Riot Games snags $8 million, will launch League of Legends in China via Tencent

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Artwork from League of Legends. Credit: Riot Games.

Riot Games, a Culver City company started by two former roommates from the University of Southern California, this morning announced it has bagged $8 million in venture funding, bringing the studio’s total financing to nearly $20 million -- even before Riot has launched its first game.

The largest investor in the latest round of financing is Tencent, a Chinese Internet company. Based in Shenzhen, Tencent operates QQ, China’s largest instant messaging services, with 448 million active users. Tencent had previously agreed to publish Riot’s title, League of Legends, in the world’s most populous country.

Riot, founded in 2006 by USC grads Brandon Beck and Marc Merrill, will launch the game in North America and Europe in October, followed by a launch in Asia. As a fantasy role-playing game, League of Legends is born out of the World of Warcraft mold. Indeed, it was developed by the same team that made Defense of the Ancients, one of the most popular player-created ‘mods’ based in the Warcraft III universe.

But League of Legends, or LoL (go ahead, snicker), is expected to differ from WoW in two key respects. The first is that League of Legends focuses on short game sessions that last 20 to 30 minutes from start to finish. In contrast, World of Warcraft campaigns can last hours at a time, much of it waiting around for something exciting to happen. League of Legends promises to distill that experience into shorter bursts of combat and strategy, minus the thumb twiddling.

Secondly, League of Legends will be free to play, whereas World of Warcraft players must buy the game disc and pay a monthly subscription to play the game online. Riot’s business model, which is much more prevalent among game companies in Asia than in America, is to entice players to buy virtual goods, such as character outfits and power-ups.

‘There are people who will play for a couple of months and spend a couple of bucks,’ said Mitch Lasky, partner in Benchmark Capital, a venture fund that has invested in Riot Games along with Tencent and FirstMark Capital. ‘Then, there will be people who will play for a couple of years and spend a couple hundred bucks. This game provides an experience that can accommodate that.’

-- Alex Pham

Follow my random thoughts on games, gear and technology on Twitter @AlexPham.