Over the past fifteen years, one organization has left a deeper mark on the history of esports than any other: T1. With superstar Lee “
” Sang-hyeok at its helm, the South Korean team has claimed six
League of Legends World Championship titles, the cornerstone of the esports ecosystem. At the height of the title haul that would go on to define its legacy, the organization underwent a major turning point in 2019. The team, then operating under the name SKT T1, entered into a partnership with American company Comcast Spectacor and took on its new name. Since then,
T1’s trophy cabinet and popularity have only continued to grow.
Last August,
the team hosted its second Homeground, welcoming fans to Seoul’s KSPO DOME for two days of LCK action. On the sidelines of the event,
Sheep Esports had the opportunity to sit down with T1’s executives to discuss the organization’s finances and understand how a team that spent two decades deliberately losing money became one of the handful of esports companies anywhere in the world to turn a profit.
Joe Marsh, T1’s CEO, and Tucker Roberts, who sits on its board on behalf of Comcast Spectacor, described a business, which grew from roughly $1 million in revenue in 2019 to $64 million last year. That growth was anything but linear, and the two executives were also candid about the years in between, which Roberts describes without much embellishment. “I called it a death spiral for a few years,” he says.
“It was a game team”
Let’s go back to where it all began. SK Telecom T1 had existed since 2004, but not as a business. “Up until that point [2019], SKT T1 was inside the marketing sports engine of a conglomerate, inside SKT,” Marsh says. “And that was the business. It was a game team.” Roberts is blunter about what that meant: the team “was not a for-profit enterprise, like a venture. It was a marketing division for SK Telecom, and so it lost a lot of money.”
Marsh says the distinction still shapes Korean esports. “Any team that's owned by a conglomerate has a different business mission than someone that is owned by third parties that are trying to be a profitable business,” he says. “Are you a sports marketing tool for a larger parent company that's trying to target younger audiences, or are you a company that has multiple third-party investors that you're trying to return shareholder value to? There's a big difference in how you spend and how you operate.”
The 2019 joint venture with Comcast Spectacor rewrote the brief. “We were expected to be a standalone company that turns a profit for its shareholders,” Marsh says. “We're not a young company, but we are young in the sense that it's only been the past few years that we've been expected to be a for-profit-generating entity.” The physical change tracked the corporate one: from an office park in Ilsan, 45 minutes north of Seoul, to the 10-story Gangnam facility T1 built in 2020.
Sponsorships first, because they were fast
The first move was the obvious one. Like most teams in the industry, T1 first set out to find partners, and Roberts is refreshingly straightforward about why. “Sponsorships are high margin, so they don't have much cost of goods associated with them, and that means that, for all of our losses, every dollar of sponsorship we can add is very impactful,” he says. “Also, they're fast to onboard; you just have to find a partner and sign the paper, and you're good.”
He is equally clear it was never meant to be the foundation. “There's a limit to how much space you have on your jersey, to how much inventory you have to sell,” he says. “And I believe sponsorships are a shaky foundation. And this, I think, is something the whole esports industry needs to be aware of: if there's a recession or a big economic downturn, sponsorships are going to be one of the first places that these companies look to cut.”
Marsh makes the same point as a warning about how esports organizations get valued. “I always get those emails from third parties that are like, ‘I have this team selling their business. They have five million dollars in revenue, but 80% of it is in sponsorships.’ Well, that's risky.” The CEO adds, “The hardest thing to do is renew partnerships every single year.”
The most unexpected part of Roberts’s account is what T1’s largest business unit is today. “The second business unit we've added, which is now our largest business unit, was merchandise,” he says. Since it launched, “that business is now significantly bigger than our sponsorship business.”
The idea was not Korean. “I was really inspired back in 2019 by 100 Thieves and the incredible work they were doing, with the ‘hoodie org’ memes,” Roberts says. “That was kind of streetwear for an American brand, and we were looking to do something for a Korean brand.” He also credits Dplus and Gen.G for their work in the same space.
