL teams (including the Hurricanes and Islanders), NBA teams (including the Grizzlies and Pelicans), and MLS teams (including the Timbers, Sounders, and Crew). They have also provided consulting services to several leagues, including Major League Soccer and the National Hockey League.  

At this stage we were looking for groups to demonstrate they had thought in depth about all of the above questions and had smart, actionable plans in place. It’s important not only that the teams complement each other as part of an overall league, but also that they challenge the league and help us grow, so we were reviewing applications with that in mind.

For those that were moved forward into Phase Two, we provided questions and areas we’d like to dig into as part of the next step. For groups that weren’t selected, we reached out to give feedback.

PHASE TWO – COMPLETE

For teams that moved into Phase Two, the next step was an in-person meeting at the Riot campus for interviews and discussion with senior Riot esports leadership. These meetings provided teams who have moved on to the next stage with an opportunity to present their plans in person, answer our questions (identified during Phase 1 review), and ask questions of us in turn. In addition, for the groups that do not already have a League of Legends team, we wanted to go in depth around how they would plan to set up – including staffing the team, providing living and working facilities for players, establishing team branding, creating content and interacting with the fan community. The deadline for these submissions was September 13.

WHAT HAPPENS NEXT?

Final decisions

We are currently in the process of reviewing all the information we have gathered on every applicant that is still in the process. This includes:

• Their Phase 1 applications (which ranged from around 15 pages at the shortest to approximately 250 pages at the longest)
• Our notes from the various phone calls and meetings we have had with applicants, including their Phase 2 interviews
• Any additional written submissions from teams brand new to the NA LCS (which ranged in length from 4 pages to approximately 30 pages).

While we are still working out what the NA LCS will look like in 2018, we do know that it will be made up of 10 teams. While we considered contracting to 8 teams or expanding to 12, neither felt like the right decision. We believe the esports ecosystem in North America has ample pro talent to support 10 teams and that contracting further would unnecessarily limit opportunities for talented pros. However, to expand further we will first need to concentrate on building a more extensive pipeline of local talent and established organizations. When we talked with the Players’ Association for pro feedback, they were also strongly in favor of keeping 10 slots for competing teams.

Even though 10 is the right number of teams for the league, there were more than 10 applications who could potentially be great partners for the NA LCS. When reviewing the applications and speaking to the teams, we looked for experience and expertise across multiple areas, including content creation, sponsor acquisition and retention, storytelling, merch, fan engagement and more. No team had a perfect application, but the strongest index high on several of these categories. As we continue to fill out the league, we are looking to pair those organizations with groups that provide strengths in other areas. It’s our hope to create a diverse league, made up of teams who have not only a longterm commitment to League of Legends esports but also the skills, expertise and experience to help us evolve the NA LCS so that it will thrive long term.

Once we’ve made our final selections based on the criteria above, we’ll be reaching out to teams that are and aren’t selected. For those selected, we’ll work with them on final legal documents and work with them to prepare for the 2018 season.

We’ll be announcing the final NA LCS team lineup in November.

What about the ‘buy-in’ fee?

Selected teams that were part of the NA LCS or NA Challenger Series in the 2017 Summer Split will make the first $5m payment of the $10m entrance fee into the League. Groups that do not include a team that was part of the NA LCS or NA Challenger Series in the 2017 Summer Split will make this $5m payment, and will pay an additional $3m transition fee.  

The $3m transition fees will be pooled and paid out to teams that were part of the NA LCS or NA Challenger Series in the 2017 Summer Split that either did not apply or were not selected for the LCS in 2018 according to a formula that takes length of involvement and league into consideration. Teams will be provided 3 shares of the overall pool for each split they were involved in the LCS and 1 share for each split they were involved in the Challenger Series, with a cap of 10 shares for any team. We begin counting splits at the last major change in ownership of a team.

This transition fee is our way of acknowledging and thanking those teams for the part they played in building the NA LCS to where it is today and to help that team transition out of League of Legends.

What happens to pros whose teams aren’t selected?

Teams that did not apply or are not selected to be part of the LCS in 2018 will have a few options for dealing with their player contracts. They will have the opportunity to sell those contracts to teams that are entering the league or remaining in the league (or to international teams), or they can release their players into free agency. New and remaining teams will be able to buy these contracts or sign new players starting at the opening of the free agency signing window on November 21, 2017.

All teams no longer a part of the league will be required to sell all of their player contracts and/or release all of their players in order to be eligible for the exit fee described above. Through this mechanism we are confident that all current professional and semi-professional players will have the opportunity to win a spot on an LCS or Academy League team for 2018.

What about the Players’ Association?

First of all, an apology. As part of our first announcement we promised an update on the Players’ Association in August, so this is pretty late. We’re sorry it’s taken us a while to provide an update on the PA and what’s been going on behind the scenes.

One of the biggest steps towards the NA LCS of the future is creating a structure where pros have a real and actionable voice. This started when players voted on their representation for the new Players Association, and continues today as the group works hard behind the scenes to get fully set up.

As voted by pros after presentations by several groups at the Players Summit in July, the NA LCS Players Association is headed up by Hal Biagas as Executive Director. Hal has previously been counsel to the NBA Players Association and will be representing the PA and pros in discussion with external groups, including Riot and the NA LCS teams.

Since the vote, the PA has had two meetings in LA to bring pros together, discuss their needs and outline next steps for the Association. In those meetings they discussed amateur development, league structure in 2018 and long-term changes pros would like to see as they look to the future of the league.

The PA will be setting up its own communication channels to keep everyone up to date in time for the launch of the new season, but here are some major next steps from for the group:

Drafting a Players Association constitution – When the Players Association was first formed the overall goals were to give pros wider protections, access to greater resources and a seat at the table during key negotiations. The group’s first important move will be to agree on a constitution – a basic set of guiding principles as to what they intend to accomplish and what their values are as a group.

Electing player leaders to represent the association – To fully represent the voice of the pros, the PA needs to identify engaged and passionate voices. Several pros have already expressed an interest in a more formal role and electing representatives will be an important next step following the formation of the new teams.

Providing Input on the 2018 League Structure/Operations – As we finalize details for the 2018 NA LCS season, pro feedback and input makes up a vital part of our planning

We look forward to returning later this year with the full details of what we believe will be the strongest NA LCS lineup yet!

Bear Schmiedicker, yes, Bear is his real name, is one of the NA LCS Leads. He previously led and grew the NA Player Support team at Riot and has had a long history and passion for Esports. When he isn’t on the Rift or the NA LCS studio, he’s chasing around two corgis (Appa and Korra). On Twitter, he’s just @bearfromspace.

Chris “Grza” Greeley is one of our League Operations Leads. He leads a team focused on supporting the operations of NA LCS and international events. He is not the former congressional representative from Maine, but he is an ex(ish)-lawyer from New York City. He channeled years of raiding on his Resto Druid into life in the bottom lane dropping wards and shooting gliterlances. You can find him on Twitter as @IAmGrza.