What he values is where the risk sits. “It's up to our fans: when they buy something, they're supporting the team,” he says. “If there's an economic downturn and one of our great sponsors decides to leave, our fans can still support us.”
The death spiral, and the raise that wasn't
Several years passed between the sponsorship push and profitability. “As our business was growing, we sometimes did not have enough money to invest in building out certain businesses,” Roberts describes. The example is a Basecamp, the organization’s gaming and training facility: “If we need, say, a million or two million dollars to build a Basecamp, and we think that that Basecamp will drive profit, but we don't have the money to invest, then we can't do that.”
“And so that's where we were kind of caught in this. I called it a death spiral for a few years, where it was like, we’re losing money, but losing less than we had the previous year and less than the year before that, but we didn't have any money to invest in new things,” Roberts says.
That squeeze is also the context for a correction Marsh offered unprompted. In 2024,
T1 was reported to be raising $35 million to expand its live events and Basecamp businesses. “
We did not raise $35 million,” Marsh admits. “
We talked about it. I think I raised a third of that.” The money stopped being necessary: “
Once we reached profitability, we took a fraction of that raise on.”
Profitability arrived last year and, both men say, has continued. “I don't think we had a one-year profit,” Roberts says. “I think we're largely profitable now, and we're scaling.” Marsh confirms 2026 is tracking the same and frames it as rare: “Globally, there's probably a handful of teams that are really making that profit.”
Asked what the profit is for, both answered in terms of players rather than shareholders. “It allows us to pay our players, and so we have stability here,” Roberts says. “We have the resources now to continue to pay them better than any other org, and that means that they're going to stay with us.”
Homeground: seven figures a weekend
The live events business is where the numbers get specific. And while one might reasonably question whether these events are profitable once production costs are factored in, Marsh did not hedge. “How profitable? Very profitable,” he says. “You're looking at a seven-figure profit for these events.” The costs are real. “You're looking at a couple of million dollars in those expenses,” he says, with genuine exposure if the tickets and partnerships do not land. The two big line items are broadcast and staging.
The scale is the point. T1’s LCK home matches are normally played in a 400-seat venue. “You go from a 400-seat venue to a 12,000-seat venue, and you're controlling the show,” Marsh says. The first edition drew 7,500 spectators; recent ones have drawn between 12,000 and 15,000.
Roberts traces Homeground’s growth back to a fan event that kept expanding. “We thought, ‘Well, what if we got an LCK game, and Riot Korea let us do an LCK match?’ And thankfully, they were able to say yes. And it was a huge success. And so then we said, ‘Could we do another, but do it even bigger?’ And they said yes. And this year we said, ‘Could we do two?’ And they said yes. So we're hoping to keep saying yes, because we'd like to do three, four, five, six, as many as we can do per year.”
Marsh's number is ten a year, and he frames the ceiling as Riot's rather than T1's. Abroad, the timeline is longer. “I don't think you would see one outside of Korea until 2028 or 2029,” he says, with Taiwan, Vietnam, the Philippines, and Japan as targets. And it would have to be big: “I don't think 12,000 would be enough. I think you want to do 20,000 or 40,000. If we're going to just do a 12,000-seat venue, just stay home and do it.” The West is out: “I don't think you would see us go to America or anything like that.”
Basecamp, and why it does not travel
The other unit funded by the raise is the out-of-home business.
Busan opened late last year, a Gangnam flagship will open in October, and Marsh says more locations are lined up, with the ambition of “really taking over the PC cafés inside of Korea.”
Each site has been an iteration rather than a rollout. “We started out in Hongdae, we moved to Busan, and the flagship will be in Gangnam now. Those all have different looks and feels, and you're learning as each location opens up what your fans and your customers want.”
T1 Base Camp in Busan. Credit: T1
Roberts explains why it works in Korea and mostly nowhere else. “It's such a dense population, and it's such a clean and safe country that people like to go out and play their video games outside,” he says. “It's a very social culture. People are running around, you get food, and you hang out with your friends. It's an after-school activity.” T1's contribution was space and cleanliness: “A lot of them, sometimes they're in small little shops, and they don't have a lot of space. We wanted to see what we could do with more space, if we can make it more of a community.”
Asked whether it exports, his answer is no. “My answer is kind of no. Maybe on a university campus. But I would say largely no. Maybe in Taiwan and in China and certain countries.” His test is simple: “If a country is already organically choosing to go out and play their video games in a PC café, then yes. But if you're trying to convince somebody to drive over in LA or something to go play video games outside, that's just not really how Americans like to play their games.”
He has tried. “We've done some work with Nerd Street and others. It's really tough to convince Americans to leave their homes.”
What T1 will not do
For a company that built several units in six years, both men are notably resistant to building another. “I don't think we're still in an era where we have to bolt on more businesses,” Marsh says. “We've dabbled in everything from webtoons to music projects to all the businesses that we have now. It's more about iterating on the things that we have.”
That includes game teams, and the reasoning is brand rather than budget. “There's a diminishing return if you keep adding more game teams,” Marsh says. “When you're wearing the T1 logo, the expectation, because the bar is set so high by the League team, is that you're going to win championships. So we don't want to just add games to add games, because that diminishes the brand.” T1 has exited Dota and Hearthstone on that basis.
Roberts is firmer and says explicitly that money is no longer the constraint. “We're very selective with what games we enter, because we want to be dominant. If we're not going to be number one in the game, then the way we view it is, and maybe this is wrong, but currently the way we view it is, it's going to be a drag on our brand. We'd rather not be in the game if we can't be number one.” He adds, “It’s not a resource issue, not at this point. Maybe earlier when we were losing money, but at this point, no.”
Counter-Strike is the clearest case, and they give different reasons for the same answer. Roberts sees a closed door: “
That game is, the fan bases are pretty entrenched, so maybe we've missed out on that.” Marsh's objection is that the economics run through a category T1 refuses: sustainability at the top of
Counter-Strike, he says, is “
predicated on having gambling sponsorships, something that we don't believe in. It's one of the reasons we're not really in Counter-Strike.”
“League of Legends and then gaming”
Asked whether the multi-title expansion is about reducing dependency on League, both said no. Marsh reached for food. “If you're a restaurant and you're great at making pizza, you wouldn't turn around tomorrow and just make hamburgers. People come to see you; they want to eat your pizza. And with us and League of Legends, we're synonymous with each other at this point.”
Roberts reached for data. “If you were to look at any data on PC bangs, you would see that League of Legends is occupying like 40%, some days up to 50%, of all game time. So I always say it's almost like League of Legends and then gaming, because it's that big of a category in Korea.”
Both leave the door open, and Roberts names the precedent himself. “It's worth always acknowledging that SK Telecom T1 was known for StarCraft before League. And so there's a potential that someday there could be a different number one game, and we're always trying to keep our eyes out for that.”
The model Marsh wants to pilot
The most forward-looking thing in either conversation would require Riot to change how the sport works. Asked whether Homegrounds will become standard in five or ten years, Marsh says they have to, and then goes further.
“Unless the model completely shifts in League of Legends and we go away from the franchising model and go more towards a golf model, where T1 hosts a Homeground event and I invite the best teams from all around the world to come to my event, and then G2 hosts an event or Karmine Corp hosts an event and we go to their event,” he says. “I would love to experiment with something that looks like that, because the franchising model was great a few years ago. What does it look like 10 years from now?”
He has a version he could run tomorrow. “I would want to try to pilot that first, in an off-season event, where we invite a couple of teams from each region. It's a ticketed event where I can have the opportunity to bring that revenue in, rent the facility out, and do it right, and just show what's possible.” For now, he concedes, the landlord is content. “Riot likes the setup they have, and it's worked really well, obviously.”
